The federal government inked a formal agreement Friday to chip into the Ottawa Congress Centre's ongoing redevelopment.

Using the Building Canada Fund, the government will provide up to $50 million to contribute to one-third of the cost of redevelopment. The rest will be picked up by the provincial government, the City of Ottawa and the private sector.

Total costs of the project are slated at $166 million.

"The redevelopment of the Ottawa Congress Centre will boost economic growth in the National Capital Region, and is expected to bring in more than $100 million per year in retail, hotel, restaurant and transportation spending," said environment minister John Baird in a statement.

"This government believes an investment in a new convention facility is well worth the economic, as well as cultural, benefits this region will enjoy."

Demolition is set to begin in October once the centre chooses a project manager. The competition is between EllisDon Corporation and Parkin Architects, or PCL Constructors Inc. and Brisbin Brook Beynon Architects.

The two companies submitted their bids on Aug. 28, and OCC board chair Jim Durrell said in the release that he was impressed by their vision for the centre.

The Building Canada Fund is a $33-billion initiative to boost infrastructure across the country.