Matthew Guy (right) with developer Michael Yates in 2012 at the opening of an earlier apartment project in South Yarra. Credit:Bird de la Couer architects Mr Yates donated $25,000 to the Victorian Liberal Party in the financial year ending in 2012 – soon after he says he started negotiating to buy the land. Mr Guy's justification for calling in the proposed towers at 661 Chapel Street was a gifted kids centre for prestigious Melbourne High School that was to be built as part of the project. The centre remains unbuilt. The Chapel Street site had a preferred height limit of 13 storeys. Mr Guy approved 31 levels.

Melbourne High School (foreground) and the development at 661 Chapel Street, South Yarra, behind it. Credit:Daniel Pockett Stonnington Council was vehemently opposed to the towers, which council officers said was "an unnecessary overdevelopment of the site". The late Adrian Stubbs, Stonnington's mayor when Mr Guy approved the towers, said the decision was ill-advised and made "behind closed doors". An artist's impression of Gamuda's 661 Chapel Street project, and Melbourne High School to the left. Credit:Gamuda Land Malaysian developers Gamuda​ and the Chinese C&L International Holdings have almost finished their towers behind the 90-year-old selective entry boys high school.

Property records show Gamuda paid $40 million for their section of the site in 2014, while C&L paid $16 million for their portion the same year. The owners of the two towers have since been spruiking their apartments to buyers in Malaysia, Hong Kong, Sri Lanka, Germany, Indonesia, Vietnam and China. In Kuala Lumpur last June, Gamuda staged an "exclusive sales event" for potential investors who wanted "property on Melbourne's most desirable street". Mr Yates said he had started putting together the land deal in 2011, and made his $25,000 donation soon after.

Questioned about his donation and the subsequent Chapel Street approval, Mr Yates said: "I've been a donor for 40 years. I know exactly what you are suggesting but I have been giving on and off for 40 years." Asked if he was pleased to have made a sizeable profit from the land sale, Mr Yates agreed he had done well. But he said the process had not been easy. "There were probably $2 million or $3 million of costs [on planning and legal expenses] and it took three or four years of work to get it done," Mr Yates said. Mr Guy is now Opposition Leader and last week came under extreme pressure after Fairfax Media revealed he had a secret dinner earlier this year with the alleged head of Melbourne's Mafia at a lobster restaurant in Melbourne's south-east. The South Yarra approval from Mr Guy came after a 2012 application from Mr Yates' company to Stonnington Council was rejected.

Mr Guy called in the application and gave it the green light before it could be heard in the Victorian Civil and Administrative Tribunal, where it was headed after Stonnington's rejection. A portion of the land was sold to the Melbourne High School Foundation for the high school's academy, but no construction has commenced. Melbourne High School principal Jeremy Ludowyke​ said both the Coalition and Labor had committed to building the academy. And he said the towers that were almost complete at 661 Chapel Street had done no harm to Melbourne High School. "It has no impact on the amenity of the school – it does not overshadow the school," Education Minister James Merlino said there had been money provided for a feasibility study into the proposed Gifted Academy at the Chapel Street site. He said the government would decide whether to proceed when the study was complete.

Coalition planning spokesman David Davis said the project had been recommended by the then education minister and his department, the planning department, and Melbourne High School and its foundation. "This is a bipartisan project which the former Coalition government promised funding for but is now the responsibility of the Andrews government, who made a funding allocation in the 2016-17 state budget," Mr Davis said.