Southwark Council is consulting local residents on plans to build 36 flats in an eight-storey block at the corner of Old Kent Road and Penry Street.
The council proposes to redevelop the former Total and Jet petrol station which is currently used as a car wash.
The development is part of Southwark's scheme to build 11,000 new council homes around the borough.
The 36 flats to be built on Old Kent Road would include a mixture of private and council homes.
The scheme is part of the Southwark Regeneration in Partnership Programme which will be built by a private developer working with the council.