The Shrewsbury Entertainment Venue - a scheme which includes a 650-seat auditorium - looks set to become reality following backing from regional development agency Advantage West Midlands to the tune of £1.8 million.
The funding means that Shrewsbury and Atcham Borough Council can now purchase the final piece of land at the Frankwell Quay site.
The scheme is to be built alongside the Welsh Bridge and in addition to the main auditorium, it will include a 250-seat studio theatre, dance studio, cafe bar and meeting and function rooms. Planning permission has already been granted for the project.
AWM believes the new facilities will attract an exciting range of artists and performers to Shropshire.
Mark Pearce, director for Shropshire at the agency, said: "The new Shrewsbury Entertainment Venue will provide a catalyst for a number of exciting regeneration activities on the banks of the river, including hotels and restaurants, all of which will add value to the economic regeneration and wealth of the area." Coun Charles Armstrong, portfolio holder for culture and leisure at Shrewsbury and Atcham Borough Council, said: "This is a landmark funding package.
"Unlike other million-pound grants we have received for sports and community development from AWM and other bodies, this major grant recognises the long-term economic importance of the package."