WEPL Investments, which has 93 hectares next door, will build the WesTrac headquarters and training facility.

WEPL Investments executive David Aspinall said construction on the WesTrac site would begin this week.

A corporation spokesman said work was set to begin on a $130 million WesTrac development at Tomago.

WesTrac, a distributor for Caterpillar machinery, will develop the site as a head office, distribution, workshop and training and apprentice centre.

The WesTrac facility is expected account for about 23 hectares of the company's Tomago land holdings, with the balance likely to be used for an industrial subdivision.

"We will provide a master plan for the development of that land," Mr Aspinall said.

"It's not a short term job. Any planning approval will have to go through the Department of Planning. It is a site of state significance."

Development corporation chairman Paul Broad said the purchase of the site was a "real vote of confidence in the Hunter as a base for diverse industrial enterprises".

"This important land at Tomago will play a significant part in contributing to the employment growth required to meet the demand for jobs identified in the Lower Hunter Regional Strategy."

Mr Aspinall said it was too early to determine exactly what would happen on the land, but he could rule out residential development.

"It's an industrial site, it's in a fantastic location, 15 minutes from the airport, 20 minutes from the city," he said.

"We have a fantastic opportunity to develop something that's of benefit to everybody in the region."