Angela Rayner threatened to block the controversial Bury House tower block application this week, which was due to go before local planners next month for a decision.
The Ministry of Housing, Communities and Local Government said it has restricted the granting of permission by the corporation, to allow the government to consider the case.
Developer Bentall Green Oak has faced strong criticism over its 31 Bury Street project and lowered the height of original plans by five storeys over concerns the tower would impact natural light levels in the Synagogue, founded in 1701 and impact on the character of the area.
Multiplex is providing construction advice on the scheme, which has been designed by architect Stiff & Trevillion.
