Demolition of the tavern block east of City Hall began in earnest Wednesday as workers began to knock down the sagging row of defunct watering holes.

Developer Jeff Oliphant will replace the block by fall or winter with a 68,000-square foot, three-story building to include a City Hall annex and KeyBank branch.

The main floor will open onto East Main Street and First Street Northeast, offering retail and office space.

At more than 25,300 square feet, the City Hall Annex, an answer to the city’s need for additional space, will take up roughly half the second floor. A second-story sky bridge over North Division Street will connect the steel-girded, brick-faced building to City Hall. The third floor will offer professional and medical offices.

City employees will park at the garage that Auburn Regional Medical Center is now building north of City Hall. The city and the hospital have agreed to share the garage.

KeyBank’s new ground-floor, branch office on the corner of East Main Street and Auburn Avenue will anchor the building on the east, replacing the longtime branch at nearby 15 Auburn Avenue. Parking will be available for customers from a new lot adjacent to the entry door to the new branch.

Oliphant, president of Auburn Professional Plaza LLC, was responsible for the earlier remodel of the old Massey’s grocery store building – later the Family Fun Center – on East Main into the Auburn Justice Center, which now houses the Auburn Municipal Court and the Auburn Police Department.

The primary contractor is Sierra Construction Company.