The state of the Royal Society buildings was causing serious concern at this period, and a detailed proposal estimated to cost £800 was submitted to the council by a special sub-committee to overcome these disabilities. The proposal called for the altering of the building to provide a meeting room 33 ft. square with the full height of the existing hall, fitted with rising slats like a lecture theatre, two rooms on the ground floor each 22 ft. by 16 ft. which would be used as a council room and secretary's room, and also a 'handsome' room on the first floor 33 ft. by 22 ft. for a library and reading room which would be open daily. It was estimated by the architect that these proposed alterations would cost approximately £450, together with £350 for a caretaker's cottage. This immediately brought an outcry from some members for the removal of the Society to another locality, the existing site being described as 'a desolate one'. The new site most favoured by them was the Public Library reserve, where it was hoped all the scientific societies and collections would collect, but it was later pointed out to them that it was much better to remain on a site that was their own than to build on a place in which they would only be on sufferance.

This proposal being rejected by the members, the council was given authority to call for tenders. At the same time, it was recommended that a lodge should be erected in the grounds where an attendant could reside and safeguard the property of the Society.

Tenders for the above alterations to the hall were called early in 1869, and the tender of John Woods, a building contractor, for £415 was accepted-those for the lodge being deferred. During alterations to the building, meetings of the council took place in the Town Hall Chambers, while meetings of the Society as a whole were suspended. On the completion of alterations to the hall, it was decided to proceed with the construction of a brick lodge at an estimated cost of £330, the combined works being completed during August 1869, when regular meetings again were held in the building. The financing of these alterations presented some problems, and it was decided to approach the government with a request that the sum of £800 be placed on the estimates to enable this work to be carried out. However, a flat refusal was forthcoming from this source, and the whole project was then brought back to the Society for private financing.

Royal Society of Victoria