A ''FRENZY'' of apartment towers granted planning permission in one corner of Melbourne's CBD could squeeze thousands of new residents into four city blocks and change the character of the city.

The proposed concentration of developments - many of which include tiny one-bedroom apartments - could see Melbourne follow the lead of Asian cities such as Hong Kong for extreme density, according to a prominent planning academic.

Associate professor in environment and planning at RMIT, Michael Buxton, said: ''It's changing the character of the CBD that people love irrevocably and it's wrecking historic value.'' And property experts fear a glut of apartments could affect property values and rents.

Records from the Department of Planning show 7800 new apartments are proposed for a pocket to the city's west, bounded by La Trobe, William, Bourke and Spencer streets. The area is a microcosm of a citywide trend that began when the residential property market rebounded in 2010, on the back of strong population growth and government stimulus.