Work on clearing the land, which has been lying derelict for years, has been completed ahead of schedule.
In 2002, Selfridges bought the Argyle Street site which had previously been occupied for many years by Goldbergs and latterly Weisfelds.
But the company's plans to build a new store have been put on hold and the area had become overgrown and rundown.
Selfridges has in the past received two offers for the large site, which is bounded by Trongate, Wilson Street, Brunswick Street and Candleriggs, but refused to sell.
Following discussions with the city council it has now agreed the first phase of redevelopment work will result in the area being transformed into an event space.
It is possible it will be the base for pop-up shops and other attractions before and during the Commonwealth Games next year.
It is understood the second phase of work will result in a commercial, leisure and residential development being built.
A city council spokesman said: "The council is in discussion with Selfridges and its agents about both the short-term use of the space and the long-term development plans."
Local shopkeepers have complained for more than a decade that the boarded up site impacts on the number of visitors to the area.
In 2010, the company applied for permission to turn the land into a car park.
City council leader Gordon Matheson said: "I am delighted by the news the buildings at this site are now demolished, exactly as planned.
"We can now look forward to the development of one of the very few remaining vacant spaces in the Merchant City, one of the city's greatest success stories over the past 15 years.
"The council will work together with all partners with a stake in the site which has tremendous potential."
The high-end department store, has its flagship Selfridges on Oxford Street.
It opened in 1909 and is the second largest shop in the UK after Harrods.