Blackstone Real Estate Partners is selling its Gold Fields House at Circular Quay for around $415 million.
The company on Monday said it had entered into a binding agreement to sell 1 Alfred Street property to Dalian Wanda Group.
Blackstone took ownership of Gold Fields House when it acquired Valad property group in a private transaction in 2011. It was its first major real estate investment in Australia.
Planning approval allows for the 1960s office building, that enjoys a prime location overlooking Sydney Harbour Bridge and the Sydney Opera House, to be developed for residential use.
Wanda Group says it "intends to create a mixed-use development including a 5-star hotel, luxury residential and retail".
The transaction is expected to close in March 2015.