In the golden age of neon advertising, few Sydney signs shone as memorably as the animated golfer on Sharpie’s Golf House.

From about 1964 until it flickered into disrepair decades later, passers-by watched the neon golfer hit a perfect hole-in-one. Every single shot.

Neon’s popularity faded, replaced by LED technology. In 2007, the sign was removed and in 2013 it was donated to the Powerhouse Museum, deemed too costly and difficult to repair.

Now, the derelict building is set to be demolished to make way for luxury apartments in a development by Trinvass Pty Ltd with PTI Architects and interiors by fashion designer Collette Dinnigan.

Golf House will feature 45 residences on seven floors, plus ground-floor retail space, a rooftop terrace and underground car park.

PTI Architects principal Peter Israel said the vision was to create a character-filled building using materials such as brick, copper and timber to reflect the area’s industrial past.

“The copper detailing on the facade will have a strong, bold presence but it’s the layout and flow of the residences that capture the natural light and the city views that create the joy we want this building to provide,” Israel said.

There are also plans for a piece of public art celebrating the old neon sign.

Since stepping back from her fashion label in 2013, Dinnigan has collaborated on the interiors for several deluxe properties, including Bannisters by the Sea at Mollymook and Milton Surf & Stables.

Golf House is the latest in a string of high-end developments transforming a gritty pocket of Surry Hills better known for backpacker hostels and bill posters into one of the city’s hottest addresses.

Last August, all 38 apartments in Cornerstone Property Group’s iconic Griffiths Teas building on Wentworth Avenue sold at the launch. Another reimagined factory site by Cornerstone, No.1 Lacey, also sold out quickly last July.

Nearby at the former Legion Cabs service station site, 44 of 53 apartments in The Foveaux sold at the September 2014 launch.

Ged Rockliff, head of residential projects at Savills, which is marketing Golf House, said this part of Surry Hills was the closest Sydney had to New York’s Greenwich Village or Tribeca.

“You’ve got all this character that can’t be replicated because of the industry that occurred there for decades,” Rockliff said.

Tony Cohen has owned The Illustrated Man tattoo parlour near the Golf House site since 1988. He said he was looking forward to the development – and even expected a few new customers.

“It depends who buys. If it’s 80-year-old millionaires, I don’t think I will, but if it’s a new generation, the under 50s, I’m sure we’ll get a few customers. Putting all this flash stuff up next to us is going to be a hell of a boost to the area, I reckon.”

The on-site sales suite for Golf House is due to open late May.