Housing association East Thames has been named as Barking and Dagenham Council's regeneration partner for the eastern half of Barking's Gascoigne estate.
The authority said East Thames would be an equal partner throughout the project, sharing responsibility for funding, design, construction and maintenance.
Under the scheme’s first phase, 364 homes in four tower blocks and four low rise blocks at St Margaret’s are being demolished for replacement with a mix of social rented, affordable rented and privately-owned homes.
The second phase, scheduled to start transferring tenants during 2014, will see a further 934 homes demolished and replaced with new properties.
The council's housing lead, councillor Mick McCarthy said redeveloping the Gascoigne estate had been a long-term ambition for the authority.
“I’m very happy that vision will soon become a reality,” he said.
“I hope that local people will take the opportunity to give their views on the future of the estate when we get to the masterplanning stage.”
East Thames development director Geoff Pearce said: "Our work will do more than just provide new buildings. It will create a healthier, happier and more vibrant community where people want to live."
The City of London Corporation is about to buy Barking Power Station site in east London for around £125 million, according to Property Week.
A £25 million grant for Barking and Dagenham Council will help it support new housebuilding over the next four years.
Councillor Darren Rodwell, the leader of Barking and Dagenham Council, has welcomed the decision to approve the proposed Beam Park…