The proposed Crown House development on West Bar will involve the vacant offices being converted into 355 apartments for students at both city universities.
The development, put forward by London and Scottish Student Housing, will sit directly opposite Sheffield Crown Court.
The original office block, built in 2007, has been empty since it went up and the applicant said the plans would contribute to the wider regeneration of West Bar and secure the use of the site.
Preparatory work has already begun. Further building work for student accommodation would go ahead on land between New Street and North Church Street. This area is set to include a landscaped courtyard area and a bike rack. Parking will only be available to Crown House staff and disabled residents.
Planning officers raised concerns about the potential for any new buildings to block out daylight, but said the overall scheme was positive.
A spokesman for London and Scottish said: “The proposal is to convert the empty office block into student accommodation with a mix of studio and two-bed clusters.
“In addition it is proposed to extend the building to the rear with two blocks of purpose-built accommodation and add two lightweight levels to the top of the existing building.
“At ground level there will be an active frontage provided by communal facilities for student use along with retail and leisure units.”
If approved, developers would aim to open the new student block by the start of the 2017-2018 academic year.
A planning report said: “The redevelopment of the site, incorporating and enhancing the existing building, is welcomed.
“Since 2007, the site has had the appearance of an empty, stalled and unfinished project, which in turn has detracted from the appearance of this prominent location. It has also had a negative impact on the surrounding area.
“However, there are a number of shortfalls in relation to day lighting and mobility housing provision but greater weight has been given in this instance to the overall benefits of the site and further justifications have been provided.”
The proposals are recommended for approval at a Sheffield Council planning committee meeting next Tuesday.