Two five-storey Georgian townhouses currently owned by Southwark Council are set to be auctioned off next week.
The properties at the junction of Park Street and Redcross Way, which is part of the Borough High Street Conservation Area, have a guide price of £2.25 million, but could fetch considerably more.
Southwark, which inherited the properties from the Greater London Council in the 1980s, said it would spend the proceeds from the buildings’ sale on constructing new council homes in the borough.
The Grade II-listed structures date back to the 1820s and are thought to have originally been homes for the managers of the Anchor Brewery, which was located nearby. Most recently, they formed part of Southwark’s housing stock, until they became vacant.
According to the council, the site the potential to be restored and redeveloped as “two or more exceptional houses”, as well as for uses other than housing.
However it cautioned that proposals would need to be sensitive to the buildings' architectural and historic interest and would be scrutinised carefully as part of any planning and listed building consent that was needed.
Regeneration lead Councillor Fiona Colley said costs of repair and refurbishment meant that selling the buildings was the best option.
“The receipt will contribute to our new 11,000 council house building programme,” she said.
Chris Coleman-Smith, head of auctions at Savills, said he believed the properties would be the most expensive council homes ever sold.
"We’re delighted that the proceeds of sale will contribute to creating more housing in the borough,” he said.
The auction takes place at the Marriott Hotel, Grosvenor Square, on 28 October.
Southwark Council has bought Courage Yard on Shad Thames, near Tower Bridge, which it will redevelop to generate income for frontline services.