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The deal, struck by Balmain Group on behalf of mortgagee Goldman Sachs, has not been confirmed, but market rumours within the property industry strongly indicate a contract has been signed.
The site, which once housed the famed Billy's Beach House, was acquired by Goldman Sachs in 2013 after it bought Suncorp's $1.6 billion distressed loan book for 60c in the dollar.
The site once housed the 16-level Iluka apartment tower, which was among the Gold Coast's first high rise buildings and a beachfront landmark for more than 40 years.
Iluka has since been demolished and the site grassed and fenced off. The demolition cleared the way for a sale of the property, however it was never been placed on the open market by Goldman Sachs.
Market observers are perplexed by the off-market deal in the wake of the Gold Coast high rise market gaining momentum and the potential to secure a higher price.
Iluka was one of the high-profile casualties of the collapse of Gold Coast developer Raptis Group (ASX: RPG) in 2008.
The property was earmarked by Raptis for a $700 million redevelopment in 2007 after being amalgamated for a total of $94.4 million.
In the aftermath of the 2008 property collapse, agents at the time said the ageing high rise - which was riddled with "concrete cancer" - would struggle to find a buyer at $25 million.
Balmain Group, which controls the Pacific Mortgage Fund through the Balmain Trilogy group, did not respond to requests by Gold Coast Business News for comment on the sale.
Balmain has secured a number of sales of distressed Gold Coast properties to the Chinese in recent years, including the Jewel multi-tower site to Ridong in 2009.
Ridong, which has been slow to proceed with its $900 million triple-tower hotel-apartment project, has since joint-ventured with one of China's biggest developer's, Wanda Group to bring it to fruition.
Wanda, headed by one of China's richest man, Wang Jianlin, has since established an Australian headquarters on the Gold Coast with plans to spend up to $1.7 billion in domestic property opportunities. Some observers have suggested Wanda could be the buyer of the Iluka site due to the Balmain link.
Meanwhile, demolition work has already started on Jewel, which is located on a 1.1ha beachfront site on Old Burleigh Road at the southern end of Surfers Paradise.
The six-star hotel and resort, which will primarily target inbound Chinese tourists, is scheduled to open in 2017.
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