The Art Deco property at 420 Spencer Street, a former theatre in the 1930s, was expected to fetch more than $7 million for private investor Paul McBain, who bought it for just over $3 million six years ago.
Electrical retailer Nightingdale Electrics pays annual rent of just over $216,000 to lease the building at the corner of Spencer and Dudley Streets in West Melbourne.
When approached by Capital Gain, Colliers International selling agent Matthew Stagg said the property had been withdrawn from auction – but declined to elaborate further.
Local agency sources say issues relating to the permit, which was met with widespread opposition by locals, architects and the National Trust, may be behind the sudden withdrawal from sale. It is not believed to have sold prior to auction.
The property was being marketed as a development site with a permit for a 13-level, 40 metre Fender Katsalidis-designed residential apartment tower to be built behind its heritage facade.