Architect Ian Simpson and council leader Peter John were among the guests at a ground-breaking ceremony to mark the start of construction of the landmark One Blackfriars tower.
The 50-storey tower will include 274 private homes and a 'viewing lounge' for use by the local community on the 32nd floor. The scheme also features a boutique hotel in an adjacent low-rise block.
Last month the developer held a sales exhibition in Hong Kong to promote the flats. A studio costs from £899,950 whilst the cheapest three-bedroom home in the tower is more than £2.9 million.
The scheme – which is now being developed by St George, part of the Berkeley Group – was originally conceived in 2005 by the Beetham Organiszation as a hotel-led tower.
The skyscraper was the subject of a public inquiry in 2008 and was approved by the then communities secretary Hazel Blears.
A year ago councillors approved St George's revised plans for the scheme swapping the hotel and residential uses between the high-rise and low-rise buildings.
"Our vision is to contribute positively to the London skyline, to create a beautiful and elegant structure that complements London's historic and contemporary icons such as St Paul's and 30 St Mary Axe," said architect Ian Simpson.
"It is through the creation of new landmarks that London reinvents itself and maintains its global status."
Michael Bryn-Jones, managing director of St George South London, said: "We are delighted that construction is now underway at One Blackfriars and to be contributing to Southwark's vision for the area.
"One Blackfriars will create hundreds of new jobs, homes and a new public piazza, as well as contributing to local infrastructure, public realm and affordable housing."
St George claims that the scheme will create around 200 full time jobs after completion as well as more than 600 jobs during the construction phase. St George is spending £680,000 on local employment and training initiatives, including the employment of 25 apprentices throughout the project.
Southwark Council leader Peter John said: "I am delighted that St George has commenced construction and will transform this site which has been derelict for over a decade.
"The landmark tower will be a fantastic addition to London's skyline and will signpost the gateway to Southwark, signifying the borough's continued regeneration.
"One Blackfriars will make an important contribution to our vision for the transformation of Blackfriars Road supported by the creation of a new landscaped public piazza."