In the mid-2000s, the City of Port Phillip, managers of the land, proposed a large-scale redevelopment of the St Kilda 'Triangle', the site including the Palais and the adjacent car park. The lease of the site and building, which was nearing its end, was not renewed with the then-lessee, who controversially removed a number of items, notably the Spanish-style lobby chandelier. After various court cases, it was determined that their ownership by the former lessee was valid, and they remain in storage as of 2017.