139 Greys Ave is set to be demolished and rebuilt, with tenants expected to move in at the end of 2021.
Housing Minister Phil Twyford says the Government and Housing New Zealand will work towards an "exciting, ground breaking project" in Auckland's CBD.
The current structure at 139 Greys Ave, near Aotea Square in Auckland's city centre, will be redeveloped into a 280-unit complex, aimed at providing a home for thepeople who need it most.
"It's about providing a warm dry secure over people's heads when they need it," Twyford said.
The block of state-housing flats have been in a state of disrepair for years.
The 3918sq m block was once labelled a "slum" and there were reports of gang activity, stinking rubbish, dangerous flooring and filthy public areas, as well as a number of security concerns.
