The planning application was submitted in March this year to build 33 new homes at the land in Hempsted, including eight one-bedroom flats and 25 two-bedroom flats, with a car park for up to 50 vehicles.
Each apartment would be provided with "spacious bedrooms, living areas and dedicated storage space".
The development is 3-storey in scale, providing a step down in scale from the adjoining buildings at Hempsted Local Centre, to the existing residential buildings to the rear.
In the application, Mr Dan Gooch of Minister Property Group, wrote: "There is an urgent need to provide new affordable housing in Peterborough which is currently not being met through the provision of S106 affordable housing in connection with market housings developments.
"The SHMA (Strategic Housing Market Assessment) Update published in October 2015 identified affordable housing need of 620 houses per annum in Peterborough – at that time 68% of the overall housing need derived from demographic projections.
"There has been no more up-to-date SHMA published since that time, but in in line with national trends it is highly unlikely that the need for affordable housing has become less acute. In this context of urgent need, the delivery of 33 high quality affordable homes in a sustainable location is a material consideration that lends very substantial weight in favour of the proposed development. It is strongly in the public interest to secure the delivery of the scheme."
Head of Planning at Peterborough City Council Nicholas Harding approved the new homes with various conditions including the clause that work must start within three years.