The new phase of Canary Wharf development will deliver 3,500 homes as well as offices, shops leisure facilities and create new jobs in the building trades.
The scheme has been planned for more than a decade – but this government funding boost will enable work to finally get started.
Communities Secretary Eric Pickles said: “London’s Docklands have been completely transformed in the last 20 years into an exciting place to live and work.
“Today’s £200 million deal will ensure this continues long into the future with the development of Wood Wharf, delivering thousands of homes as well as job opportunities.”
The Mayor of London, Boris Johnson said:“This funding will help to accelerate the regeneration of a currently derelict brownfield site into a brand new community.”
Under the terms of today’s deal, the Canary Wharf Group will receive a £200 million loan from the government to provide the infrastructure needed to unlock the site to the east of the existing Canary Wharf estate, including the relocation and upgrading of utilities for the site.
The funding will also make it an attractive place to live and work by funding a network of parks and public squares, as well as improved road and pedestrian access.
It will mean work can then get started on delivering 3,500 homes, including 607 affordable homes, as well as 2.8 million square feet of offices, shops and community facilities.
These proposals have already got planning permission, so work will be able to start within months.
Andy Rose, chief executive at the Homes and Communities Agency, said: “The £200 million contribution to this project will accelerate the infrastructure needed to boost this vital centre for business activity by unlocking land to establish Canary Wharf as a residential location, building the homes that London needs to supply viable housing developments.”