The space occupied by emergency roms below the 1970s County Hall in Cwmbran is too big to be filled by the rubble of the six-storey building.
Monmouthshire and Torfaen councils had hoped to make £4m from the site’s sale.
But the cost of filling in the void has cut likely earnings to £275,000.
The building opened in 1974 and closed in March after a report showed it would cost £30m to repair after a report showed it was suffering from concrete cancer.
The building is currently empty while contractors submit bids for the soft-stripping work ahead of full demolition next year.
A Monmouthshire council spokesman told the BBC: “Although we have always known what was down there, there are a couple of service tunnels and sink holes that we need to look at.
“Soil has been washed away by sumps which has been leaking water. Over the years, a large amount of soil has been washed away.
“There is a larger space under there than we anticipated. It is a very great hole.”
Engineers will go down to find out how big the void is now and calculate how much more material will need to be brought in to level the site.
The spokesman said: “Material has to shipped in to completely fill the hole. It all has to be filled in to acceptable standards.”
“There is still more space in the void than there is building to fill it.”
Monmouthshire council leader Bob Greenland said: “It is clear there was quite a bit of space under that building.
“I did not think it would be a problem in terms that there was not enough rubble from the buildng to fill that void.
“I thought we would be carting material away from the site rather than having to import material.”