Work can finally start next year to transform a derelict 20-acre site into a £150m urban village, after the last legal hurdle was cleared.

The New England Consortium can go ahead with plans for a controversial Sainsbury's superstore, two hotels and homes for more than 1,000 people on land next to Brighton station.

Brighton and Hove City Council granted permission in principle last Christmas to redevelop the land, which is Brighton's largest brownfield site but has been derelict for 40 years.

However, it has taken until now for a complicated legal agreement to be finalised, including dozens of conditions.

Project manager Chris Gilbert, from the Sussex-based firm QED, said: "I am delighted. We are hoping to start work on the site early next year."

Protests against the scheme were prompted by the prospect of the large Sainsbury's supermarket, the main revenue generator.

Opponents, who feared huge pollution and congestion problems, say they will be watching enforcement of planning conditions closely.

Keith Taylor, convenor of the city council's Green Party group, said: "We look forward to working to make sure we get the best possible deal in terms of community facilities in the next stage of the development."

Ben Messer, of pressure group Brighton Urban Design and Development (Budd), said: "The concern is the developers will try to wriggle out of the conditions if they possibly can and we want to make sure the goalposts are set in stone."

He felt Budd's campaign had already ensured the development would be less damaging than originally intended and everybody involved should be pleased.

One of the proposed hotels would be four-star, offering 250 beds, while the other would be three-star with 150 beds.

Neither will offer car parking.

The homes will be flats and houses, with 30 per cent of them low-cost.

The redevelopment will also include a language school for more than 1,000 students, a replacement station car park with 600 spaces on two levels, a training centre, a community centre, workshops and open space.

There will be a greenway to run through the site along the old railway line and up to the listed railway bridge on New England Road.

A new road will divert through traffic away from part of New England Street and link to the station drop-off area.

New England Street will be partly pedestrianised next to St Bartholomew's School.

The new Sainsbury's store will lead to the closure of the company's supermarket in London Road.