Construction of residential developer Toga's $200-million mixed-use precinct in Sydney’s Surry Hills, which will include a revitalisation of the current shopping village, has begun with demolition now under way.

The project will feature 122 high-end apartments across three buildings as well as a 102-room boutique hotel that will include a rooftop pool and bar, with access to ground floor retail.

The mixed-use project will also provide up to 12,000sq m of retail and commercial space.The development, which will span a 1.2ha, will be supported by a new 517sq m public park.

The project also includes the adaptive reuse of the heritage-listed and under-utilised former Bank of NSW building on Cleveland Street.

The heritage facades of the buildings will remain, but there will be extensive internal modifications to create large office floor plates and one new storey and a mezzanine level added to each building.

“As Surry Hills locals, the SJB team are hugely passionate about this significant project and the opportunity it presents for the neighbourhood,” SJB Architects director Adam Haddow said.

“Paying homage to the history of the site and building, while ensuring a blend of retail, residential, hotel and commercial space that feels at one with the street environment was a priority.”

Toga will also build a public pedestrian thoroughfare linking Marriott Street and Baptist Street.

The project marks a return to the suburb for Toga, which developed, and now operates, the Crown Street Women’s Hospital into the Adina Apartment Hotel in 1994.

“Since developing the old Crown Street Women’s Hospital we have always considered ourselves as a long-term partner in this community,” Toga managing director Allan Vidor said.

“Important to our vision is the legacy we create and leave for the communities in which we develop, and we see that Surry Hills Village will be a place that people can live, work, stay and visit for many years to come.”

Last year, Toga completed The Hunter, a boutique development of 13 apartments in the heart of Double Bay.

The developer also has rehashed plans for a $114-million development in Penrith, set to comprise a five-storey commercial podium with 356 apartments across two 14-storey and 38-storey residential towers.