The site of the former Wolverhampton Royal Hospital is to finally be redeveloped as new housing.
It has been bought by the Homes and Communities Agency (HCA) after plans to transform the building into a new flagship Tesco store were shelved last year.
The HCA now has 12.5 acres to develop, with the plot also including a former bus depot and other land.
In addition to building new homes, the listed buildings on the site may be redeveloped to become a new campus for Wolverhampton College.
The HCA's executive director for the Midlands Karl Tupling said: "We look forward to working in partnership with the City of Wolverhampton Council to secure a planning consent on the site which will deliver much needed housing."
Tesco abandoned plans after it suffered a sharp dip in sales, leading to the abandonment of a number of projects to build new stores and the closure of many existing outlets.
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