The university this week confirmed it paid around $20 million for the Elizabeth Towers Hotel, on the corner of Elizabeth and Grattan streets in Carlton.
The hotel is almost swallowed by the university, which has built classrooms and research centres north, east and west of Elizabeth Towers.
A spokeswoman for the University says in the medium term it plans to lease the hotel to its existing operators – but that the site, opposite the main Medical faculty building, will eventually be redeveloped.
“The expectation is that the University will expand its medical teaching and research facilities to the site,” she said. “We constantly have new medical research centres looking for accommodation.”
Last year, the University paid $26.4 million for a 9,500 square metre, B-grade office building it had leased for 15-years prior, at 258 Queensberry Street.
Rival Royal Melbourne Institute of Technology has also been snapping up inner city buildings. Last year it paid $7.25 million for the former Health Services Union building at 106 Victoria Street.
Until 2006, RMIT was sitting on what was regarded one of the city fringe’s most prized development sites, the former CUB Brewery on Victoria Street.
The University sold all but a small portion of that 1.9 -hectare site to Grocon in October that year for $39 million after it couldn’t afford to develop on the site itself.