Plans by the Department of Transport to turn disused railway arches below the former Waterloo Eurostar terminal into shops and restaurants have been approved by Lambeth Council.

London & Continental Railways (LCR) – which manages the former Waterloo International Terminal on behalf of the Department for Transport – applied to Lambeth Council for permission to turn some of the arches below the rail viaduct into eight new shops and restaurants.

Since 2008 Leake Street – which runs between Lower Marsh and York Road – has been a centre for graffiti artists.

LCR claims that its restaurant scheme will "protect and maintain this unique hub for creativity and street culture".

The scheme includes a new pedestrian link between Addington Street and Leake Street in the space where a car wash is currently situated.

The proposals, designed by architects Corstorphine + Wright, won unanimous backing from Lambeth's planning applications committee last week.

"The Leake Street Arches present an excellent opportunity to build on Waterloo's existing cultural offer and enhance the urban environment around the station," said LCR's Adrian Lee.

"We will use our expertise in developing land around railway assets to deliver a new, vibrant restaurant and bar destination at Leake Street which pays homage to the area's creative heritage."

Information from this summer's public consultation on the scheme is still available to read at www.leakestreetarches.london