The Clutha Licensing Trust announced on Tuesday work would begin on a replacement for Balclutha’s Hotel South Otago early in the new year.
Trust general manager Ross Balloch said rising construction costs and staff changes had delayed the project by about a year, but the trust was now excited to be able to move forward.
"The trust has talked about this for years, and we’re super excited to be able to announce progress today," he said.
"This will be an appealing suntrap in a prime location for locals and visitors alike, promising a contemporary and inviting gastro-pub environment.
"We’re eager to open the doors to an establishment that will become a cornerstone of our community."
Mr Balloch acknowledged community concern over delays in the original construction deadlines, after the project was announced in June last year.
"We’ve had some changes in staffing at the trust, including my arrival six months ago, and it’s been a challenging construction environment with rising costs.
"We’re now embarking on this project while embracing fiscal responsibility, and with minimal debt to allow us to continue to support the community."
Original replacement plans detailed a 340sq m, single-storey venue for 120 patrons inside and 100 out, costing $3 million.
That had been trimmed to take the current financial environment into account, Mr Balloch said.
Although he would not give a revised cost, it was "substantially lower" than the original $3m projected, he said.
The new venue would be 260sq m, remain single-storey, and still cater for about 120 inside.
Savings had been made on the outside areas, which would now host 60-80 customers, he said.
The Calder Group, of Wānaka, will oversee the build, delivering an open-plan layout with indoor and outdoor dining options, a bar, a dedicated gaming room and entertainment spaces.
It will replace the former Hotel South Otago, called the "Southy".
The hotel, built in 1959, was demolished last October, after the cost of earthquake strengthening was found to be uneconomical.
The trust hoped the new venue would be open by next spring, Mr Balloch said.
