Manchester City Council has announced central Government has approved the latest stages of a Private Finance Initiative aimed at regenerating housing in Ardwick, Greater Manchester.
In November last year, the Government confirmed its continued support for the £113m Brunswick Private Finance Initiative project, subject to a rigorous value for money assessment.
The council and the two consortiums bidding for the PFI contract, Fern and Solutions 4 Brunswick, have all been working towards saving £4.9m for the project.
Fern Consortium is made up of not-for-profit housing association Harvest Housing Group and building company Gleeson.
Solutions 4 Brunswick consists of Contour Housing, building company Mears, which would refurbish the council-owned homes in the area, and Galliford Try and New City Vision.
The latest green light from the Government now means that the council can work through the final PFI approval stages.
The council said it will submit a further business case to Government later this year and will finalise its evaluation of the PFI proposals moving towards selecting one of the partners in early 2012 with the first improvements starting later that year.
The Brunswick Private Finance Initiative will see investment being put towards transforming part of Ardwick, located about a mile from the city centre, south of the Mancunian Way between Upper Brook Street and Ardwick Green.
The 25-year PFI contract will see more than 600 council homes modernised, up to 500 new homes built to rent or buy and the layout of the neighbourhood improved.
In addition, a new local housing office, a 60-bed sheltered accommodation facility and shops will also be built.
Cllr Paul Andrews, executive member for neighbourhood services at Manchester City Council, said: "We have been working with residents for many years to deliver this project. This is long-awaited news, an important moment for the area and we can't wait to get to get things moving.
"Brunswick has a lot going for it including a strong community and a location on the doorstep of the city centre. By improving its housing, its design and its environment we believe we're on course for a successful future for the area."
In order to make improvements and transform Brunswick, the council said it will need to demolish some properties, but added everyone affected by the redevelopment, who wants to stay in the area, is being given a guarantee they will be rehoused there.