Permit for 35 storeys lifts return to $3.1m

Melbourne City Council's stamp of planning approval has added more than $3.1million to the sale price of a development site on the northern edge of the CBD.

The owner, lawyer and private investor Konfir Kabo, has sold the La Trobe Street property for $8.5 million after buying it for $5.33 million (including stamp duty) less than three years ago.

The 59 per cent spike in value has come courtesy of the controversial decision to grant a permit for a 35-storey residential tower on the property.

Designed by Ellenberg Fraser, the complex will feature 243 apartments, 42 car spaces and a ground-floor restaurant and has an end value estimated at $100 million.

But the sale price is believed to be less than MrKabo was seeking, with the 5690-square-metre site at 36-40 La Trobe Street originally put to market with an asking price of $10 million to $12 million.

Agents in conjunction, Fitzroys and Colliers International declined to comment on the identity of the purchaser, who is believed to be an "active" Melbourne-based developer.

"There had been a huge level of offshore interest registered in the property, particularly from Chinese and Malaysian developers, however in the end a local developer was the successful buyer," said Fitzroys agent Charles Emmett.

Council planning officers had recommended the permit be denied because it represented an "overdevelopment" of the site but they were over-ruled in a council vote.