It was launched in 2010 by Tamil Nadu Urban Habitat Development Board (TNUDB) formerly known as the Tamil Nadu Slum Clearance Board, at Puthu Nagar.
Residents said it housed a police station between 2010 and 2019 and when the station was shifted to a dedicated building in 2019, the hall was shut.
Houses will not be demolished until the entire settlement is relocated, and private packers and movers have been engaged to help residents move for the first time in the city.
They will receive a sustenance package of Rs 24,000 to find interim accommodation, according to senior Urban Habitat Board officials.
Tamil Nadu Urban Habitat Development Board (TNUDB), formerly Tamil Nadu Slum Clearance Board (TNSCB), built the units in 2016.