Coastal Ward councillor Simon Illingworth said the town had been crying out for a new toilet block.

"This is long overdue, with the amount of tourists set to come it will really set that area of Port Campbell off," he said.

"The Shipwreck playground is being built, and if that's not enough to make you wet your pants with excitement I don't know what will. I know the kids are really looking forward to it.

"The town will soon be overrun with tourists, we have to get this under way."

Deputy mayor councillor Ruth Gstrein said it wouldn't be any ordinary toilet block.

"This new block will be a feature of Port Campbell, it won't be just any building," she said.

The news was welcomed by Corangamite Shire locals, with one member of the gallery yelling out "it's desperate" at the Tuesday night meeting.

The current loos are located on crown land on the corner of Lord and Morris streets.

Corangamite Shire Council infrastructure project officer Steven Fisher said the upgrades were urgent.

"The existing public toilet facility has been identified as being in urgent need for renewal works," he said.

"The condition is not consistent with modern expectation, is non-compliant to accessible standards and does not meet the current or future demand for the town of Port Campbell."

The tender for the design and construction of the public toilets was awarded to Asco Group Pty Ltd by Corangamite Shire Council on Tuesday night.

Asco's asking price was the lowest of the five tenderers, with the most expensive being $627,843.

"The best value for council is not always necessarily reflected in the lowest price," Mr Fisher said.

The cash will come out of council's capital works budget allocations for 2019-2020.

Temporary toilet facilities will be installed while the demolition works take place.

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