Which is what makes a recent application for a 17-level tower on a strip of land between the genteel suburbs of North Fitzroy and Clifton Hill worth noting.

The former light industrial and commercial area on Queens Parade in Fitzroy North is wedged between Hoddle Street and busy Heidelberg Road, and is next to a major tram and bus interchange, as well as the Hurstbridge and South Morang train lines.

Its mixed-use zoning is designed to encourage medium and high-density development.

The tower application was made to Yarra Council in May. It is the highest building applied for in the neighbourhood.

It follows applications earlier in the year for a 10-storey retirement home a few doors down, and an approved 11-storey apartment block next door.

The 17-level project would cost $30 million to build and be far higher than the predominantly one and two-level buildings in the area. The project is a joint venture by the Tarascio family's Salta Properties, and Wolf Capital, a smaller development company owned by the Wilson family and Penelope Callaghan. They bought the land for the project for $8.5 million between July and November last year.

The project would entail the demolition of single-storey brick warehouses and office buildings, and the construction of 129 apartments.

An artist's impression of the proposed tower on Queens Parade.

Several applications have come and gone for the strip in recent years, and it is now in play as a major building hub, as website Urban Melbourne reported recently. One large chunk of land in the strip is being marketed by Colliers.

Yarra councillor Stephen Jolly – who works in construction for a major building company, often on large residential projects – said 17 storeys was "not exactly the Eureka Tower, but in Clifton Hill it's going to stick out like Pinocchio's nose".

"I work on projects bigger than that every day, but if the state and local planning rules allow this in Clifton Hill, we may as well give the game away."

Cr Jolly said the strip was perfect for medium-scale and even high-rise development, suggesting "eight or nine levels" were suitable.

"But 17 is just taking the piss," he said. "Once you get 17 in a spot like this, the next developer wants 18 and so the merry-go-round continues. That's the experience we've had in Collingwood."

The president of local resident association The 3068 Group, Chris Goodman, also said the proposal was too high for the area.

"If you're going to put height anywhere, this part of Queens Parade can handle it better than anywhere in the suburb. Once you take on board all the parking and need for better pedestrianisation, though, it could overwhelm the area."

He questioned whether the area's streetscape – which is heavily focused on car and bus traffic – could support such intensive development.

But Danni Addison, the Victorian chief executive of the Urban Development Institute of Australia, said that delivering housing in central locations like Clifton Hill and North Fitzroy was critical because they were so well serviced by amenities and transport.

Projects in key areas needed to be facilitated "so that Melbourne's community has a wealth of housing options".

"For the sake of housing affordability, councils need to realise the significant role they play in unlocking housing potential in established, central suburbs such as Clifton Hill and North Fitzroy," she said.

And the project's joint developer, Salta Properties, also argued that the design, scale and density of the proposal fitted perfectly into the state's planning policies.

Salta managing director Sam Tarascio said the apartment project would allow prospective owner-occupiers and investors "access to premium residences on the city's fringe".

He too pointed out that the project had existing infrastructure, public transport services and community facilities on its doorstep that could "accommodate [the] scale of population growth" Melbourne was seeing.