The former VicRoads site in Kew will not be retrofitted for housing, after the state government made a last-minute pivot and decided to completely demolish the former municipal building.
The future of the 2.5-hectare block on Denmark Street has been a source of debate for over a decade. It has long been sought after by developers due to its size, transport connections and location in an affluent suburb.
On Thursday, a government spokesperson said in a statement that the decision to demolish the building and develop a new precinct would offer the best housing outcomes for the community.
Demolition of the seven-storey structure will commence this week and is expected to be completed by mid-July. The government has previously said that a total of 500 homes were expected to be built across the site, with 125 within the retrofitted building.
“Following extensive work with industry, the southern building on the old VicRoads site will be demolished,” the government spokesperson said.
“This will deliver more homes than originally planned while creating high-quality open space and better connections through the precinct.”
The spokesperson was unable to provide details on how many houses would be built on the site, or about how tall a new development would be.
Last year, Development Victoria was investigating whether the building could be refurbished to accommodate 125 homes, as part of a program that would encourage developers to retrofit old buildings for residential use.
The state government has previously flagged its intention to sell the land to developers that would be required to allocate at least 10 per cent of dwellings as affordable homes. The loosely defined term intends to provide housing for people on low to moderate incomes.
But there have also been calls, including from Kooyong MP Monique Ryan, to turn the site into a more significant allotment of social and affordable housing.
Additionally, Boroondara Council has long been pushing to gain ownership of the “tail” section of the site, a thin section of land that it would like to develop into green space and a bike path.
Boroondara Mayor Wes Gault said that the council had submitted a proposal to the planning minister to buy the “tail” land.
“The former VicRoads site in Kew is an exceptional location for a new residential development, and we look forward to seeing its redevelopment in the coming years,” Gault said.
Refurbishing the original building, which opened in 1961, would have been a major project. When The Age toured the site in early-2025, there were visible signs of age and questions as to how the structure would be brought up to date with modern building regulations.
Demolition works were recently completed on a second building at the north of the site, which was always expected to be removed.
Nearby residents can expect increased noise, dust and vibration – as well as increased truck movements – across the duration of the works.
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Gemma Grant is a city reporter at The Age. Contact her securely on Signal at gemmagrant.88Connect via email.