A foundation was poured for the new Mount Maunganui Lifeguard Service building this week, using 46 truckloads of concrete.
The original plan was to rebuild the leaky club on the existing foundations, but the club said a geotechnical survey in June 2017 revealed that was not possible and significant remedial work was required.
A $900,000 funding shortfall for the project was mainly due to the unexpected foundation work.
Club chairman Paul Manning said, however, there were significant advantages in starting from scratch.
He said the new tilt-slab building technology meant there would be more usable space in the basement for larger changing rooms and space for craft and emergency vehicle storage.