The development on a brownfield site in the Cornhill area of the town will include 26 homes for affordable rent and 16 for shared ownership. There will be a mixture of one, two and three-bedroom homes.
The development will be built by Classic Builders.
The 42-home development includes a listed building that was severely damaged by a fire in 2008 which is being repaired and converted to provide four new homes.
Adam Preece, New Business Manager for LiveWest, said: “Residents and businesses in Wellington will be only too familiar with the burned-out, derelict buildings on Cornhill and the wasteland adjoining North Street car park.
“We’re confident that this scheme will revitalise Cornhill and bring a renewed vibrancy to the area at the same time as providing a mixture of affordable homes right in the heart of the town.
“The new scheme has been carefully designed to respect Wellington’s heritage and to complement the town’s many fine buildings.”
The development will benefit from grant funding from government housing agency Homes England and further funding from Somerset West and Taunton Council.
It is the culmination of a three-year partnership between Freemantle Developments and LiveWest to find a solution to the site.
The development will take 18 months to build and work will get underway this week.
Nick Warfield, Managing Director of Freemantle Developments, said: “We are very pleased to have the opportunity to work on this project having been asked to assist the landowners with advising options for developing the site.
“We drew up a suitable scheme in order to reinstate the listed buildings and also bring into use significant overgrown unused brownfield land. The project came with many challenges that we have been able to overcome.
“Early into the concept stage of the project we had discussions with the housing enabling team at Somerset West and Taunton Council (formerly TDBC) who have been very enthusiastic and extremely supportive.
“Between us we have been able to work up a scheme that meets all of the Council’s, and most importantly, the town council’s objectives.
“We were particularly encouraged with the really positive meetings we had with the town council. We are looking forward to delivering this project to completion and hope it to be as successful as our many other projects.”
Cllr Fran Smith, Executive member for Housing at SWT, said: “Schemes like this are really important for SWT, better utilising a prominent brownfield site by building a range of high quality energy efficient new homes to meet local need.
“We’re proud to have worked with LiveWest on this project that supports our priority of providing much needed affordable housing options, enabling local people to stay in the area and make Wellington their home.”