It’s the first of four stages which should eventually see a 500ft pier constructed - less than half the size, but wider than the original structure of 1877, which lasted less than three decades after being hit by a number of ships.
Work should begin on the viewing platform in March, with the aim of opening to the public in the summer. The main contractor will be UK Industrial Services based near Manchester.
Rachel Larsen, of the Withernsea Pier and Promenade Association, said: “It is absolutely fantastic. It is just incredible that we have finally got through to this stage where we can actually sign the contract.
“I thought we would get this stage done, but I didn’t know if it would be this year or next year.
“Everybody that has spoken to us is so pleased for us. It seems incredible that a small organisation like ourselves, who don’t have a lot of experience, has managed to pull this off.”
It comes after Withernsea Big Local said they were increasing their grant offer to £150,000, with an extra £10,000 as a contingency.
A grant from the East Coast Communities fund, donations, and their own fundraising, means they now have the £235,000 needed for the platform.
A marine licence has been obtained and planning permission granted by East Riding Council for the platform, which should be big enough to accommodate people walking up and down, as well as three stalls on either side and benches.
Mrs Larsen said with people unlikely to be able to go abroad this year, they could still come on day trips and holidays to Withernsea and visit the pier.
The fundraising was boosted last year by two surprise donations from wellwishers, including the sister of local resident Paul Lynas, who made a £10,000 donation in his memory.
It also got a £10,000 cash injection from Frank Solomon, who grew up in Withernsea and emigrated to Australia, and wanted to contrribute towards the pier in memory of his father, who was killed in front-line service during the Second World War.
Mrs Larsen’s husband Torkel came up with the idea of building a new pier after chancing upon the original architect’s drawings nearly four years ago.
The final goal is to build a two-storey building at the end, with panoramic views of the sea, demonstrating renewable energy and with a cafe downstairs.
Only two years after the pier was completed a coal barge punched a hole through the middle and another vessel hit the end of the pier.
More than half the pier was destroyed in 1890 when it was struck by a fishing vessel and in 1893 by the Grimsby-bound Henry Parr. All that remains of the pier now are the landward towers, which have been restored.
At the turn of the last century, almost a hundred piers existed but now only half remain.The nearest pier currently is at Saltburn, nearly 140 miles away.
Withernsea Big Local is one of 150 areas across England each awarded £1 million over a 10-year period, to develop resident-led investment programmes “to achieve lasting change”. The funding originates from the National Lottery.