The expanded terminal will have automated check-in, roomier departure and arrival areas, and a separate luggage collection area.
During construction, the check-in and departures area will be moved into a building currently used by the Bay of Islands Aero Club. Work to convert the building is due to be completed by the end of March.
Far North Holdings chief executive Andy Nock said the project was supposed to start last year but was pushed back to future-proof the design against the potential introduction of new airport security requirements.
The winning tender to build the new terminal would be announced in April.
Mr Nock said passengers using the temporary departure and arrival facilities were likely to experience some disruption.
Public meetings at the Kaikohe RSA on March 5 and the Turner Centre in Kerikeri on March 6 would brief airport users about what to expect during construction and what the finished terminal would look like. Both meetings would start at 5pm.
Air New Zealand's withdrawal from Kaitaia had generated extra passenger numbers at Kerikeri but most of the growth was because of increased tourism and business traffic between Auckland and the Bay of Islands, Mr Nock said.
The growth had been enabled by larger aircraft and boosted by effective marketing, including a close partnership between Air New Zealand and the Bay of Islands Marketing and Promotions Group.
The national carrier had been operating an extra three flights a week between Auckland and Kerikeri since November. In the second half of 2017, 6000 more passengers used the terminal than in the same period in 2016.
