Mr Martin said a $250,000 grant from the Rotorua Energy Charitable Trust would kick start the project.
"The scouts were looking for a new venue, and our netballers have never had a place to train, they have to go into Rotorua to practise."
He said each group would help maintain the building, which would also have a kitchen and toilet block, with Progress Ngongotaha-Kokiri Ngongotaha being responsible for the development. "Our focus now is on our youth and our elderly, not so much on the commercial aspects of the town.
"We want other organisations to be able to use it as well."
Mr Martin said the terms of the lease had yet to be finalised, but the plan was to have the facility up and running within three years. "We have to put a business case to the trust and council by March, and we are underway with that process."