The eight-year battle between the city of Hoboken and a developer over a coveted piece of land on the waterfront uptown is apparently over after the two agreed to a land swap.

Hoboken Mayor Ravi Bhalla announced Monday that the settlement with Applied Development Company would create open space on the Monarch project site, a property east of the Tea Building at 15th Street. Applied had planned to build two 11-story towers on the site.

In exchange, the developer would be given the city’s Department of Public Works property at 256 Observer Highway in an agreement that must be approved by the City Council. The agreement culminated a year of back-and-forth negotiations. The city would still own the DPW garage.

“This settlement is a win for the city of Hoboken,” Bhalla in a news release. “Not only does it protect our precious waterfront from development and preserve the site for open space, but it also presents an opportunity to revitalize an area in downtown Hoboken."

Officials with Applied declined to comment.

Under the settlement agreement, the city and Applied would have up to a year to negotiate and finalize the terms of a redevelopment agreement, Hoboken spokesman Vijay Chaudhuri said.

The agreement calls for the DPW to remain at 256 Observer Highway, in “a state of the art facility ... paid for and built by Applied Development Company,” city officials said.

Applied would build its housing — 264,000 square feet, with at least 11 percent of the units affordable housing — above the DPW facility, under the tentative terms. Also, there would be 4,000 square feet of retail. Officials said the development would be in scale with the neighboring buildings.

“A new, state-of-the-art municipal garage will facilitate improved public works services,” Bhalla said. "While we have work to do over the next several months to finalize this proposed deal with a redevelopment agreement, this settlement is a critical step forward.”

Chaudhuri said the mayor has not finalized any plans for the open space on the waterfront.

Hoboken Councilman DeFusco said the project will reduce noise in the neighborhood, provide investments in downtown infrastructure and bring new retail space to Observer Highway that may allow small businesses to invest in Hoboken.

The financials and the blueprint of the building will be negotiated after the settlement is approved by the City Council, Chaudhuri said.

DeFusco said in a press release that if an agreement is reached, he would advocate for the developer to include a public arts space within the new complex along Observer Highway.

“The city’s new tentative agreement with the Monarch developer is an opportunity to activate a grossly neglected neighborhood in the First Ward, make critical infrastructure investments without any cost to taxpayers and bring new public arts programs to our city," said DeFusco, who represents the First Ward on the council.

“Hoboken has already spent years entrenched in legal battles with the Monarch developer, accomplishing little more than accumulating costly legal bills," he said. “I believe relocating this project can put an end to an issue that has plagued our city for nearly a decade.”

The discord over the site began in 2011, when city officials say Shipyard Associates completed the Shipyard project and reneged on a 1997 agreement to preserve the last portion of this site, about 1.4 acres of land and pier, as open space that included a portion of the state-mandated Hudson River Waterfront Walkway.

Instead, the developer, proposed the Monarch project, and the two sides have been entrenched in multiple legal proceedings that landed at the doorstep of the state Supreme Court.