The Astoria Theatre, the famous music venue on Charing Cross Road in London, is soon to be demolished to make way for the capital's £16bn Crossrail scheme.

Along with 12 other nearby sites, the 2,000-capacity venue – which has played host to artists including The Rolling Stones, Madonna, U2 and Pearl Jam – was issued with a compulsory purchase order to accommodate an extension to Tottenham Court Road station.

A campaign to save the venue – which also hosted the popular G-A-Y club night – attracted more than 35,000 supporters, but former mayor Ken Livingstone announced in March this year that the venue could not be saved. Livingstone did say that a new mid-sized venue would be built as part of the development, however no further details have been provided.

The Crossrail project aims to link Maidenhead in Berkshire to Shenfield in Essex, and Tottenham Court Road will be a major station on the line. The scheme is being developed by Cross London Rail Links, which expects to have possession of the properties by January next year.

Preliminary works are expected to begin next year, with main construction starting in 2010. The project is expected to open for service in 2017.

Rail minister Lord Adonis said: "This is a major step forward in the delivery of the Crossrail and underlines the government's commitment to the project."

Developer Derwent Valley bought the Astoria in June 2006 for £23.75m, which was then leased to Festival Republic, the live music promoter formerly known as Mean Fiddler. Derwent Valley was originally rumoured to convert the site – and adjacent buildings that it had already acquired – into a mixed-use retail and office development.

The Astoria was built in 1927 as a cinema and started holding theatre productions in 1976 – ironically just as theatres all over the country were being converted into cinemas – before becoming a live music venue.