The development will have a mix of 85 private and 84 affordable homes. The scheme will also provide 8,534 square metres of private gardens, public open space and shared residential courtyards.
"The development will provide a wide range of planning benefits for the site and surrounding area," said the Council's executive member for regeneration and strategic planning, Conor McAuley in a statement. "It will transform this key brownfield site which has lain vacant and closed to the public since 2007, creating a unique landmark cluster of high quality buildings."
"Newham is a forward-looking council, which is committed to some of Europe's biggest regeneration projects. So far, two billion pounds of investment have been committed to transforming Newham. We have the ambition and the vision. This development is a good example of how we are determined to make that vision a reality," McAuley said.
The scheme is designed by architect PCKO, which won an architectural competition launched by Peabody to celebrate its 150th anniversary.
"As part of Peabody's 150th anniversary celebrations we undertook an architectural competition for the Plaistow Hospital site and we are now delighted to see PCKO's winning entry be approved by Newham," said Peabody development director Claire Bennie.
Peabody said that construction work will begin on the site in March with the new homes completing in 2015.
