The Candy brothers, the developers behind London's One Hyde Park flats for the super-rich, have turned their attentions to the City after swooping to buy the Sugar Quay site from administrators.
The Candys' CPC Group has exchanged contracts for the site on the north bank of the Thames, in its first purchase of a development asset since spending £959m on Chelsea Barracks with backing from Qatari Diar in January 2008.
The site, which houses a 110,000 sq ft office building and has planning consent for another of up to 231,000 sq ft is vacant and is leased to Tate & Lyle.
The firm is understood to be reviewing the possibilities for the "unique" site,with options including an upgrade of the existing offices, a commercial redevelopment or residential.
But obtaining planning permission for flats from the City of London Corporation will be difficult as it does not encourage new homes except in areas of existing residential development. CPC would also have to renegotiate its 80-year lease on the site with the Fishmongers' Company, the livery company which owns the freehold.