One of Melbourne's favourite live-music venues, The Esplanade Hotel, will close its doors for months on end in order to complete major renovations, which sources say will include a new elevated restaurant.

The St Kilda pub known affectionately as "The Espy" will shut on Sunday May 17 and will not reopen until the summer. It is understood musicians who were booked in for gigs after this date have been asked to find an alternative venue.

The Esplanade, St Kilda Credit:John Lamb

In a statement released late on Monday afternoon, it was announced that the "extensive" revamp would include sound and lighting upgrades of the Gershwin Room (which hosts the television show RocKwiz) and new food and beverage spaces.

"Once our renovations are complete, The Espy will have opportunities to view the stunning bay and sunset views from this prime location overlooking the foreshore," it said.