In a statement the Australian company said it had reached agreements with the Olympic Delivery Authority and other agencies to build a 1.9m sq ft project called Stratford City, which will be the biggest shopping mall in London.

The agreements relate to the delivery of land, development rights and the provision of infrastructure, utilities and services to Stratford City and the Olympic facilities.

The scheme will be built to some of the highest environmental standards applied to a major development in Britain.

Retailers John Lewis, Waitrose and Marks & Spencer will anchor the development. 

Frank Lowy, chairman of Westfield Group said:
"The £1.5 billion Stratford City retail and leisure development has both scale and significance, serving as a gateway to the Olympic Park and delivering real momentum to the regeneration of east London.

We anticipate significant transformation flowing from the 2012 Olympics with Stratford City becoming the metropolitan centre of east London."

Work is expected to begin immediately with completion scheduled for 2011.