A report to the city council's housing, Dundee Contract Services and environment services committee on Monday recommends an agreement with Hillcrest Housing Association that will provide a new building.
Committee convener Councillor Jimmy Black said: "A housing development is proposed for the site at Ann Street and it will be a 12-flatted building, with our successful bid to the Scottish Government for new council house building providing £240,000 towards eight of the units.
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"This will greatly enhance the area because it will be on a derelict site and I am sure that local people will welcome the development.
"They will be modern, very energy-efficient homes that will help people reduce their fuel bills and the new building will have a lift and the council flats will be wheelchair accessible. This will help the council improve its provision of adapted homes."
The site is adjacent to properties owned by Hillcrest Housing Association, who had wanted to develop the site, but had been unable to do so because of lack of resources within the Affordable Housing Investment Programme.
If the agreement with the association is approved next week, they will take on the development function.
(GK)
