The council was working in a joint venture with John Laing to transform the Taberner House site into 418 homes.

But the council is now going it alone using its own recently launched development company to progress the scheme across four residential blocks rather than the originally planned five.

Croydon said: “As well as giving the council greater control over the scheme, the new development company approach is expected to more than double the council’s forecast financial return.”

Revised plans for the Taberner House site are due to be submitted for planning permission later this year with construction work expected to begin on site early next year.

Councillor Alison Butler, deputy leader and cabinet member for homes, regeneration and planning said: “Delivering Taberner House through the development company gives the council direct control of the scheme, enabling us to provide more affordable homes.

“With severe cuts in government funding, we have to look at innovative ways of generating revenue while providing essential public services.

“By taking a more proactive approach and delivering schemes through our development company, the council will be able to secure profit that would previously have gone elsewhere.

“This scheme will not only provide more much-needed homes but create improved public space in the centre of Croydon.”