More than 500 students will live in new student accommodation which, in a marked departure from the original plans, will increase in size from six to 16 storeys at the building's highest point.

The revised concept plans for the Pemulwuy Project, the name of the $70 million dollar development of The Block, almost quadruples the provision of student accommodation from the original 152 student places initially proposed.

AHC chairperson Alisi Tutuila said the changes were necessary to ensure the other aspects of the development - namely the provision of 62 affordable homes for indigenous people - could be built without having to rely on further government funding or grants.

"This new model will allow the the Pemulwuy Project to remain financially independent and self-determined and the AHC will remain sole legal owners of the land and site custodians," she said.

"We won't be leaving a legacy of debt for our future generations, which is extremely important to us."

It aims to achieve this by capitalising on the demand for student accommodation, particularly for international students, close to the University of Sydney.

But she rejected the suggestion that the new plans constituted a trade-off between the project's financial viability and the area's Aboriginal identity, saying the Pemulwuy project had received wide support from the Aboriginal community.

"Our core business is to provide affordable housing for Aboriginal and Torres Strait Islander people," Ms Tutuila said.

"This model is a win win for everyone."

With 522 student rooms spread across 16 storeys and 17,000 square metres, the new accommodation facility will further consolidate the rapidly changing demographics of The Block, which has become a popular area for young professionals and creatives in recent years.

It will be built directly opposite the north end of Redfern Station, in between Lawson Street and Redfern Street.

The student accommodation is one of three precincts comprising the Pemulwuy Project, and the only aspect which has been altered under the latest concept plans.

Lodged late last year, the new plans will enable the two other precincts, which include the affordable housing component as well as commercial and retail space, including a fitness centre and childcare centre, to be built at the same time.

Under AHC's original plans, which were given the green light in 2012, the affordable housing was earmarked for a later stage, and had yet to secure funding.

The proposed changes means the project must again proceed through the early stage of the development process, and will require community consultation before it is assessed by the Department of Planning.

However, the City of Sydney has already raised concerns, namely that the new building proposes a "significant departure" from the height and floor space standards for the site.

Responding to the Department of Planning's request for feedback, the council's area planning manager Christopher Corradi said the new facility must demonstrate "a higher or equal level of internal amenity for the future occupants" to account for the large increase in residents.

The Block, often recognised by the Aboriginal flag mural of the rising sun at its northernmost end, has been slated for redevelopment by the AHC for nearly three decades. However, plans have been repeatedly delayed by setbacks and modifications, and mired in controversy.

For more than a year an Aboriginal tent embassy occupied the grassy block beneath the mural, protesting the gentrification of the area and the erosion of its indigenous links.

The protesters accused the AHC of prioritising the project's commercial aspects over the promise to build homes for indigenous families.

Led by elder Jenny Munro, the embassy decamped from the site in August 2015, after Minister for Indigenous Affairs Nigel Scullion brokered a peace deal between the activists and AHC, amid court action to remove the protesters. As a result, the federal government committed $5 million to the project's Aboriginal housing component.

A wire fence has since been erected around the site with signs warning trespassers to keep away.