Hume mayor Ros Spence said the 65-hectare project will include a residential development.

"Hume City Council has been working closely with Lend Lease for more than 18 months to ensure we get the best possible outcome for our community," she said.

"[It's] not only for the current needs of our growing community but for the future generations of families in the area."

The development will move away from 'mall-only-style' centres to a main street with both active street frontages and internal areas.

It will incorporate supermarkets, discount stores, leisure and entertainment venues and restaurants.

Lend Lease head of retail development Gary Horwitz said the project was good news for the community.

"Working with the Hume City Council, we will ensure the Craigieburn Town Centre builds on the character and lifestyle of the local area so there is a strong connection to facilities and services," he said.

"Our aim is to provide an active, lively and safe place for quick and convenient shopping along the lines of what you would experience on a traditional high street."

Work on the centre is expected to be completed by Christmas next year.