Work will start on new 18 and 26-storey towers in Woden in the first half of this year, after the ACT government gave the green light to the project last week.
The $200 million joint venture between Canberra developers Zapari and Geocon will see the high-rise mixed-use development, to be called Grand Central Towers, built on the site of the former Medibank building and alongside the Woden bus interchange.
The development, at 15 Bowes Street in the Woden town centre, will be home to 430 apartments across the two towers with commercial space on the ground floor.
Zapari managing director Nick Skepev said the development would make the most of its proximity to the Woden bus interchange and stage two of the Canberra Metro light rail project.
"After an extensive community consultation process, working collaboratively with the ACT government, local community groups and businesses, we're proud to announce development approval," Mr Skepev said.
"The development has taken inspiration from Grand Central Terminal and New York's restless energy and inventiveness, bringing a new calibre of living to Woden."
He said Grand Central Towers would "transform the Woden we know today".
The development application was lodged in May 2017 and approved last week. Following public comment, the number of units dropped to 430 from 448 and additional ground floor space has been made to address the future pedestrian movement.
The height limit for the area is 16 storeys under a draft variation to the Territory Plan, but the application by Zapari Group noted the block abutted an area earmarked for building height limits of 24 storeys. The new 26-storey building will rise 85 metres above ground level.
The nearby 25-storey Lovett Tower is 93 metres tall.
The developers' application said the "proposal should be considered on its merit as having the potential for Canberra's first true transit-oriented development".
Grand Central Towers will have a mix of one, two and three-bedroom apartments including some larger units at 140 square metres. It will also have a sky garden with a pool and deck on level five and another garden on level 15.
It will include 382 car spaces.
Geocon managing director Nick Georgalis said development was driven by stage two of the light rail.
"The ACT government's approval of this development application shows confidence in the Woden Town Centre," Mr Georgalis said.
He said market research showed the vast majority of Canberrans agreed density made sense in town centres.
"More residential development here will activate the location, having people around day and night, instead of being a ghost town at 5pm when all the workers leave to go home," he said.
"Plus, a direct route into the CBD on the light rail makes it an increasingly desirable place to live."
The towers will be sold by Geocon in-house, with expressions of interest opening on Wednesday.
Demolition of the existing buildings will start in the first half of 2018 and the first residents are expected to move in by late 2020.