Otumoetai College principal Dave Randell and Tauranga Boys' College principal Robert Mangan said the joint campus would help keep young people in town, in turn helping with employment.
Bay of Plenty Polytechnic chief executive Dr Alan Hampton said the new campus would provide infrastructure and capabilities to make the region far more attractive to keep young people in Tauranga and also attract them here from other regions.
University of Waikato deputy Vice-Chancellor Professor Alister Jones said although there would be a number of conditions laid out for the university, they were excited about the funding for the development.
Tauranga Chamber of Commerce chief executive Max Mason said young adults who stayed in the Bay to study rather than going somewhere else were this community's lifeline to the future.
"This decision took great political skill to pull together and congratulations are in order."
Priority One chief executive Andrew Coker said the development of a university campus and the tertiary education partnership would provide long-term benefits and play a critical role in supporting sustainable regional economic development.
Also in the pipeline is $5 million in funding from the regional council towards the development of a marine precinct at Sulphur Point, involving a boat lift and the construction of a sea wall and hardstand for the boats to stand in after being lifted from the harbour.