A 58-bedroom hotel and seven restaurants will form part of the £75m Elwick Place development in Kent, after Stanhope PLC was granted planning permission last year.
Ashford Borough Council has agreed to fund the construction of the town centre leisure complex, which will also include a six-screen cinema and retail units.
The 6.42-acre complex will be built on a vacant brownfield site in Ashford town centre, which previously housed the town's cattle market.
The council acquired the site last year and will own the development once completed.
Leader of Ashford Borough Council, Gerry Clarkson, said: "This investment, and our continued commercial approach, has the potential to significantly contribute to our ability to be self-reliant despite reduced government funding. We firmly believe that enabling this regeneration project to be brought forward quickly is in the best interests of the borough. This investment will enable services to be maintained, and will also continue the revitalisation of Ashford town centre.
"Taking this bold decision underlines the importance of the town centre to the council and shows residents, existing businesses and those considering Ashford as a location for their business, that Ashford is a place of positive action with a can-do authority that continues to place its faith in a revived and reinvigorated town centre both during office hours and into the evening. These really are exciting times for Ashford."
The scheme is expected to create 250 jobs.
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