Lend Lease has signed a deal with Southwark Council to build more than 300 homes on part of the site of the Elephant & Castle Leisure Centre.
The existing Elephant & Castle Leisure Centre site will be divided in two; Squire and Partners will design a new residential tower for Lend Lease on the front half of the site while Southwark Council has appointed S&P architects to design a new leisure centre (with swimming pool) for the rear half.
Lend Lease's new development next to the Metropolitan Tabernacle will include more than 300 homes. Strata SE1 has 408 flats which gives an idea of the comparative scale of the scheme. In the summer a council report talked about a tower of at least 30 storeys.
With the Elephant & Castle Leisure Centre still open to the public, Lend Lease's description of the site it has acquired as "partly derelict" is questionable.
"We're really excited about bringing high quality new homes to one of the best connected parts of London," says Dan Labbad, Lend Lease chief executive officer for EMEA.
"Zone one developments of this scale are very rare and this is a unique opportunity for Lend Lease."
The deal between the council and Lend Lease for this site is separate to the much larger development agreement for the Heygate Estate site.
Dan Labbad added: "The new development will act as an early catalyst for our wider regeneration of Elephant & Castle and will help us deliver our long term vision for this part of London. Elephant & Castle has a fantastic future and we're excited to be playing a part in its transformation."
Southwark Council says that the existing leisure centre is likely to close in summer 2012 with the new centre up and running in spring 2014.
The residential tower is expected to be completed in 2016.
"The regeneration of Elephant and Castle is coming on in leaps and bounds, and this new agreement will be a further step towards the vision for this central London location," says Cllr Fiona Colley, Southwark's cabinet member for regeneration.
"This site is right at the heart of the Elephant. The sale of this site will enable us to provide a long-awaited new leisure centre and swimming pool, gym and sports hall."