Shangri-La Melbourne hotel slated for conversion to apartments

The 61‑storey Shangri‑La hotel overlooking Melbourne’s Carlton Gardens, part of a $600 million twin‑tower complex completed in August 2023, remains an empty concrete shell. Originally planned for 500 rooms with an opening in 2024, the launch has been delayed to 2026 and the building has seen no interior fit‑out.

Developer Setia (Melbourne) Development Company, a subsidiary of Malaysian conglomerate Setia SP, has applied to the Department of Transport and Planning for a permit to convert the hotel tower into 393 residential apartments. A department spokesperson said, “Any proposal will be considered on its merits – as this application is currently under assessment it would be inappropriate to comment further.”

Setia reported a $14.4 million loss for the financial year and noted that construction had not begun. Disagreements over pre‑COVID fit‑out costs between Setia and the Shangri‑La brand contributed to the stalemate. The adjoining 59‑storey residential tower, Sapphire by the Gardens, houses a $39 million penthouse owned by billionaire Adrian Portelli.