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The project also involves building a new four-cubicle toilet facility.
Queenstown Lakes District Council community services manager Thunes Cloete said the plan's aim was to reduce the amount of car parking space on the lakefront and provide better access for pedestrians and cyclists.
The new car park would help towards that by providing alternative parking near the foreshore, he said.
The car park was expected to cost about $800,000 and was planned to be completed by Christmas.