Material and labor shortages related to the COVID-19 pandemic, combined with rising interest rates, have delayed breaking ground on a mixed-use development project near East Peoria's City Hall.

But Ty Livingston, East Peoria's director of planning and development, hopes the delay will only last a few months. He said the developer is targeting the groundbreaking for spring 2023.

The development will be named 501 Blutowne and will consist of 230 apartments and approximately 10,000 square feet of commercial space, Livingston said.

The project was initially expected to cost $45 million, but material shortages and interest rate increases have raised the price tag to about $50 million. If construction begins next spring, Livingston anticipates that the project will be completed by the end of 2024. 501 Blutowne will be located along Clock Tower Drive and West Washington Street.

Previous coverage:With construction on luxury apartments starting soon, East Peoria looks to the city's past

“The benefit of getting residential (developments in the Levee District) is that you’re fortifying an investment that’s already been made,” Livingston said. “The Levee District has about $100 million worth of public and private investments between all the buildings and infrastructure that’s been put in. A great way to sustain that is … to have people living here.”

More:Levee District in East Peoria evolved from 'vacant brown space' to thriving destination

This article originally appeared on Pekin Daily Times: $50 million East Peoria development faces setbacks and challenges