Developers will provide a minimum of 15% affordable homes, and invest £8m in local road improvements, build a new primary school and improve local community facilities.

The overall plans for the Quays, which have finally been approved, include a new £5m link road from Barry town centre to Barry Island, an hotel, supermarket and a waterfront district centre featuring cafés and restaurants, as well as up to 2,000 new homes.

A resolution to grant planning permission for the 43ha brownfield site was unanimously agreed in July last year by the Vale of Glamorgan’s planning committee subject to completing the S106 agreement.

The site presents significant construction challenges, including some major decontamination and flood prevention measures, which means that it could take up to two years to complete the full remediation works.

These works will be phased to allow the first residential and commercial buildings to be completed by the end of 2013.

Barry Waterfront Consortium spokesman Richard Keogh, said: “This is a massive investment in Barry, with wide-ranging benefits for the town and its surrounding areas.

“Not only will the scheme help regenerate derelict land, but it will also create jobs, drive economic growth and hopefully encourage further investment in the area.”