The former Dwyers site in Corrimal Street has been sold, but the name of the buyer and plans for the block are shrouded in secrecy.
The agent responsible for the deal, Wollongong Colliers International managing director Simon Kersten, said the sale represented the "beginning of the recovery" for Wollongong's formerly sluggish commercial property market.
The unnamed buyer bought the property on Wednesday and is believed to have paid more than $10 million.
Mr Kersten said interest in the site had been strong and had included Chinese investors.
But he said Wollongong buyers were also among those interested in the property, signalling strong confidence in the commercial property market.
"It's surprising how many locals have the capacity for a site of that size," Mr Kersten said.
He said this was particularly true given several recent high-profile sales in the Wollongong central business district.
In June, the master plan for the Bass and Flinders Gateway development on the former Quattro site was revealed, and earlier this month a $40.5 million, nine-storey development was announced for Gipps and Flinders streets.
It also follows the announcement of a $38 million plan to turn the former Oxford Tavern site into a 14-storey, two-tower complex of apartments, shops and businesses.
"For those sales to have all happened and for there still to be market demand to absorb a site like this, it shows there's real strength," Mr Kersten said.
The Dwyers site and the Oxford Tavern once formed Wollongong City Plaza's $160 million Gravity development that was to straddle Corrimal Street.
The proposal was scrapped in 2008 after the parent company, Belmorgan, went into receivership.
Mr Kersten said at present, the type of development that made the most commercial sense was residential apartments.
"The end price ... you can sell them for is higher than commercial and the demand for residential is stronger than the demand for commercial."
The buyer has chosen to remain anonymous, however Mr Kersten confirmed they were among the first of several parties to show interest in the site when it came on the market in May.
The block, bounded by Crown and Burelli streets, is being used as a temporary car park by Wollongong City Council.