A high profile Birmingham regeneration scheme that faltered as the economy collapsed has been given fresh hope after landowners submitted new plans and the Government pledged funds to kickstart stalled projects.

The 22.5-hectare Icknield Port Loop site is currently owned by British Waterways, the Homes and Communities Agency (HCA) and Birmingham City Council, which want to create a new canalside district including 1,150 homes, shops, a landmark ten-storey hotel, park and playground and a pub.

The area was identified in the Big City Plan as a key regeneration area when Advantage West Midlands tried to sell its holding and launched a competition to find a developer, but the process stalled due to the recession and the holding has since been passed to the HCA.

The site in Edgbaston includes various industrial premises, the majority of which are vacant and the site of the Ladywood Arts and Leisure Centre.

According to a presentation to the city council’s planning committee by Peter Weatherhead of planning agents DTZ, the aspiration is that family homes will be designed in three waves and densities, with two and three-storey family homes on the arts centre area rising to an eight-storey apartment block at the centre of the development.

The Icknield Island and Wiggin Street area would see “innovative” medium density terraced housing, including the possible return of back-to-back housing to Birmingham.

The former Tube Works on the corner of Rotten Park Street and Icknield Port Road, will be retained and redeveloped and a former stables block on Rotten Park Street will be turned into a community building.

But the application suggests that an attractive Art Deco 1932 garage is in such a poor state of repair that it should be demolished.

Mr Weatherhead said that the site had been awaiting development for almost a decade.

“This proposal will create a sustainable urban neighbourhood and place where families will want to live. The community wants something to happen and should we receive planning permission the developer will be able to deliver that vision,” he said.

As well as the new planning application, the project has been given a further boost after the Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP) successfully applied for a £15m grant from the Government to support infrastructure in projects which support homes, jobs and growth as part of its Growing Places initiative.

While a decision on what projects will receive cash will not be made until February 23, it is believed that Icknield Port Loop is considered one of the schemes that would offer the greatest return on an investment.

Paul Heaven, LEP board member and founder of Blue Sky Corporate Finance, led the work to secure the funding.

He said: “This is not about the GBSLEP undertaking development, rather it is about us working together in partnership with local authorities and developers to unlock the economic potential of key development sites.

“The key aspect of this work is having projects ready that can deliver quickly and deliver significant returns in terms of return on investment and the scale of growth.

"While we still have to complete the due diligence to determine which of the projects will receive the funding, we are confident not only will the successful schemes make a huge impact, crucially they will be able to start almost immediately.

“Now we have approval from the Treasury and will receive the funds we can begin the process of finalising which projects are going to go forward in round one of the Growing Places funding allocation.

“We are well positioned having worked with local authorities involved in the LEP as well as our neighbouring LEPs to identify ‘shovel ready’ projects set to start on site by the early summer, meaning by the end of the year we will be able to see real progress and a pipeline of new exciting developments coming forward.”

Coun Timothy Huxtable, Cabinet Member for Transport, Environment and Regeneration at Birmingham City Council, said Icknield Port Loop had the potential to set a new benchmark in the city’s urban regeneration.

He said: “Greater Icknield has the potential to play a major part in meeting the city’s challenging Growth Agenda.

“It is anticipated that the area will provide 6,000 new homes within a sustainable urban neighbourhood, where new family-based models of urban living will be explored as well as a full range of community facilities, local shopping and working opportunities, and better quality streets, parks, squares and gardens.

"A framework is being developed to realise this vision of the area becoming Birmingham’s first such neighbourhood. It also aims to address social, economic and environmental sustainability needs through its land use, environment and open space proposals.”