The development would be built on land owned by Manor-Group Investment.
Earthworks for the 7000sq m office and retail complex would start in October, and construction was due to be completed next November, Mr Yates said.
An Inland Revenue spokesperson said: "The entire staff of our Tauranga office will relocate to the building in late 2016.
"The terms and conditions of our lease agreement are commercially sensitive, so we are unable to provide further details relating to the agreement," the spokesperson said. Inland Revenue is a tenant of Regional House in Elizabeth St, while Housing New Zealand staff work from a leased office in Grey St. In a written statement Housing New Zealand area manager Teresa Pou confirmed its Tauranga office would be relocated to the new building. "Up to 20 of our Tauranga-based staff could move to the new building once it's completed in late 2016. We'll be just one of the tenants and will occupy less than one floor of the building.
"Our current office is a leased space which is larger than we require and no longer suitable for our purposes," Ms Pou said.
Mr Yates said nine tenants had already moved out to make way for major demolition works.
The last two tenants would move shortly, including Novelty - an Indian sweets and snacks store.
Novelty's director Puran Singh said he expected to move into a new store a few doors down in two-to-three weeks, which was previously occupied by a lunchbar and Tauranga Book Exchange
Mr Singh said he had secured a 10-year lease.
"It's very exciting as I will not only have a brand new shop but it's 50 to 60 square metres bigger than my current shop, and I'm also looking to employ two extra staff," he said.
Bay of Plenty Regional Council's general manager finance Mat Taylor said regional council staff occupy two floors of Regional House.
The regional council had no plans to move elsewhere," he said.
Mr Taylor said the council was yet to decide on a replacement tenant for Inland Revenue.
