The redevelopment of Tauranga's iconic Farmers' corner has begun, with local workers starting the demolition of two buildings on the site.

About 20 workers subcontracted to Hawkins will spend the next four weeks removing the former Subway restaurant and rear building at 56 and 58 Elizabeth St.

About 400 workers are expected to be involved during the peak construction period.

Elizabeth Properties, part of the James Pascoe Group that owns Farmers, will spend more than $100 million on the flagship project expected to help revitalise the CBD.

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The company's property project manager, Brett Nicholls, said it was exciting to start work on the site after much consultation, planning and preparation.

"This unique offering will create a southern gateway to the CBD, combining retail premises with cafes, restaurants, apartments and townhouses in a way that is yet to be seen anywhere else in New Zealand," he said.

Farmers will continue to trade at the CBD site until the end of this month before moving to Tauranga Crossing while the main building is demolished.

When Farmers returns to the CBD, it will be joined by several new retailers, cafes and restaurants.

The local branch of project management firm RCP, with input from expert consultants, has developed a construction management plan that aims to minimise disruption to the public and neighbouring businesses as much as possible.

The number of car parks available for public use at the site will triple when the new building opens. However, RCP advised the site will have to be hoarded off and car parking reduced during the demolition and construction phases for access and safety reasons.

RCP senior project manager Kelvin Eden said safety and communication were top priorities.

"As is the case with all construction projects, we appreciate that from time to time people will experience some inconvenience," he said.

"We are committed to minimising disruption and keeping the neighbours and the public informed as best we can."

The building was being constructed under an accelerated timeframe to minimise disruption and to provide certainty to Farmers' customers, staff and the public.

Priority One business partnership manager Mark Irving said the large-scale modern retail and residential building would provide new amenities and the opportunity for businesses in the complex to attract more customers and residents to the city.

"Tauranga is ready for a development of this scale, one that will uplift and reinvent retail and accommodation options within the city centre."

Irving said the Farmers complex would assist with much-needed CBD revitalisation while further stimulating local and regional economic growth.

"The high-quality design of the complex will bring a contemporary development element to the CBD and will be a catalyst for change in the surrounding areas," he said.

"A high usage of local suppliers and labour will further stimulate the regional economy and add a sense of action in the heart of the CBD."

Tauranga Chamber of Commerce chief Stan Gregec described the significant development as a "shot in the arm" for that end of town.

"We are going to have a major new magnet in our city centre which will surely set the standard for a multi-use integrated space for retail, hospitality and inner-city living," he said.

"Combined with everything else that's happening, the place will be barely recognisable in another few years."

Mainstreet Tauranga chairman Brian Berry said the development was further evidence of Tauranga's transition from a small provincial city to a regional hub with more housing and inner-city living.

Berry said the Farmers, Trustpower and University of Waikato developments showed a commitment to Tauranga's future.

"Apart from an improved retail offering from Farmers and additional hospitality and retail offerings, the inclusion of a large number of apartments and inner-city dwellers would provide increased pedestrian number on the streets at all times of day," he said.

"The development also includes a substantially increased public car parking offering which will improve access to the CBD."


Landmark Farmers building:

8000 square metres of retail, on two levels
First-floor cafes and restaurants
320 car parks
Public car parks to triple from the current 66
Farmers to return in 2021, taking ¾ of retail space
New retailers to join
74 high-end apartments, in two towers
23 townhouses