Work has begun on a flagship development for Barrow's waterfront, which it is hoped will be open for tenants early next year.

Thomas Armstrong Construction, based in Flimby near Maryport, began work this week on a two-storey “gateway” office building at the Waterfront Business Park on Barrow Island.

The £3.5 million project is situated on Harding Rise, a new area of the redeveloped docklands, accessed off Ramsden Dock Road.

It has been part funded by European regional development funds totalling £2.3m with the rest being met by Barrow Borough Council, which will charge rents to recoup its investment.

Stuart Klosinski, programme and project manager for Furness Economic Development Forum, said the new building would have 16,000 sq ft of space catering for around 28 separate business units.

He hoped construction would be complete by Christmas and businesses would be able to move into the building as early as January.

"It's a major milestone for the waterfront as it's the first building going up on the northern part of it," he said.

"It will act as a catalyst for other developer interests and cater for small and medium sized enterprises in the supply chain to anything in the Furness area, including windfarms, nuclear and energy."

Thomas Armstrong's tender for the work had come in slightly below the original costings, he said, meaning it should represent "good value for money".

The development will add to office space already available at sites such as the town's Phoenix and Trinity business centres to meet the growing demand, he said.

"We have already got a couple of companies who are tentatively interested and over the coming weeks we will be looking to refresh the marketing (of the project)," he said.

"At the start of January there will be the opportunity for people to move in, which will coincide with the increased economic activity in the Furness area."

He hoped the new development may become part of an "advanced manufacturing and innovation district" for the area.

"We are in discussions with the Department of Business and the Cumbria Local Enterprise Partnership to take that forward," he said.

He also hoped the development would act as a boost for Barrow Island, creating job opportunities for local people and for local schools to engage with businesses.