Mr Gurner and the Smorgon's Escor investment group will convert a building that currently houses their respective offices on the corner of Williams Road and Robinson Street in Prahran into an $85 million complex with 23 apartments.

The apartments will rise to six storeys with generous setbacks.

The new building is targeted at the rapidly evolving owner-occupier market, offering three- and four-bedroom apartments at an average price of $3.5 million.

"There's a very big push for owner-occupier buildings now," Mr Gurner said.

Few apartments were exclusively owner occupied, something that had developed a cachet with buyers, he said. "We will keep it as a fully owner-occupied building. People now don't want to be sharing," he said.

Mr Gurner said the site had gained a permit for more than 60 apartments which, if built, would have sold out within weeks.

But recent sales at the group's Albert Place project near the Shrine of Remembrance showed there was strong demand for larger apartments, with many buying two units to combine them, he said.

Albert Place went to market with 180 apartments but would be built with only 138.

"That's pretty unprecedented," he said.

The finished Prahran building, Hawksburn Place Residences, will also contain 800 square metres of office space which Mr Gurner and Escor will occupy for their businesses.

The Smorgon investment vehicle Escor, run by Norman Smorgon, has had an office on the site for 15 years. Mr Gurner has been based there for close to five years.

The luxury apartments will have a full-time concierge, a wine bar run by Toorak Cellars, electric car charge points for every park space and a basement car and dog wash room.

The building will also include a room on the ground floor with refrigerated lockers and other storage space for residents who order goods over the internet.

"Online shopping is particularly hard to do in an apartment," he said.