The two sites, with a combined area of 4700 square metres, sit between the ocean and The Esplanade and connect the upper and lower promenades on either side of the Scarborough Clock Tower and Amphitheatre. They have been covered in mulch since 2018.
The northern site will become public space for sport, recreation and events. The southern site will be subject to a commercial expressions of interest process for a family-friendly hospitality destination that steers away from bar-focused options.
City of Stirling Mayor Mark Irwin said the ideal development would be one or two storeys high and target family-friendly experiences.
"Like a lot of people around Scarborough, I can't wait for the woodchips to be gone, so it's great to see some movement on this," Irwin said.
The mayor described the projects as the missing pieces of the area's $100 million redevelopment about a decade ago.
"Almost 5000 square meters of land that is developable and ready to make Scarborough dynamic and realise that vision that was once intended," he told media on Tuesday.