The successful bidder to build the Melbourne Metro rail tunnel will be given development rights at two prime CBD sites above underground stations, on the condition the new buildings have architectural merit.

The prize sites earmarked for development include the scruffy, heavily trafficked row of shops along Swanston Street between the Young and Jackson Hotel and the Nicholas Building.

The site is home to a McDonald's, a souvenir store, a Hungry Jacks, a Commonwealth Bank branch and the Port Phillip Arcade, all of which will make way for a new station.

The north-west corner of Swanston and Latrobe streets, opposite RMIT University, is also up for redevelopment, in a deal designed to help pay for the Melbourne Metro project.