Earlier estimates put the cost of the building next to the Otago Harbour slipway at more than $12 million.
However, a report in the agenda for Wednesday's council meeting showed the council's quantity surveyor, Davis Langdon Shipton Davies, estimated the cost for the building, based on the preliminary design, would be $18 million.
The report estimates a further $9.6 million will be needed for the public amenity, site, fees and the project and design contingency.
Mr Martin said funding for the combined new building and public amenity project would come from asset replacement reserves, the sale of existing premises, special dividends, plus special and general reserves.
There would be ''rental streams'' from commercial clients on the ground floor and there was also provision for expansion at a later date, which could also generate income.
''Further detailed work on a funding regime will be undertaken when detailed design and costings have been undertaken.
''However, no external borrowing is proposed, and the rating impact effects are not anticipated to be significant,'' he said.
Estimates for the projected ORC building cost equated to $3517 a square metre.
The quantity surveyor provided direct comparisons with other significant projects, such as the Meridian Office Building in Wellington ($4315/sq m) and the NZi3 ICT Innovation Building in Christchurch ($3900/sq m).
The report said estimates would continue to be refined through the next stage of the design process, with potential savings identified as the project proceeded.
The council has approved the demolition of the existing buildings on the wharf, and tenders have been called. Demolition is expected to start at the end of this month.
However, discussions are continuing with Port Otago and the Kitchener St slipway licence-holder on developing an operational plan for the site, which has caused concerns for some maritime companies.
Despite the estimated cost increase, Dunedin Ratepayers and Householders Association chairman Syd Adie supported the project.
''This is a pittance compared to what the Dunedin City Council are going to spend on a new stadium. The [city] council don't even know if they are going to have a tenant.
''We can see better amenities at the harbour basin and the ratepayers are not losing any recreation areas.''
On Wednesday, councillors will be asked to endorse the development of the preliminary design to a detailed design for the council's approval.
Tenders will then be called.
