CPC Group and Qatari Diar have submitted their planning application for the redevelopment of Chelsea Barracks.
The purchase of the Ministry of Defence (MoD) site in November marked the first European investment for the state-owned Qatari Diar.
The developer has proposed to build 638 residential units at the site along with retail units, a community pool and sports centre.
"This is going to have a massive impact on the city’s economy and the rental values in London," Nick Candy told Property Week.
The MoD owns significant amounts of property in the capital and itsoffices in London are situated in Whitehall, next to the Thames.
The department also recently sold Bentley Priory to the commercial sector, which will also be developed as residential accommodation.