The move has the potential to open up more options for the state government's GovHub proposal, which is intended for the neighbouring site.

Council at its Wednesday meeting voted to sell the land bordered by Lyttleton Terrace, St Andrews Avenue, Market Street and Mundy Street to make way for the $90 million project.

The city has made an offer on the Doherty's Garage site, which is on the opposite side of Market Street to where the 1000-desk building will be constructed. 

City of Greater Bendigo chief executive Craig Niemann said the offer had been accepted, but the sale of 7 St Andrews Avenue had yet to be finalised. 

Almost all of the surrounding land is owned by the council, the exception being access to the rear of the Golden City Support Services offices on Mundy Street.

"Council hasn't got a formal plan for the property at this point in time," Mr Niemann said.

But he said the site might form part of future development opportunities.

The GovHub is one of a number of major projects planned for the Bendigo CBD, such as the new law courts and the redevelopment of Bendigo TAFE's city campus. 

Mr Niemann said there were other private developments that might happen in the city centre.

He said the site of the former mechanic shop might be appropriate to address future car parking needs.

Mr Niemann said the potential acquisition of Doherty's Garage did create some options to consider as part of the GovHub development.

He did not disclose the sum agreed upon for the purchase of the St Andrews Avenue site.

Mr Niemann said there was a valuation for the land, and the price reached was that valuation.

Elders Real Estate has the property marked as under contract, with a value of $700,000.

Doherty's Garage has previously been of interest to local government.

Back in September 2017, when the property was about to go on the market, Cliff Doherty told the Bendigo Advertiser he remembered council planners in decades past telling his father, Alf, they wanted to acquire the property.

“[He said], ‘Maybe it’s time you picked up your clipboards and used the door for the last time’,” Mr Doherty recalled.

But the family's position had since changed, becoming open to the council's interest.

Doherty's Garage was established in 1954. The mechanic shop closed in January 2018.

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Plans for the GovHub, including how much of the neighbouring Lyttleton Terrace site it will occupy, have yet to be decided.

But Mr Niemann expected they would incorporate a degree of parking.

Regional Development Victoria, Development Victoria and the council will work together on the GovHub.

"There will be a lot of conversations before any real project planning takes place," Mr Niemann said. 

He said it was likely there would be a Memorandum of Understanding between the parties.

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Member for Bendigo East, Jacinta Allan said it was great to see the GovHub project take the next step.

"We can now move into that next important development stage, start to finalise the plans and see construction get underway," she said.

The City of Greater Bendigo will be a tenant in the GovHub, with up to 400 desks allocated to its staff. 

The state government is expected to use the other 600 desks.

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