A prime Barton site, which is a known habitat for the critically endangered golden sun moth, is set to be transformed into a large-scale office block after being snapped up by a prominent local developer.
Doma Group, together with property firm Goodwin and Kenyon Group, have paid the federal Department of Finance an undisclosed amount to secure the vacant National Circuit block, which was put up for sale earlier this year.
The Australian Financial Review on Tuesday reported the site was understood to have sold for $38 million, but neither the department, the developers or the real estate agent managing the sale would confirm that figure, citing commercial confidentiality.
Doma's general manager of development, Gavin Edgar, said it planned to redevelop the site into a 40,000 square metre office block for Commonwealth and private sector tenants.
Mr Edgar said it would also consider building a hotel on the 11,560 square metre site, depending on market demand.
Construction work was expected to start in early 2020, subject to planning approvals, he said.
The vacant block is zoned for residential and commercial uses.
The sale consolidates Doma's strangehold over the precinct. It has approval for a six-storey, $75 million office block next to its Little National Hotel, which sits adjacent to the recently-purchased site.
The Jure Domazet-led company also operates the nearby Realm Hotel and Burbury Hotel.
Goodwin and Kenyon Group principal David Kenyon said the site's redevelopment would "enhance the position of Barton as Canberra's most prestigious precinct".
The prime slice of inner-south real estate has remained vacant and undeveloped because it is home to a population of critically endangered sun moth. The land also includes natural temperate grassland, which is recognised as a threatened ecological community.
In 2017, the department applied to the National Capital Authority to rezone the site before it was put on the market.
The department's acknowledgement that work to clear the site for redevelopment would result in the loss of sun moth habitat sparked a backlash from local environmental and residents' groups.
In its submission to the federal environment department, Friends of Grasslands group said the proposal would "totally destroy the site".
The rezoning was approved in December 2017, before environmental approvals were ticked off in February.
As a condition of the approval, the department will be required to compensate for the loss of moth habitat in Barton by maintaining habitats at a Commonwealth-owned site in Hall.
The Barton site is one of a number of known golden sun moth habitats in line for redevelopment.
The ACT government's planned redevelopment around City Hill will require the removal of 1.46 hectares of habitat. About 2.6 hectares will be razed as part of work to construct a new access road to the Yarralumla brickworks, where Doma is planning to build 380 homes.
Kingston and Barton Residents' Association president Rebecca Scouller said clearing the Barton site was a "loss for Canberra's environment and our credibility as a progressive city".
Ms Scouller was critical of the original environmental approvals, saying it had sacrificed "long-term natural assets for short term financial gain".