Melbourne Club: Iconic establishment tries to fight off Sydney dining king, Merivale Group owner Justin Hemmes

Melbourne’s most conservative establishment is determined to repel one of the symbols of flashy Sydney.

The Melbourne Club — for more than a hundred years home to the city’s business leaders — has decided to use a long-dormant financial contract to block the construction of a nightclub-and-restaurant complex across a lane from its heritage-listed club house.

Merivale Group owner Justin Hemmes has been working for years on a plan to import a dining-and-drinking style that has redefined Sydney hospitality to the self-consciously hip Victorian capital.

Members of the Melbourne Club voted on March 31 to spend $5.5 million buying half the lease over the car park, which overlooks the club’s famous garden, The Age reported Monday.

Melbourne City Council agreed in February to sell the physical building to Merivale, believing what Mr Hemmes’ called his “boldest and most innovative project” could revitalise the eastern part of central Melbourne, which never recovered from the COVID pandemic.

But neither the council or Merivale control the car park lease, which is owned by Dexus, a professional property investor listed on the share market.

‘No deal’

Melbourne Club sources told The Age they would not accept Merivale’s offer to cancel the lease, which has 12 years left. Many use the carpark, but their opposition likely comes from a desire to avoid hundreds of young people from the suburbs coming to the mostly quiet part of the city each night.

The intervention could leave Mr Hemmes stuck with a carpark until 2037, unable to prove that his thriving Sydney-based empire can be successful in a city proud of its reputation for cool laneway bars and restaurants.

Mr Hemmes wants to turn the carpark into an 11-storey dining, drinking and shopping complex similar to The Ivy district in central Sydney, which has one of the city’s most popular nightclubs.

Some Melburnians are sceptical of the Sydney entrepreneur, whose company has opened 90 hospitality businesses over 60 years, offering fashionable venues inspired by European brasseries selling high-quality food and alcohol at cheaper prices than the fine dining restaurants that used to dominate the city.

In the era of Instagram, many of Merivale’s venues have become popular with younger, aspirational diners — the opposite of the older, wealthy men who have long made the Melbourne Club a home for the city’s social and business elite.

Blow to the mayor

The secretive club does not reveal who its officials are, but has access to many of Melbourne’s top lawyers and business strategists.

An employee of the club said Monday morning: “There is no one here today who can comment, I’m afraid.”

“He should never have been allowed to buy that car park for that price in the first place,” Melburnian John Vizard wrote on Facebook Monday.

Melbourne’s mayor Nicholas Reece is personally backing the project, and its failure would be a blow to his plans to revitalise the city’s nightlife.

When he negotiated the sale, Mr Hemmes said: “The revitalisation and repurposing of this under-invested yet wonderful site has the potential to be an incredible addition to the fabric of Melbourne.”

A spokesperson for Merivale had no immediate comment when asked about the Melbourne Club’s decision.

In November the company agreed to pay $19.25 million to settle a lawsuit from ex-employees who alleged they were underpaid after five years of legal arguments.