The Yellowknife post office is located at the corner of Franklin Ave., and 49th Street, in the heart of the city's downtown. ((CBC))

A "For Sale" sign stands outside a downtown Yellowknife landmark this week now that federal officials have apparently decided to sell the local post office building. The asking price is $1.6 million.

Built in 1956 as Yellowknife's first courthouse, the building at Franklin Avenue and 49th Street is one of only a handful of heritage buildings around the N.W.T. capital.

It currently houses the Yellowknife post office on the ground floor and has vacant office space on the second and third floors.

The building's central location also makes it a popular public gathering place outside.

"The post office has been here for over 50 years. It's the crossroads of the downtown," said Kevin O'Reilly, a former Yellowknife city councillor who lobbied for the building to be designated a heritage building.

"Everything's gone on in front of the post office here, from protests to ticket raffles, people meeting old friends. This is where you want to be in downtown Yellowknife. And it's for sale now!"

Local real estate agency Coldwell Banker had a "For Sale" sign lodged in a planter outside the 13,500 square-foot, three-storey building Thursday.

Post office manager John Abbott told CBC News Thursday that he was surprised to learn the building was for sale, when the real estate agent brought the sign around.

Abbott said Canada Post has 3½ years remaining on its lease, and the post office has no plans to move.

O'Reilly said he's worried that whoever buys the building would try to make changes to the historic building — and succeed.

"The protection in the [city's] heritage bylaw is not very strong," he said.

"It just states that if you want to get a development permit, and change the building in some way, it has to go through an extra hoop of being reviewed by the Heritage Committee, and those recommendations are non-binding in any way."

No one from the federal Public Works Department was available to talk about why it's selling the building.