Gateshead Borough Council has signed an agreement with Tesco's Spenhill Property arm for the redevelopment of a 3.5ha site in the town centre, including the demolition of the remains of the much hated "Get Carter" car park.
Spenhill will now submit a planning application for the site including a replacement store and other shops, offices, student housing, car park and public open space.
"Gateshead town centre has been in need of regeneration for some time and we've sought research and recommendations over recent years on how we should go about delivering a town centre that will be a great place for visitors and local people," said Council leader Mick Henry.
"This agreement follows careful but complicated negotiations in which we have both taken into consideration economic change, changes in shopping habits, how and when people travel and what they expect from visiting an urban centre. Our ambition is for a development that would offer more facilities than simply replacement retailing and have a major impact on the regeneration of the town centre - we hope to receive a planning application soon."
The move follows finalisation of a master plan for Newcastle and Gateshead.
"The development agreement signals our confidence in the future prosperity of Gateshead," said Spenhill corporate affairs manager Doug Wilson.
The car park achieved fame by appearing in the 1960s film Get Carter but its demolition was halted by architects who argued it had merit.
