Berkeley Homes has signed a joint venture with the London Borough of Southwark to develop a 400-home housing development next to Tower Bridge on the south bank of the Thames.
The scheme has attracted controversy. Its design, known as the 'daleks' and featuring eight cylindrical towers, was originally opposed by the council.
Southwark, which owns half the 1.6-hectare plot – Berkeley owns the other half – had wanted to develop a cultural space on the site.
But this week it agreed to to sell its share of the land to One Tower Bridge Partnership, a 50/50 joint venture between the local authority and Berkeley.
The development will now feature 356 homes for private sales, 46 affordable homes on an adjacent site, plus a cultural space to be used for performance or as a gallery. A planning application has been submitted to Southwark Council.
"This will bring forward this site which has remained vacant and derelict for many years for development providing new homes, commercial and retail opportunities and cultural accommodation," said councillor Fiona Colley, cabinet member for regeneration.
"In addition, significant capital will be generated to assist the council in meeting its core objectives through the capital programme for the benefit of all residents in Southwark. This will form an important funding stream in this uncertain economic climate."