Birmingham’s £450m regeneration programme for its city centre has taken a step forward with a funding allocation of £63.1m approved for the first phase of the project.

The Paradise Circus project was one of the UK’s largest city centre outline planning applications approved last year and will include up to 10 buildings in 17 acres of land between Centenary Square and Chamberlain Square.

The funding was approved on 14 March by the Greater Birmingham & Solihull LEP (GBSLEP) board – representing a partnership of businesses, local authorities and the education sector.

The development covers an Enterprise Zone – one of 24 nationwide developed as part of a 2011 government initiative to support new and expanding businesses.

Generating up to 12,000 jobs, the mixed-use development will include offices, shops, leisure and cultural facilties, civic amenities, and a replacement for the existing Copthorne Hotel.

Pending detailed planning approval – due to be decided next year – construction is expected to begin in autumn 2014 and the first phase completed in 2018. The entire transformation is expected to be complete by 2026.

The Enterprise Zone is expected to create a net growth of £180.5m in business rates over its 25-year lifespan, which the council will be able to reinvest in new regeneration projects.

Birmingham City Council’s cabinet is set to approve the full business case for the development at its meeting on 25 March.