Music fans and heritage advocates are vowing to fight tooth and nail to protect iconic Footscray live music venue the Reverence.

A billboard seeking new owners, placed on the historic hotel on Friday, pitches the site at developers.

An online listing describes the property, built in 1876 and formerly known as the Exchange, as a “fantastic freehold development” with “potential to build to up to six levels”.

The pub comes with an asking price of $3.5 million, putting it out of the reach of most hotel operators.

Agent Mark Durnan said he had been told not to discuss the sale, but denied social media speculation the property had already been sold.

“People are looking at it, but it’s still on the market.”

Leaseholders Matt and Melanie Bodiam, who created the popular Reverence food and music venue in 2012 on a six-year lease, intend to remain until at least May, 2018, when the lease expires.

Mr Bodiam said the hotel has been on the market throughout their lease, but the prominent advertising came as a surprise and created confusion for people who thought they were selling out.

“The Reverence isn’t for sale – the building is,” he said. “The sign was a really big shock to us. The whole talk with the current owners was that we were going to get another lease. Every chat we had with them, they were indicating we could have another five years.”

Mr Bodiam, who grew up in Footscray, said he would be devastated to lose the Reverence, but would also hate to see the building torn down for redevelopment.

“It would be terrible if this building was lost,” he said. “But we are definitely not closing before we have to – we would stay here forever if we could.”

The hotel is one of the western suburbs’ leading supporters of independent musicians. Supporters have expressed shock at the possibility of its loss and the disappearance of another important Melbourne music venue.

The Footscray Historical Society has committed to help preserve the building, which is listed on the Heritage Council database due to its archaeological significance.

National Trust of Australia advocacy manager Felicity Watson said Melbourne’s pubs were increasingly under threat from residential and commercial development.

“Recent community campaigns to save historic pubs like the Great Western Hotel, the London Hotel in Port Melbourne, and the Greyhound Hotel in St Kilda, have highlighted how important these places are to our community and our sense of place,” she said.

“We hope that potential purchasers of ‘the Rev’ will recognise its importance to the Footscray community and to Melbourne’s music scene.

“If Melbourne is to uphold its reputation as a liveable city, we need to protect the places that make it vibrant and an exciting place to live.”