The London Borough of Hammersmith and Fulham started the process for the CPO, which would involve the market and surrounding properties including a parade of shops on Goldhawk Road, following the granting of outline planning permission in 2012.
The regeneration plans, submitted by developer Orion Shepherd’s Bush, include new look market stalls and 200 new homes. A High Court judge dismissed a legal challenge against the approval in October last year.
According to a decision letter, planning inspector Ava Wood had recommended that the order should not be confirmed because the "guarantees and safeguards are not sufficiently robust to be assured that genuine opportunities exist for current traders and/or shopkeepers" and there is therefore a "real risk" that the new market and shops "will not provide the ethnic diversity, independent or small scale retailing environment that is central to the appeal of the area".
But the secretary of state disagreed with the inspector, concluding that the benefits for the area outweigh the objections to the scheme.
"The secretary of state considers that the proposed purpose of the order, including the redevelopment and regeneration of the area, will significantly contribute to the achievement of the promotion or improvement of the economic, social and environmental wellbeing of the area," the decision letter said.
Planning minister Brandon Lewis said the scheme has the potential to bring "substantial" benefits.
"This market is held in great affection by the local community," he said. "Regeneration will enable it to continue to provide a diverse range of stalls to meet their needs as well as improving the appeal for new visitors and shoppers alike."