The building's demolition aims to improve clear sight lines north to Eat Streat and the lake, south to Rotorua Central Mall and east to the Polynesian Spa.
The council's inner city portfolio leader and councillor Karen Hunt said the demolition of the "apricot fans" and tiling of the area would also be completed during the first block of construction.
"After December 18 the space will be open and there will be no signs of construction.
"We did consider grassing the area but with an impending drought we wanted to make sure the space would fare well over the summer season."
Mrs Hunt said traffic would not be able to move through the space until phase two of the construction was complete.
"Allowing traffic to move through the area requires some re-engineering which won't happen until Easter. This first stage of construction was more about preparing the space for its revamp."
A short ceremony was held last Monday in the building to acknowledge the end of its 20 years in the heart of the city centre.
It was led by Reverend Tom Poata who described the ceremony as a "symbolic thank you to what the building has given".
Mrs Hunt said the urgency to have the building removed was largely to do with increasing safety.
"We wanted to open up the space and improve sight lines so people would feel safer in the area. As well as that we wanted to improve visibility for those retailers previously obscured."