Project Update

Council decided, at the 15 March Council Meeting, to award the lease of the South Melbourne Town Hall to the Australian National Academy of Music (ANAM).

The 35-year lease will begin after the music academy has contributed $20.5 million in capital investment to the building. The lease can be extended to 50 years if ANAM provides a further $19.5 million in capital investment.

Port Phillip Council Mayor Heather Cunsolo said the lease will secure the long-term future of what has been a much-loved landmark for 140 years.

What we heard

In December 2022 and January 2023, we asked for community feedback on a proposed long-term lease of South Melbourne Town Hall to Australian National Academy of Music. 554 people submitted their feedback on the proposal, with 91% (487 participants) supportive of the lease.

Those supportive of proceeding with a lease commonly mentioned:

  • increased activity/visitation/vibrancy
  • increased cultural value
  • the suitability of the proposed use/tenant
  • the preservation/restoration of a heritage building
  • a reduced cost burden to Council.

4% of respondents (21 participants) were not supportive of the proposal, mentioning the duration of the proposed lease was excessive, and the proposed use limited access by others. 5% of respondents were unsure if they supported the proposed lease.

The report with details of the community engagement findings was presented at a Council Meeting on Wed 1 March 2023. The engagement report is available to view online.


About the project

Though there remains a civic need for town halls and other large public gathering places, our communities have evolved
- and the practical need and expectations for such spaces have changed.

We know, however, that this remarkable building’s physical presence itself can contribute to a sense of civic pride and ownership due to its age, grandeur and what it may be seen to symbolise.

The Australian National Academy of Music (ANAM) has been the major tenant of the South Melbourne Town Hall since 1996, following an agreement reached by the City of Port Phillip and the Victorian Government. A range of other arts, cultural and community organisations have, until recent years, occupied other parts of the building.

We have now negotiated a lease to ANAM that we would like your feedback on. The lease is intended to:

  • secure ongoing use of the South Melbourne Town Hall as a cultural hub
  • support its restoration, renewal and ongoing maintenance; and
  • over time, boost use and visitation.

Under the proposal, the lease does not commence unless ANAM invests $20.5 million into the building, and the rent it is required to pay is linked to achieving specified performance targets - to support building safety and insurance, conservation and community access.

Council is seeking the community’s views on the proposed lease.

Council will consider the feedback prior to making a final decision on whether to proceed.

Principal terms

Here are the principal terms of the proposed lease.

  • Allowed uses

    • Artistic, creative & cultural training & performance
    • Gatherings
    • Events & functions
    • Office
    • Ancillary uses

  • Rent

    Commencing rent is $550,000 annually.

    It reduces if performance targets are met.

    (Reducing by:

    • $100k for meeting the Community Access measures;
    • $50k for meeting the Building Safety measure
    • $50k for meeting the Insurance measure
    • $100k for meeting the Conservation

      • measures).

  • Outgoings & building maintenance

    ANAM is responsible for outgoings and for (condition based & routine) maintenance.

  • Duration

    35 years if ANAM makes an up-front capital investment of $20.5m in the building.

    An additional 15 years if ANAM subsequently makes a further capital investment in the building of at least $19.5m.

  • Civic functions

    A continued civic presence (including access for Meetings of Council and Citizenship ceremonies).

Council Report

Further detail, including a broader summary of how the proposed lease addresses the intended social/community, environmental and financial/commercial outcomes can be found in the Council meeting report available immediately below.

Read the December 2022 Council meeting report on this potential lease open in new window

Provide your feedback

COMPLETE THE SURVEY

or UPLOAD A WRITTEN STATEMENT

Questions

Frequently asked questions

The proposed lease is long term and high value. So Council would like to consider community feedback prior to making any final decision to proceed with the lease.

This is consistent with Council's obligations under the Local Government Act 2020, section 115.

Council is also cognizant that the matter is likely to be of special public interest, given the social, historical, cultural and architectural significance of the asset.

The terms of the lease are the result of extensive negotiations.

The negotiations have been guided by the Principal Items of Negotiation. These were developed by Council to support performance, risk mitigation, accountability, sustainability and recognition.

At its Ordinary Meeting of 18 March 2020, and of 7 September 2022, Council instructed that any potential lease agreement with ANAM is to address the Principal Items of Negotiation.

At its Ordinary Meeting of 18 March 2020, after considering the options, and feedback from its online survey, Council resolved to proceed with negotiations with ANAM for a new long term lease of the South Melbourne Town Hall.

Two rounds of negotiation were undertaken, the second required due to ANAM needing to reshape its proposal. The outcomes of the negotiation rounds were publicly reported.

On 7 September 2022 Council authorised Officers to continue negotiations with ANAM for a new long-term lease of the South Melbourne Town Hall.

Several community groups have in recent years occupied part of the South Melbourne Town Hall. The proposed lease does not provide dedicated space for them.

That said, the proposed lease supports use of the building by community organisations generally.

For instance, it requires parts of the building to be made available for public hire, with a discount of at least 50% for community groups.

Additionally, under the proposed lease, ANAM is to establish a South Melbourne Town Hall Cultural Fund, and contribute to the Fund $1 for every ticket sold over $20. The purpose of the Fund is to support the presentation of arts and cultural activities in City of Port Phillip, including subsidising venue hire charges for use of the South Melbourne Town Hall venue.

The proposed lease requires ANAM to provide the South Melbourne Symphony Orchestra an access licence to use the Main Auditorium for performance and rehearsal, alternative suitable spaces where the Main Auditorium is unavailable, and facilities suitable for secure storage.

ANAM has been a tenant at South Melbourne Town Hall for about 25 years, and its current lease (of part of the building complex) is due to expire in 2032.

ANAM has temporarily relocated elsewhere to enable City of Port Phillip to undertakes structural integrity investigations and repair at the South Melbourne Town Hall.

If Council ultimately resolves to proceed with a new lease to ANAM, the current lease to ANAM will be surrendered.

ANAM proposes to continue to use South Melbourne Town Hall as a classical music performance training and performance venue.

Additionally, it plans to restore and upgrade the South Melbourne Town Hall to boost its potential as a creative, learning, community and cultural destination venue.

More information can be found on ANAM's project page here.


ANAM is required to invest $20.5 million in the building, prior to the proposed lease commencing.

The general scope of the work is specified and includes, for example: restoring several rooms, insulation improvements, adding solar panels, repairing windows throughout, incorporating heating and cooling into the Main Hall.

The completion and spend is to be independently certified.

Council will be undertaking about $15m of work to bring the South Melbourne Town Hall to a basic, tenantable condition.

This will proceed whether or not Council proceeds with the lease to ANAM.

The works are currently being designed and procured, to commence in 2023. More information about that project can be found here.

In 2019 ANAM put a preliminary, unsolicited proposal to Council to lease the South Melbourne Town Hall.

Council asked Officers to review that proposal in order to determine whether to enter substantive discussions with ANAM about that proposal.

As part of reviewing the proposal, City of Port Phillip wished to first:

  • understand/clarify the significance of the place; and
  • consider what uses are appropriate to the significance of the place.

    • To assist in this, City of Port Phillip sought public feedback through the 2019 online survey Have Your Say: What does South Melbourne Town Hall mean to you? The submissions received to that survey were publicly reported to Council. Here are the links to that Council report and its appended submissions.


    The community consultation related to the specific ANAM lease proposal that existed at that time.

    The current consultation is about the principal terms of a proposed lease - the outcome of negotiations about a more recent ANAM proposal.

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