Plans for the site, which is dominated by excavation works, include a 310-property residential development, mixed-use commercial zone with offices and entertainment space and significant retail space.

Yarra Ranges councillor Richard Higgins said it was necessary to rezone the land from its part industrial and business category to mixed use zone.

"The site has been a blight on the local landscape for too long. The amendment is crucial to turning this hole in the ground into something positive for the community."

Part of the amendment will include a development plan overlay at the site which will set broad design requirements for future development but give the community some certainty about what would occur.

About 800 properties in the area have received written notification of the amendment, which can also be viewed on the council website.

The Lacola site is bounded by Old Melbourne Road, Maroondah Highway and Kimberley Drive.