The 30,000sq m category 1-listed historic building was put on the market by its American owners Ray and Gwynn Joseph earlier this year.
It has 75 rooms, more than 50 of which are leased for low rents by various musicians, artists, photographers, dance and martial arts studios as well as community learning organisations.
Building manager Kathryn Olcott said the building had been sold to a local buyer.
She declined to say who the new owners were or how much it sold for, but confirmed they had bought the building with the tenants in mind and would run it as is.
"At this point, absolutely nothing is going to be happening to the tenants.
"They will be able to stay."
The new owners had no other plans for the building at this stage, she said.
Asked if they planned to repair or upgrade the building in any way, she said she had not had any communication with the new owners on the matter.
"I’m very glad. Everything’s good."
Since the building was put on the market, tenants had been concerned a new owner might evict them and turn it into apartments or a hotel.
Former long-term King Edward Court manager Roberta Coutts and some existing tenants established a working group with the aim of creating a charitable trust, to raise funds to buy the building and maintain it for use as Dunedin’s cultural hub.
The group of tenants had already started lobbying the Dunedin City Council to look into buying the building, which they said might be a suitable site for developing a mid-sized theatre in central Dunedin.
A Givealittle page was even set up to buy the building, raising $180 as of yesterday.
However, the trust and the DCC had been beaten to the sale.
While Mrs Coutts was pleased it had been sold to someone locally, she and others would remain sceptical about its future in the community until more official information had been shared with the tenants.
"I just hope it is true. We will just have to wait and see. Our fingers are crossed," Mrs Coutts said.
Another tenant, who wished to remain anonymous, said tenants had received an email saying it would be run "as it is" in the meantime, until the owners decided otherwise.
"That’s reality. It just means that if they decide to empty the building out, we’ll have to find somewhere else, which will probably be more expensive.
"Hopefully, that doesn’t happen, but we can’t rule that out yet.
"If we have to go somewhere else, we’ll have to adjust our fees to cover our costs."
Former owners Mr and Mrs Joseph were unable to be contacted yesterday.
