Construction work on the Turner Contemporary gallery in Margate, Kent, has begun but the opening will be delayed until 2011.

The new gallery, designed by architect David Chipperfield, will exhibit contemporary art and celebrates the town's connect with artist JMW Turner, who was schooled in Margate and later lived there. The attraction, which has been in the pipeline for 15 years, was originally expected to open in 2010. Kent-based contractor R Durtnell and Sons is carrying out the construction work.

The £17.4m project has funding contributions from Arts Council England (ACE) (£4.1m), the South East England Development Agency (SEEDA) (£4m) and £6.4m from the Kent County Council. The remaining £2.9m is expected to come from the private sector. The original plans were priced at £7m.

Sally Abbott, director of arts at ACE South East said: "This will be a landmark building representing a huge achievement for artists and arts development in the south east and beyond." The two-storey project will feature 750sq m of gallery space together with an artist's studio and multifunctional space for screenings and other events. A cafe and shop are also among the plans.

Mike Hill, Kent County Council cabinet member for community services, said: "The ACE and SEEDA have been supportive of everything that we are trying to achieve with Turner Contemporary since the outset. These funding agreements demonstrate our partners' confidence in the project and the impact it is going to have on the whole area."