The agreement has been signed with landowners Southampton City Council, Associated British Ports and The Crown Estate and will now see the submission of a planning application for a comprehensive mixed-use development of the site.
The existing listed Royal Pier has been derelict for years following fire and storm damage.
A full mixed-use development will be built on the 32 acre site adjacent to the City Walls and Port of Southampton.
The project will be delivered in phases over a number of years to include offices, hotels, leisure, food, drink and retail alongside a residential development of waterside apartments.
Simon Letts, Leader of Southampton City Council, said: “We are very excited by these proposals.
“The Royal Pier Waterfront development is the flagship project in our overall plan to further enhance our city’s reputation as a first-class destination to live, work and visit”.