Demolition workers have begun knocking down the former tannery in Barker Street in preparation for the creation of student halls for University Centre Shrewsbury.
The move has been widely welcomed with the existing buildings being described as an "abomination" on the landscape of the town.
When the project is completed it will include three new buildings which will become home to around 200 students attending the university.
University officials have spoken of their excitement at seeing the delayed project finally getting off the ground, with Paul Kirkbright, University Centre Shrewsbury deputy provost, last month describing it as another important step for the institution.
He said: “This first-class student accommodation being constructed by our partners at Shropshire Council is within sight of our main teaching centre.
“This is another significant step in the development of University Centre Shrewsbury, one that we’re confident will bring long and lasting benefit to the people of Shrewsbury and Shropshire.”
Tim Smith, head of business, enterprise and commercial services, with Shropshire Council, said: “This new accommodation will support the redevelopment of the west end of Shrewsbury town centre and will be a significant improvement for the area.”
The plan for the site was originally to have three separate blocks which would provide student accommodation,however, earlier this year council officials admitted that the development may now include some form of retail as well.
Speaking last month Steve Law, strategic asset manager for Shropshire Council, said: “The plans for student accommodation at The Tannery site are currently as per the planning permission granted in 2015.
“Like any construction project the process of detailed design development, which is underway, is considering potential amendments and enhancements and these will go through a process of review before the final design is agreed.
“No decisions have been taken in relation to incorporating an element of retail but this is one option that could be considered for the final scheme.”
When the demolition of the site was originally approved in September 2015, Councillor Peter Nutting, who is now the authority's leader, said it would allow Shrewsbury to rid itself of one of its architectural eyesores and look to the future.
He said: “Everyone knows this building is an abomination that needs ripping down. We all agree it needs to go and the sooner it does the better. Let’s get on with building things for the future.
“The site is very important for the town and it is important that whatever is built there now is of the highest quality.”
The demolition of the buildings was also proposed as a means to improve the area by Shropshire Council's planning officers.
In the report recommending councillors approve the demolition work officer Jane Raymond said: “The existing building is a modern 20th century building of no architectural interest or merit and it is considered that its loss will enhance the appearance of the area.”
The development was originally approved in 2015 with the intention of being completed for the start of the 2016/17 academic term.
However, it was placed on hold in February 2016 while assessments were carried out on the number of students expected to join the university.
In December the project was finally given the green light when former council leader. Malcolm Pate confirmed the the go-ahead, with the university forming one of the central parts of the council's economic growth strategy.
Shropshire Council is already responsible for university halls in Shrewsbury at Mardol House, which it refurbished in time for the arrival of the fledgling institution’s first undergraduates.