Work to transform derelict Apsley buildings into brand new council housing has begun this week.
The demolition of 175 to 189 London Road will lead to the creation of 36 new homes, with the first tenants expected to move in by the end of next year.
The redeveloped site will also see space for two new retail units.
The construction is being carried out by contractor Hill Partnerships on behalf of Dacorum Borough Council, as part of a £14 million new build programme featuring the 41-bed homeless hostel currently being erected in Redbourn Road.
The council’s group manager for strategic housing Julia Hedger said: “This is such good news for Hemel Hempstead.
“It will create much needed affordable homes and offer new retail space for local businesses as well as contributing to making the street-front much improved.
“The site has been derelict for years so we are pleased it will now be put to good use.”
The wider programme will see 71 homes and the homeless hostel completed in 2015, with a further 1,000 affordable homes to be provided in the borough by 2020.