Council and the construction businesses involved in the redevelopment of Ballarat's Bridge Mall are confident cost increases won't impact the project's budget.
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The City of Ballarat met with construction team 2Construct and the Bridge Mall Business Association on Thursday to mark the beginning of the construction of the redevelopment.
The first stage of the redevelopment features a $1 million playground and removal of the main canopy, street furniture and pavers.
Mayor Des Hudson said the development's budget and timeline should be met.
"Can we always guarantee that? No, we can't due to unforeseen circumstances but we will work has hard as we possibly can so that we can deliver as much of the project, if not all of the project, without having to come back to council," he said.
2Construct managing director Duncan McPherson said he was confident the project would meet its budget despite an increase in costs.
"The construction industry has pretty much stabilised at the moment," he said.
"We've paid all the deposits for the street furniture, paving and hard stone elements, so from that point of view the costs are locked down."
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Controversy has surrounded the project since it was proposed and Cr Hudson said it was time for the council to make the investment.
"All you have to do is walk through the mall and look around at the total number of vacant shops," he said.
"If nobody did anything in this area, it would be death by 1000 cuts. We had to bite the bullet."
Bridge Mall Business Association vice-president Shane Donnithorne said the project was years in the making.
"We started this conversation about six years ago with the association and the council wanting to do something in this space," he said.
"For the last three years we've been planning. Now we're here today, it's exciting."
Traders' shopfronts have full access throughout the development with dedicated pedestrian walkways.
Mr Donnithorne said the association was working with the construction team.
"We're advertising it as business-as-usual," he said.
Night-time works were scheduled to reduce noise pollution for traders and shoppers during peak times.
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