Hi Warr - yes - indeed looks like some sea sponge - there are many different colorations and sorts of sea sponges - MOST of them grow in darkness (would be at the bottom or behind the life rock)...
Sorry, cant give you the exact id, but it is a sponge. I have this growing in my frag tank and it is a bit of a pain. It does not stop growning and even grows over the soft corals .
I have to pull them off every few months. They tend to pull off in large bits. Not saying you should do the same, but it can become a pest.
HTH,
Neil