The 113-year old building on the corner of Rockingham and Cockburn roads has been vacant for some time, with numerous development proposals failing to come to fruition.
But new owners have come on board with a plan to turn the old building into a dance school.
Council backed a change of use for the site from "hotel" to "health studio" last week because restoration work will enhance the significance of the heritage-listed site, improve the streetscape and there was strong support form neighbouring lot owners.
Cockburn's planning and development director Daniel Arndt said revitalisation work would have "minimal impact on the fabric of the building".
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"Both the Heritage Council and the City officers believe that its use as a dance studio and associated dwelling will allow the refurbishment of a significant heritage building and permit users to appreciate its unique internal spaces and layout," he said.
"The external restoration will also again herald the entrance to City of Cockburn."