The highest skyscraper outside Melbourne's city centre has been approved, with the state planning tribunal giving the go ahead to the 50-storey Capitol Grand development at the corner of Chapel Street and Toorak Road.

The tower gained notoriety when developer Larry Kestelman paid $3 million to Oscar-winning actor Charlize Theron, who flew into Melbourne for 48 hours to promote the project at this year's Grand Prix.

Charlize Theron jetted into Melbourne to promote the Capitol Grand - at a cost of $3 million. Credit:Chris Hopkins

The site was once home to the Fun Factory, an amusement centre, and before that the Capitol Bakery. The facade of the old bakery will not be retained as part of the development.