A paddling pool in Woolwich... by the Diana team

The design team behind the Diana Memorial fountain has been hired to transform two squares in Woolwich town centre - and add a large, shallow water feature for paddling.

Landscape architects Gustafson Porter beat almost 40 firms from around the world to win the contract to renovate Beresford and General Gordon Squares.

Greenwich council is overseeing the project, which will begin next autumn and is due to be completed by 2011.

The Diana fountain in Hyde Park opened four years ago only to be hit by a series of problems. Several visitors who attempted to wade in the circular water-filled design slipped and injured themselves, and two required hospital treatment. Paddling was subsequently banned.

A spokesman for Gustafson Porter said a paddling area was at the heart of the design for General Gordon Square. "The water feature, consisting of a light scrim or film of water, can be drained quickly to enable other events to take place," the spokesman added. "The stepped and terraced amphitheatre in Gordon Square will also create a new public performance space for the town." The designs will include space for weekly farmers' markets, other stalls, alfresco café tables, public art and a visitor centre.

Pete Brooks, Greenwich cabinet member for regeneration, said: "Both squares are enshrined within the history of the town centre and the role Woolwich has played in the wider history of the country.

"The transformation is about preserving and improving these local landmarks." Funding for the project is from the London Development Agency, the Department for Communities and Transport for London. A spokeswoman for Greenwich council said £600,000 had already been invested. She would not say how much the final budget would be.

She added: "This investment is part of a much larger investment to regenerate Woolwich and reposition it as a strategic town centre in south-east London."