Consent has been given for a £13m mixed-use regeneration scheme on Friargate in Preston.
Developer Portergate's plans include shops and a total of 261 student bedrooms, including six one-bedroom studios, in 62 clusters.
Manchester architect Leach Rhodes Walker will design "attractive open space areas" at the one acre development.
Construction work is expected to begin before the end of the year, with accommodation scheduled to open to students in the 2014/15 term.
The one, two and three bedroom studio apartments are aimed at post-graduate students and apprentices working in Preston's high-tech manufacturing sector and new Enterprise Zone.
Portergate, Hyde, is also working on the £7m Riverside House student accommodation development in Salford.
The five-storey, 242-bed site will be home to students from the University of Salford from the start of the new academic year.
Portergate plans to roll out its boutique student living concept across the North West.
Chairman Anthony Jackson said: "We will play a major role in transforming the fortunes of the Friargate area and this development will encourage further investment.
"We are creating high-quality boutique student accommodation in stylish, contemporary buildings, along with modern retail units that will give a fresh look to this part of Friargate.
"It's something we know is welcomed by retailers on the street who are looking for improvements to the area.
"As a company we are very passionate about what we do and we want to provide a new development that will be attractive to students from the UK and overseas and which will also add real value to the community."