The development project will be led by Stanhope and Hutchinson Whampoa Property, working with London Underground.
Sir Terry Farrell said that a landmark mixed-use development scheme had been created for a challenging site. He said the scheme provided a multi-modal transport interchange, modern retail and residential space. Social housing has been ruled out because of the costs involved in redeveloping the site.
David Camp, chief executive of Stanhope, said that the proposal addressed the long-standing blight of the station. He said the scheme marked the star of the area's regeneration.
At ground level the South Kensington site has remained undeveloped since the 1970s when the installation of escalators for the deep-level Piccadilly Line led to the demolition of most of the buildings fronting Pelham Street.
A consent for a station in 1997 had not been implemented because the associated commercial development would not have funded it.