Neptune Developments has submitted a planning application for the £6.4 m redevelopment of Chester's Shot Tower and Lead Works to create 53 residential units above leisure and retail facilities.
Neptune is working with Chester & District Housing Trust to transform the Grade 2-listed former lead shot mill into modern premises while retaining historic features.
Steve Parry, managing director of Neptune, said: "We are delighted to be moving forward with this exciting scheme. This will bring an interesting part of Chester's heritage back into use and bring much needed affordable housing onto the market."
Architects Broadway Malyan designed the scheme, continuing its relationship with Neptune, for whom the practice also designed Mann Island in Liverpool.
The residential element of the shot tower will be a mixture of one-, two- and three-bedroom apartments which will be available for affordable rent and sale. On the ground floor there will be a mixture of leisure and retail units and a small visitor centre.
Chester Shot Tower was built in 1799 and is the oldest remaining shot tower in the country, with only two others still standing. It is also currently the tallest structure in Chester, standing at 168ft tall. The Shot Tower worked by dropping molten lead through a copper sieve at the top of the tower and the falling drops would form balls of lead shot for muskets. These were used in the Napoleonic Wars and onwards. Work stopped on the site in 2001.
Subject to the planning process, it is hoped work can begin in site in the summer of this year and the scheme would then be completed in the summer of 2013.
Matt Brook, director of Broadway Malyan said he hoped the scheme would "provide the high-profile shot tower with a new urban purpose and create a catalyst for the regeneration of the wider area."