The former Drift in the City bar is to be demolished to make way for a new, vibrant and attractive public city centre space.
Plans for landscaping work, which retains the existing trees, and improves views of the war memorial and the entrance to Victoria Park, will be announced by Portsmouth City Council after stakeholders have been consulted.
Portsmouth City Council cabinet member for regeneration Cllr Ben Dowling said work would start on the demolition this month.
"This is a great opportunity to do something special with this space and to reconsider its role in the context of the wider city centre," Cllr Dowling added. "We're doing everything we can to make Portsmouth a better place to live and work and the quality of the public realm in the city centre is a really important part of what we're doing."
The removal of the building, in Isambard Brunel Road - which has been empty since February 2013, apart from six months of temporary occupation - is expected to be completed early next year.