A push to convert Adelaide’s dormant landmarks into housing is gathering pace amid a rise in the number of empty office blocks, neglected heritage buildings and dilapidated pubs slipping into a state of decay along the city’s cultural and business boulevards.

Two years after launching a program to help convert vacant spaces above CBD shops into short-term and residential accommodation, the Adelaide City Council is shifting its focus to larger city buildings.

Lord Mayor Jane Lomax-Smith said the state government-backed program, known as Adaptive Reuse City Housing Initiative (ARCHI), was helping to boost housing stock in the city while reviving dormant office, heritage and pub buildings.

“We’ve had maybe 100 inquiries over the last couple of years, but it’s starting to have an impact,” she said.

“We initially started with shop-top vacancies because that’s easy and it’s only one floor. We’ve got 29 beds last year … and we’ve got 37 projects still in the pipeline so it’s moving along.

“Having had a proof of concept with the shop-tops, we’re now moving into taller buildings … and they’re more challenging for a range of reasons.

“But we’ve been very keen to invest in a strategy that will reuse those buildings. And the reason for doing that is vibrancy. It’s about having more people around the street and the building. It’s about the economic benefit to city businesses like retail, cafes, restaurants. It’s also about financial sustainability for the property owners.”

A citywide audit in 2024 identified almost 150 city buildings as potential adaptive reuse properties, with the ARCHI program offering grants and financial incentives to help property owners with conversion costs.

Empty city landmarks include heritage buildings like Edmund Wright House on King William St and Gawler Chambers on North Tce, and historic pubs like the Duke of York and King’s Head hotels where developers have seized on the challenges facing publicans in the city by acquiring the sites with plans for high-rise developments.

“Post-Covid and in the last 20 years generally, young people have been drinking less, and that has affected the night time economy,” Ms Lomax-Smith said.

“And the cost of running a business is really challenging for pubs and music venues. There are cost of living issues that affect the venues as well that are punitive, and they (publicans) cite more than anything the insurance costs and the alcohol taxes.

“Where there are derelict buildings that are in a poor state, they’ve been bought by developers who have failed to advance their plans.”

A growing number of city offices are also becoming vacant amid an uncertain economic outlook and as city businesses adjust their accommodation requirements in line with the shift to hybrid working.

Property Council figures released last week revealed the CBD office vacancy rate had increased from 15.5 per cent to 16.3 per cent over the past six months, well above the long-term average.

The current vacancies include two office towers on Grenfell and Franklin streets which are almost entirely empty.

Property Council SA executive director Bruce Djite said most of the vacancies were in the city’s ageing towers, and the high costs of refurbishing those buildings or redeveloping them for other uses was a major challenge facing owners.

“Not every lower-grade office building is suited to being repurposed. Especially in an increasingly challenging, high inflation, high interest rate and escalating cost environment,” he said.

“It is often more viable to demolish ageing buildings to replace them with all-electric, higher-grade, new mixed-use assets.

“Government can play a role by ensuring planning settings are flexible, approval pathways are efficient and incentives are available to encourage investment into ageing commercial assets.”

Mr Djite said the higher cost and complexity of upgrading heritage buildings had led to the neglect of many of the city’s historic landmarks.

“More flexibility in planning pathways, clearer guidance in heritage with more nuance around local and state heritage places, as well as more targeted incentives for adaptive reuse of heritage would all help encourage more investment,” he said.

“Heritage overlays often significantly devalue buildings and eliminate any opportunity to breathe life back into those buildings, hence they become stranded assets and decay over time.

“The goal should be to ensure heritage buildings remain living parts of our city rather than sitting vacant.”

Ms Lomax-Smith said the council had recently revamped its heritage grants program to preference projects with “residential outcomes”.

ADELAIDE’S EMPTY LANDMARKSGawler Chambers

The state-heritage listed landmark on North Tce has been vacant since 2004 despite several attempts to redevelop the site by previous owners the Roche family.

Previous approvals for a 15-storey office tower behind the heritage facade never materialised, and instead the building has fallen into a state of disrepair, with prolonged neglect resulting in peeling paint, graffitied windows, water penetration, pigeon infestation, and damage caused by vandals and squatters.

After more than 80 years of ownership, the family sold the property earlier this year to Adelaide businessman Sam Shahin, offering new hope for a revival of one of the city’s historic landmarks.

Edmund Wright House

Edmund Wright House is steeped in history, dating back to 1878 when it became the first home of the Bank of South Australia.

After securing state-heritage listing in 1980 after the state government stepped in to save it from demolition, it became home to a number of government departments, and for many years housed the offices of the Registrar Of Births, Deaths and Marriages.

However it has stood vacant for more than a decade following the departure of the Migrant Resource Centre in 2016.

In 2019, the state government sold the building to Sydney investor Jie Chen, and despite being marketed for lease – with agents suggesting potential uses ranging from office space to a boutique hotel – no tenant has been secured.

Former SA Transport Department building

The office tower on Grenfell St has remained vacant since the Transport Department’s relocation to a new $300m building on Pirie St at the beginning of 2023.

However there are fresh hopes for a revival of the high rise landmark.

LAS Group, headed up by Melbourne developer Les Smith, is considering a conversion of the 20-level office tower into student accommodation or a co-living scheme.

He paid $45.7m to acquire the building earlier this year – less than half of the $103.5m price it previous owners, Singapore-backed Wingate and Melbourne-based IP Generation, paid for the tower in 2018, before the department’s exit.

