Updated September 11, 2017 13:05:17

Photo: The facade of Hensley Hall has been mostly demolished to allow construction of an apartment block. (ABC News: Fletcher Yeung)

A Singapore-based developer has been accused of giving Sydney a "two-fingered salute" by demolishing much of the historic facade of an inner-city building in order to construct an apartment block.

The $21 million project will see three amalgamated 1912 Edwardian terraces in Potts Point replaced by a modern eight-storey tower.

The City of Sydney approved the demolition of the existing Hensley Hall building, with the exception of the Bayswater Road facade.

Photo: Locals say the remaining gables resemble two fingers sticking up, much like an insulting gesture. (ABC News: Fletcher Yeung)

But the recent removal of hoardings shows most of the facade had been removed, leaving two thin gables rising up on each end of the 25-metre frontage.

The City of Sydney has reportedly launched an urgent investigation into the alleged unapproved removal of the facade.

Potts Point and Kings Cross Heritage and Residents Society president Andrew Woodhouse said he believed the facade was demolished about 18 months ago, however it was hidden behind hoarding.

"We had assumed that what was happening was in accordance with the development consent," he said.

Photo: The heritage facade can be clearly seen in this artists impression of the apartment complex from last year. (Supplied)

He said he and other local residents discovered that the heritage facade had been largely demolished when the hording was taken down about 10 days ago.

He said workers began putting back up the hoarding over the weekend.

"There is now two gables left facing Bayswater Road and they appear to be two fingers sticking up, and that's symbolic of the developer giving the two-finger salute to the community over our heritage," he said.

The 930 square metre site is not a heritage item but is a contributory item within the Potts Point Conservation Area.

Over the years it operated as a private hotel and boarding house. Well-known local busker and collector Barry Minhinnick was evicted after 20 years living in the building and acting as its caretaker.

The garden he created out of found objects on the corner of Ward Avenue and Bayswater Road featured in newspapers, magazines and on ABC TV's Gardening Australia.

Photo: Barry Minhinnick lived in Hensley Hall for 20 years.

Mr Woodhouse has written to the council claiming the demolition was "wilful, negligent and/or deliberate".

He has asked the council to fine the developer or commence legal action as well as ordering the facade be reinstated at the developer's expense.

The City of Sydney and the developer, Roxy-Pacific, have been contacted for comment.

Topics: building-and-construction, local-government, potts-point-2011, nsw

First posted September 11, 2017 11:54:11