The two buildings on London's famous Old Kent Road will meet the latest government guidelines on high-density housing by creating nearly 140 dwellings.
Divided into two phases, the scheme will feature photovoltaic cells and a lightweight steel-frame walling system.
Project architect David Capener said: 'We have tried to make a visual impact and a high-quality living environment in an area that has suffered in the past from poor quality and low-density urban development.
'The raised podium and courtyard on the first floor provides an oasis for people to walk through and congregate, away from the road area. There will be landscaping within the courtyard to escape from the 'concrete' feel that presently characterises the whole area,' he added.
Jerome Geoghegan, director of the scheme's backer London & Quadrant, said: 'After long negotiations we are delighted that this landmark scheme is taking shape. We are confident that these new homes will be a great improvement to the built environment of Elephant and Castle.'
The scheme is expected to be completed by summer 2006.