The University of Waikato is providing nearly 100 more beds for students at the new Tauranga campus.
The three-story multimillion-dollar development in Selwyn St aims to fill some of the accommodation shortfall in the area.
It is being purpose built by QP Properties Holding Limited.
Senior Vice-Chancellor Professor Alister Jones said the new educational precinct was a critical part of delivering a successful city.
"The new accommodation block will help strengthen the culture and life of the university, and having a community within the CBD also helps create a more vibrant city."