Former Adelaide Metro office

The trouble-plagued city building, on one of Adelaide’s busiest intersections at the corner of King William and Currie streets, has been dormant since the state government closed the former Adelaide Metro ticketing and information centre in 2019.

Sydney-based developer Equinox Property had initially planned to demolish the building and replace it with a 39-storey Wyndham Grand Adelaide hotel.

However those plans have been drastically scaled back, and the developer last year secured approvals to refurbish and repurpose the seven-storey building, as part of a boutique hotel development that would feature five additional levels built on top of the existing structure.

Developers have until early next year to begin construction, or risk losing their approvals.

50 Franklin St

Despite being completed last December, the newly constructed $100m office tower on Franklin St remains largely vacant.

Developer Kyren Group has struggled to lure tenants into the building as an uncertain economic outlook and the shift to hybrid working causes many corporate occupiers to reconsider their accommodation requirements.

The challenges facing office landlords are reflected in the latest figures from the Property Council, which reveal that office vacancies in the Adelaide CBD rose to 16.3 per cent in July, well above the historic average.

However one positive for new developments like 50 Franklin St is the so-called “flight to quality”, where tenants leave older buildings for modern spaces.

Former Bank of South Australia building

Plans to breathe new life into the heritage-listed building on the corner of Pirie St and Gawler Place date back to 2009, but a series of proposals have failed to get off the ground and the derelict site remains a blight on one of the city’s premier business strips.

Previous development proposals for the site have included office and hotel towers.

Under the most recent plans, the former State Bank building was to be demolished to make way for a new Hyatt Regency hotel.

But Singapore-backed developer Chip Eng Seng Corporation walked away in 2024, and the site remains fenced off as it declines into a state of disrepair.

Former GPO building

While parts of the landmark building, described in the State Heritage register as one of South Australia’s “most important public buildings”, were revived when the new Marriott Hotel opened its doors in 2024, the south-eastern portion under the historic clock tower remains empty.

It was cleared in 2019 when post office services relocated to a nearby outlet on Franklin St, and the future of the vacant heritage space hinges on whether developers push ahead with future stages of development at the site.

Developer Greaton had promised a second stage to follow the first stage Marriott opening, including the creation of a new retail and hospitality precinct within the historic building.

In 2021 it secured approvals to delay the work, and said it would only begin once “economic conditions improve”.

Mismatch Brewing

The future of the pub and brewhouse site at Whitmore Square remains unclear after its sale to new owners earlier this year.

Local brewer Mismatch took over the former Sparkke at the Whitmore Hotel in 2022, and operated from the site for more than three years before its closure at the start of this year.

A syndicate of prominent South Australian and interstate publicans acquired Mismatch from administrators in 2024 after a three-year decline under previous owner, ASX-listed Mighty Craft.

Mismatch confirmed in January that it would not reopen the doors to its former city site, whose future now rests with the property’s new owners.

Newmarket Hotel

There have been plans to redevelop the Newmarket Hotel site dating back to 2015, but for now there seems little hope of action any time soon.

Plans to build twin 32-storey apartment towers on one of Adelaide’s busiest intersections were shelved in 2023 when Australian Unity splashed out $38.5m to take over the site, and while the health giant had its own plans for a new healthcare facility on the historic site, it has since abandoned those plans, listing the property for sale last year.

The 143-year-old Newmarket Hotel building, adjacent to the former HQ Complex nightclub which closed its doors in 2017, has fallen into a state of disrepair during its years of disuse, including significant damage to a famous cedar circular staircase. Any future development would require a major refurbishment of the property.

Former Gallerie Arcade, North Tce/Gawler Place

After years of failed promises, Singapore-based Centurion revealed in March new plans to build three towers as part of a $300m vision for the former John Martin’s warehouse site.

The heritage-listed site has a history dating back to the 1860s, and opened in 1979 as The Gallerie, a multi-level retail arcade connecting North Tce through to Gawler Place, with a direct link to the neighbouring John Martin’s department store.

However it has remained vacant since the closure of John Martin’s in 1998 despite several attempts to redevelop it.

Over the years the arcade has remained mostly empty, with the building’s original fittings suffering vandalism over time, including the removal of shop fittings and damage to escalators, wiring and plumbing.

The future of the site now rests with Centurion, which is promising to start construction on its student accommodation and apartment project late next year.

Meanwhile, the building next door is another longstanding vacancy along Adelaide’s cultural boulevard, nearing two decades of sitting empty following the closure of the former Club 199 nightclub in 2007.

A series of development plans over the years have failed to materialise.

King’s Head Hotel

The decaying former pub has been vacant since closing its doors in 2023 to make way for a high-rise hotel tower.

A two-storey rear wing was demolished, but then the project ground to a halt, leaving a trail of neglect and a building marked with graffiti and bird droppings.

After months of uncertainty, the site was sold by mortgagees last year to local family group AA Advancements.

They’re hoping to revive the once-bustling venue known for championing South Australian produce and music.

Duke of York Hotel

The historic pub is another whose future rests in the hands of developers.

In 2024, Melbourne group TAL GP Projects revealed plans to build a 33-storey student accommodation tower incorporating elements of the existing former pub building on Currie St.

It includes plans to retain and restore portions of the heritage hotel, which would be turned into a cafe for students and the public.

The plans were approved last August, but construction is yet to commence. And the venue remains dormant, with a sign notifying customers: “The Duke is under redevelopment. Stay tuned. Thanks for all your support.”