The former backpackers lodge in South Warrnambool will be turned into a school camp under plans submitted to the the city council.
To be called Warra Ngan, it will cater for school groups of up to 96 for 30 weeks of the year.
It will fill a gap in registered school camps in south-west Victoria with only three in operation - some of which were booked out years in advance.
"With Warrnambool being the largest urban centre there is a strong case for establishing a school camp in the city," the planning application to council says.
The site could also be made available for group bookings when not being used by school groups.
"Group sizes will be limited to 60 with a minimum stay of two nights," the application says.
The camp would be run by two experienced school teachers who are also joint owners of the business.
The six partners involved in the project are married couples from the Warrnambool area.
The site, in Stanley Street, was previously a backpackers lodge and maritime museum and was put on the market late last year by expressions of interest with a price range of between $1.5 and $1.6 million.
The term Warra Ngan is from the Peek Whurrong people meaning water hole near the mouth of the Merri River and was selected as a name for the facility by local elders.
"Our plan is to incorporate much of the local indigenous history and culture into the structure of our school camps," the applications says.
"Each week, two two-night camps will be delivered with one cohort arriving on Monday and leaving Wednesday, and the other arriving Wednesday and leaving Friday."
The idea would bring 3600 students to Warrnambool - cementing the city as a holiday destination for future generations.
Objections close August 11.
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