Planners at Sandwell Council have given the go-ahead to Bluestone Homes to demolish Regis Hall in Reddal Hill Road, Old Hill, and replace it with nine homes.
The banqueting suite was formerly a club and live music venue which saw top acts such as The Drifters perform there in the 1960s.
Developers said the use of the hall dwindled over the years and was put on the market for sale in 2019 for £500,000 but failed to sell at an auction.
In the application, Bluestone Homes said the houses will be a mixture of two and three-bedroom properties and would be aimed at families or professionals working from home.
Agents Steven J Dunn & Associates said: “These modest residential development proposals have been produced as a result of the need for proportionate housing growth in Sandwell to meet local demand for larger family type accommodation.
“The design of the units and materials proposed will be in keeping with those of the surrounding properties and local vernacular.
“The proposals have been developed carefully over time to ensure they are deliverable. There are no constraints to the development and the site is available and viable.
“The proposals will perform an economic role in generating direct employment during the construction phase as well as indirectly through the supply chain.
“New residents are likely to work within the borough, bringing valuable skills into the area.
“The proposals will perform a social role through the creation of starter and family accommodation where the new residents will contribute to community life.”