The foundations are now being laid for more than 800 homes and new office space on the Shell Centre site in Waterloo.
Southbank Place is being developed by Braeburn Estates – a joint venture between Canary Wharf Group and Qatari Diar Real Estate Investment Company.
The Shell Tower will remain the centrepiece of the site, framed by a cluster of seven residential and business buildings which will be constructed in phases from now until 2019.
"Today is a historic milestone for the Southbank Place development, as we lay the foundations for this new destination in London," said Khaled Al-Sayed, group chief executive of Qatari Diar Real Estate Investment Company.
"With exceptional new homes, innovative, efficient office spaces and exclusive retail elements, this once neglected space will set the standard for mixed-use developments.
"Local stakeholder engagement is playing a vital role in helping to ensure Southbank Place benefits the local community and creating a landmark destination that will enhance the London skyline for years to come."
Sir George Iacobescu of Canary Wharf Group added: "Southbank Place is also playing a major role in the development of the local community by creating new jobs, providing affordable housing and stimulating the growth of local businesses through our South London Procurement Network initiative."
Last month new hoardings were installed around the Southbank Place development featuring designs created as a result of a collaboration between local children and a respected Lambeth-based artist.
Pupils from Walnut Tree Walk Primary and Oasis Academy South Bank in Lambeth have been working with typographer, designer and letterpress practitioner Alan Kitching.
Alan Kitching said: "Community involvement is instrumental in helping people to become emotionally invested in their local area and achieving a sense of value of home and place.
"It has been a real joy to share my artistic methods with the students during this project for Southbank Place and to bring some of their fantastic ideas to life."