Negotiation has cleared the way for an aged care facility to be built in South Melbourne.

Claremont and South Port Aged Care (CaSPA Care) are delighted that compromises from all parties has enabled the facility to go ahead.

Objections were lodged against the original proposal that had been approved by Port Philip Council.

Residents group Too Big for South Melbourne launched an appeal with the Victorian Civil and Administrative about the 146-bed home to be built behind the former St Vincent's Boys Home on Cecil Street.

102 objections were raised including concerns about the size of the building, overshadowing and loss of light.

A spokesman for the residents’ group said that confrontation could have been avoided had “the developer and the town planner had undertaken some consultation before the plans were submitted to council."

CaSPA Care chief executive Stephanie Clark said "The board of CaSPA and myself are very grateful for the goodwill shown throughout our negotiations with our neighbours."."