Historic Melbourne Supreme Court asset offered for sale
The Victorian government is offloading a former Supreme Court building in the heart of Melbourne’s legal precinct. The rare sale includes eight courtrooms once used for commercial and common-law matters.
The nine-storey building at 436 Lonsdale Street was built between 1924 and 1931 and will need extensive renovations to bring it up to today’s standards. The revamp bill will be between $25 and $30 million, says Tim Grant, Savills state director, commercial sales Victoria.
While the new buyer can reimagine the site, it cannot alter the sandstone facade.
“It’s a building that needs a bit of love internally from a buyer, but in this market it’s almost the perfect building for someone to buy, spend some money on, reposition and tip back into the market, whether it’s for lease or whether it’s an owner-occupier that potentially buys it,” he says.
Structural history anchors prime value-add opportunity
The property was built between 1924 and 1931 as a tax office. The Supreme Court leased six floors, including mediation rooms, registries, chambers and administrative space, from the mid-1990s. A Supreme Court of Victoria spokesperson said the ground floor was remodelled in the 1990s to create courtrooms.
The court vacated the property in 2021, and the building has remained empty since. It has never been sold before.
Since the listing went live, Grant said he and his colleague, Tom O’Halloran, have shown 15 groups through the historic site.
“We’ve taken people through that are high-net-worth privates looking at refurbishing the building,” he says.
“The buyer could be anyone from syndicators or the bigger groups, whether it’s a Dexus, Charter Hall or any of those groups.”
Selling a former court building is a new experience for the Savills team.
“It’s pretty rare, pretty unique and it’s obviously got a rich history,” Grant says. “Every time you go through, you find a little new room or area there. So it’s a pretty daunting building.”
Development permit offers commercial scale upside
The building has 8305 square metres of net lettable area and is positioned on a corner landholding of 1490 square metres. It comes with an existing permit for a 23-level office tower with a gross floor area of 22,755 square metres.
Melbourne’s office vacancy rate currently sits at 19 per cent – well above the national rate of 15.9 per cent. However, the rate is expected to slip, with high construction costs limiting the number of new office buildings coming into the market.
“We do see the leasing market continuing to tighten because there will be no new supplies coming onto the market by way of brand-new buildings, although there will be some refurbishment stock like this,” Grant says.
The Supreme Court shifted its commercial and common law hearings just around the corner to the William Cooper Justice Centre at 233 William Street in 2021.
The William Cooper Justice Centre, named after the late Aboriginal community leader and Indigenous rights campaigner, is also home to the Victorian Civil and Administrative Tribunal.
Expressions of interest for the sale close at 4pm on July 16.
