Borough planners have announced that Morrisons has been chosen to be the new supermarket provider as part of the multi-million pound Merstham regeneration scheme.
Reigate and Banstead Borough Council unveiled the store plan, saying it will trade as one of Morrisons M local convenience stores.
The supermarket will form part of a development of four shops - with ten flats above them - on the prime council-owned former Iron Horse pub site.
The chain has said it will also mean 20 new jobs will be created.
The borough council agreed to let the store to Morrisons, subject to planning permission, following a competitive bidding process.
The development scheme is due to be considered by the borough's Planning Committee next month, and if approved, work will start on site in January next year.
A borough council spokeswoman said: “Discussions about who will lease the other three shops, and the four new units planned on the 'Triangle' site are well advanced, and further announcements are expected soon.”
Natalie Bramhall, borough council executive member for property and regeneration, said: “The Morrisons M local store will give Merstham residents much easier access to essential groceries and fresh produce at affordable prices.”
Coun Bramhall said: “We also welcome the employment opportunities it will provide. “These things were very important to us in choosing who the new convenience store provider would be.”
Stephen O'Connell, acquisition manager for Morrisons, said: “We’re in the early stages of planning to bring a Morrisons M local to Merstham and look forward to creating 20 new jobs for local people.”
He said: “Fresh food will be at the heart of our offer and we will work hard to make our store a positive addition to the community.”
Key plans for new shops, homes and community facilities in Merstham were submitted by the borough council last month.
The plans are part of a multi-million pound scheme to regenerate the Portland Drive area, in partnership with Raven Housing Trust and Surrey County Council. The ten shared equity flats above the new food store and shops on the Iron Horse pub site are to be built on behalf of Raven, to provide more homes that local people can afford. Another key application in the regeneration scheme is for four more units for restaurants/takeaways and a purpose-built community centre on part of 'The Triangle,' at the junction of Portland Drive and Bletchingley Road. The centre plan includes space for Merstham library, a youth skills centre, training rooms, a café, public IT resources and drop-in advice facilities. Raven has already started building 40 new homes in Purbeck Close - 11 affordable rented, 19 shared ownership and ten for open market sale. It has also secured outline planning permission to redevelop Portland Drive flats and shops to provide 50 market houses and flats. In May, Surrey County Council cabinet member for business services, Denise Le Gal, said the project “promises to deliver real benefits for the Merstham community by promoting economic growth, helping families thrive and creating opportunities for young people." A decision on the applications is expected in early summer. If the plans are approved, developers will be invited to tender to build the schemes, with construction expected to start later this year, with a completion date in the winter of 2015. The plans can be viewed online at Reigate and Banstead Borough Council’s website: www.reigate-banstead.gov.uk They are also available for viewing at the Town Hall in Reigate.