It’s the first step in more than $16 million expected to be spent on the Armidale Regional Airport this year.

The expanded terminal will include a new cafe and retail area, baggage carousel, and more passenger seating.

Armidale Regional Council administrator Ian Tiley said he was delighted to see some action on the upgrade.

“Yesterday I signed the contract with Edwards so it's great to see things underway,” he said.

The development will mean 25 fewer car parks for the duration of the construction.

But Dr Tiley said he hoped once it was all finished, that people would see it was worth it.

“There will be some inconvenience, but there is also the new undercover car park and there is further parking to the south on natural ground.”

Northern Tablelands MP Adam Marshall has been a long-term supporter of the airport upgrade.

He said the project was about Armidale coming of age as a regional leader.