The new facility would assure its future in a high-quality facility.
The new location was found after years of searching thanks to the help of Pukeroa Oruawhata Trust, which gave the community hospice a long-term lease for the land at the end of Hinemoa St at a peppercorn rental.
"We've been fortunate to have had the support of the Pukeroa Oruawhata Trust for the past 10 years and to have this support and association extended to a new central site is a fantastic commitment from the trust to the Rotorua community," Ms Black said.
Pukeroa Oruawhata Trust has also agreed to exchange the existing hospice cottage for the former Te Ngako building " a bigger more substantial building, which will be relocated and refurbished to meet ongoing needs.
The Te Ngako building is currently sitting unoccupied on Pukeroa's lakefront land and will be moved to the site once groundworks have been completed.
Ms Black said demand for hospice services has grown alongside the ageing population.
The number of referrals has increased 50 per cent in the past five years.
Ms Black said many people did not realise hospice was hugely reliant on community support, with only half of the costs of running the organisation provided from the public health budget.
"Our service is free.
"Last year, the shortfall we needed to raise was $800,000 to provide and maintain our level of care.
"Without the generous support of the community, we could not have done this."
Ms Black said that the hospice's focus had always been on service delivery " not bricks and mortar.
But, with a team of more than 14 clinical staff, administration staff and supporting social service providers, the current premises was bursting at the seams and the organisation was in dire need of a new location.
She said they had been looking for a new location for five years.
Pukeroa Oruawhata Trust chairman Malcolm Short said the trust was pleased to continue its support of what he described as a highly important and deserving community service provider.
Mr Short said hospice did a huge amount of good in the community, working with individuals and their whanau during difficult times.
The organisation also received a $750,000 grant from the Rotorua Energy Charitable Trust, which had allowed building work to continue.
Rotorua Community Hospice Trust chairman Preston Moorcroft said the level of support hospice had received was truly heart-warming, with a number of local business people offering their services to help with the project.
"Hospice is a community-focused service for which there is no charge," Mr Moorcroft said.