Ranui House provides a home away from home for out-of-town families whose loved ones are undergoing hospital-based medical treatment in Christchurch.
It will soon offer an additional 42 self-contained, two-bedroom apartments for patients and their families, who have to travel to Christchurch for treatment.
The centralisation of specialist health care in Christchurch had increased outpatient care and demand for accommodation.
The Bone Marrow Cancer Trust started fundraising for Ranui Apartments in 2017.
Trust chairman Max Bremner said the $7 million government grant meant construction could begin within two months.
The new apartments would be located on the corner of Waller Tce and Selwyn St, about five minutes walk from Christchurch Hospital.
Ranui House chief executive Yvonne Simes said it was difficult to keep up with patient requests at the moment. The new apartments would help.
Simes said Ranui House and eventually Ranui Aprtments relieved some of the stress for patients and their families, because everything apart from food and personal toiletries was provided.
"Because they can bring their family with them, it also helps the patient's recovery if they require a long-term stay," she said.