In this case, you probably need to go down to Java itself. Study the source code of Server and Client, look at the Java reference of the classes and methods they use, and see if this can modified to more targeted communication. More work, but perhaps less than going the encryption way.
Note that messages are still broadcast on the network, but the client listening will be done at a lower level, reducing the risk of interception. If you use a tool like Wireshark, you can see you can observe most of the communications done on a LAN.