The joint venture has exchanged contracts to purchase a 5.5-acre site in Stratford, E15, from London & Continental Railways for £44m.
The site has outline planning consent and detailed plans will now be submitted for a development of more than 400 new homes. The site is right next to Westfield Stratford City and the former Olympic Athlete's Village.
The anticipated revenue from the new Stratford site is in excess of £180m, with £90m for each partner.
Telford Homes chief executive Jon Di-Stefano said: "The joint venture with Notting Hill Housing Group provides Telford Homes with another fantastic opportunity in Stratford, a location where we have experienced tremendous sales success in recent months."