Charitable housing association BCHA is intending to develop a mix of 31 new affordable homes and flats off Radipole Lane at Southill in Weymouth.
A planning application for the £4.5m scheme was being submitted to Weymouth and Portland Borough Council this week.
The site is currently occupied by the 25-unit Marchesi House which was originally designed in 1975 as a sheltered housing complex for older people.
Current residents of the building will be offered a home loss and disturbance payment and suitable alternative housing.
The new development will consist of 13 one-bedroom flats in two blocks, 12 two-bedroom houses, six three-bedroom houses and 38 parking spaces.
It has been designed by award-winning Dorset-based architects David James Architects & Partners Ltd.
BCHA has been consulting during the past year with residents, neighbours, stakeholders and the local authority and staged an exhibition of the plans.
If planning consent is granted, work on the site is expected to start in mid to late summer 2019.
Stacey Northover, BCHA Assistant Director of Housing, said: “Our £4.5 million investment will help address the area’s housing needs through this much-needed, quality development of affordable, rented and shared ownership homes.
“We listened carefully to views expressed during the extensive consultation process on issues such as parking, design and landscaping to ensure this development fits in well with the existing surroundings.
“We understand the sensitivity surrounding any new development and this mixed scheme of single, family affordable rented housing, as well as shared ownership options will ensure a positive impact into the community.”
“Our current residents are being kept informed throughout this process with regular updates and explanatory one-to-one meetings about the process. Their future housing preferences are of utmost importance.”