The development, which will give the town new community and enterprise facilities, was granted planning permission in October.
Peter Hirst, chair of Hebden Bridge Community Association, said: "We're absolutely thrilled to be able at last to press the button for go. This is the culmination of months and months of detailed planning work and fund-raising.
"The new buildings together with the newly created riverside courtyard will, we believe, give the town fantastic new facilities for very many years to come."
Detailed work on the interior finish is now being undertaken by the association's architects.
Mr Hirst said: "By this time next year the building should be close to completion. We are aiming to have everything in place for a grand opening in the spring of 2012."
The development includes a riverside hall, a new club room for the local light opera and youth theatre groups, meeting rooms and enterprise units.
The plans also include a new public open space by the river Hebden.