THE West Australian Government this week announced it has shortlisted three major companies for the construction of the Perth Waterfront inlet and public spaces.

Planning Minister John Day said that after a rigorous assessment process, Leighton/Broad, John Holland and a consortium involving Brookfield Multiplex and Georgiou have each been successful in their initial bids for the major works contract worth $200 million.

"The three shortlisted groups are all suitably experienced and qualified contractors and were selected for the high quality of their submissions and comprehensive understanding of the Perth Waterfront project," Mr Day said.

"This is a significant milestone in delivery of the project which is well under way and is on schedule - major work is due to commence in the coming months."

The Minister said the contract was worth an estimated $200 million and included construction of the new inlet, the creation of future development sites, new internal roads and the delivery of high-quality public spaces including parks, promenades and an island with a connecting bridge.

The winning developer is expected to be announced in March, with works to begin soon after in April.

"Perth Waterfront is part of the State Government's city regeneration program and, together with Perth City Link, Riverside and revitalisation of the Perth Cultural Centre, will help to position Perth as a contemporary, international city," he said.

"A 2.8ha inlet will bring the city to the river and create a magnificent destination for locals and visitors surrounded by landscaped terraces, boardwalks, shops, cafes, restaurants, bars and other activities."

The Perth Waterfront project aims to transform the city by reconnecting it with the Swan River and all public works are expected to be completed by mid-2015, with private development to continue after this time.

Ultimately, the government expects the 10 hectare site will contain 1,700 apartments, 150,000 square metres of office space and 39,000 square metres of retail space. This private sector construction is expected to commence in stages from 2013 to 2022.