Earlier this month, the government announced a £866m investment in local housing projects, which is expected to deliver up to 200,000 new homes.
The council – in partnership with developer Crest Nicholson – submitted its bid last December.
It is aiming to transform the King Alfred Leisure Centre into an extended and modern sports facility as part of a major mixed-use scheme.
Crest Nicholson is working with Starr Trust on the project, which will include community space and plans the provision of 560 flats in four blocks, of which 20% will be available as affordable housing.
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Proceeds from the sale of the private flats will be used to fund a new public leisure centre.
Council leader Warren Morgan said: “We’re massively pleased and proud to have submitted a bid which has won the second-largest single sum in the country.
“It speaks volumes for our commitment to providing the housing the city desperately needs, alongside a first-class leisure centre.
“We have achieved a very significant step forward after years of difficulty getting this project off the ground.”
The council said that it hoped a planning public consultation would commence by mid-2018, followed by a planning application later in the year.
Once contractual arrangements are finalised, details of the longer-term programme will be published.
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