The former Sandilands building, opposite the RSL, was demolished in 2014 and plans for a $20 million nine-storey apartment development once touted as the city's biggest ever residential development were unveiled in 2015.

But the site has sat untouched since the council approved the plans.

Midfield Meats' and owner Dean McKenna said there were still plans to develop the site at some stage.

"We're still kicking the can around on that, but it's not at the top of our priorities," Mr McKenna said.

"We've got that much going on.

"There's plenty of things on the table."

The council confirmed there was an active permit for the site, but work needed to start by 2023.

Plans include 27 residential apartments and 24 serviced apartments plus two retail spaces and two levels of car parking.

The project, which for many years was the Maddens Lawyers offices, would tower 28.6 metres above Gilles Street and 24 metres above Merri Street at its eastern extremity.

The site was well known as the location for the Sandilands guesthouse which sat on the corner of Gilles and Merri streets for more than 70 years - a landmark of builder Erny Harris and architect Demaine and Russell.

Although there was a recommendation that the building be retained as a significant piece of local heritage, the city council in 2009 voted to ignore a planning panel's recommendation and approved a demolition permit.

While the Merri Street project was once thought to be the largest ever residential development in Warrnambool, it would now be eclipsed by plans in Fairy Street for a $70 million nine-storey apartment and commercial building.

Plans for that development were revealed in June and includes three towers - one featuring 100 serviced apartments, another with up to 60 apartments and an office tower with retail space.

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