Melbourne Club moves to block Justin Hemmes’ Paris End hospitality precinct
Sydney hospitality magnate Justin Hemmes faces a major hurdle in his plans to transform a central Melbourne car park into a "hospitality, entertainment and creative wonderland", after the prestigious Melbourne Club moved to block the project.
Hemmes' Merivale Group purchased the eight-storey car park on Little Collins Street from the City of Melbourne in February for A$55 million, unveiling a proposal to establish a multi-level precinct featuring a boutique hotel, restaurants, bars, galleries, and a sky garden.
However, the Melbourne Club, which has occupied nearby premises at 36 Collins Street since 1859, has exercised a long-standing legal option to acquire a 50% stake in the existing lease over the car park, which has 12 years remaining. A source from within the club, which traditionally avoids public commentary, stated it was unlikely to enter negotiations with Merivale regarding the lease.
The club, whose 1,500 members include prominent figures from Melbourne’s corporate, legal, medical and political circles, considers the car park essential for members and guests. The proposed redevelopment, located metres from the club’s Victorian Heritage-listed private garden, has reportedly provoked significant concern among its members.
The car park’s lease is currently held by property fund Dexus, which had been expected to negotiate a settlement with Merivale to terminate the lease early. However, following a private meeting on 31 March, Melbourne Club members voted overwhelmingly to proceed with exercising their option, at a cost of approximately A$5.5 million.
A club insider noted Hemmes’ plans, supported by Melbourne’s Lord Mayor Nick Reece, had triggered consternation among members regarding the potential impact on amenity at the top end of Collins and Little Collins streets. "They’re more than willing to stand up to him ... They’ve definitely got the funds, and they also have access to some of the city’s best lawyers if it comes to that," another source said.
Dexus and the Melbourne Club both declined to comment on the matter.
A delay to Hemmes’ project could significantly impact the City of Melbourne’s efforts to revitalise the area, which has struggled with reduced foot traffic and economic challenges following the pandemic. Reece described the development as key to boosting Melbourne’s hospitality sector, stating: "This deal is the right move to propel our hospitality scene even further – adding to our extensive collection of venues, driving visitation and cementing Melbourne’s reputation as the best place to do business."
However, the council’s handling of the sale has attracted criticism. Councillor Owen Guest, who voted against the sale, argued that the A$55 million price did not reflect the site's true long-term value. "They’ve picked this up for a song, and I think that will be clear in the value of the land in years to come," he said.
Hemmes, who is scheduled to settle on the property in June, said at the time of purchase: "This is our boldest and most innovative project that we have embarked upon to date, a vision that I’ve been conceptualising and refining for a decade."
Melbourne City Council confirmed that Merivale had been informed of the Melbourne Club's legal rights prior to the sale. Merivale and Hemmes did not respond to requests for comment.
Jonathan Jackson, 28th April 2025
