Nearly a year after a three-alarm fire caused hundreds of thousands of dollars in damage to a Port Orchard icon,  renovation is underway at Myhre’s Restaurant on Bay Street.

Bad Board Restoration and Construction Services began the demolition phase a few weeks ago, said Troy Slayton, the owner of Bad Board. The building, located at 739 Bay St., will again be home to Myhre’s restaurant downstairs. Five one-bedroom apartments upstairs, will be built upstairs, he said.

Myhre’s Restaurant was gutted by fire July 1. The restaurant closed for the first time since 1963, when a fire destroyed the 1923-built original Myhre’s.

Renovating the building and reopening Myhre’s has been a slow process, Slayton said. Going through the expansive, waterfront space and recognizing what needed to be rebuilt took time.

“When the fire hit, it really torched the top of the building,” he said. “A lot of the steel has to go into the building.”

After demolition, Slayton said the crew will begin work on constructing the roof. He said the downstairs portion with the restaurant should be finished in eight months and expects the apartments to be completed sometime in 2013.

Port Orchard’s Planning Director James Weaver said Myhre’s had only received permits to gut the building and replace the roof. No permits for any interior work, apartments, or other proposed construction had been submitted to the department, he said.

The owners of the building and Myhre’s Restaurant, John Lora and Mindy Oliver, were not available for comment.

Slayton said the the space will be a beautiful building once construction is completed. The specifics on the interior of the building are not finished, but the downstairs is expected to have a newer, more open restaurant space, he said.

The upstairs apartments come in at about 1250 square-feet each. The apartments will have sliding glass doors and windows, with a few Sinclair Inlet views.

“It’s going to be be a very nice building when we are done,” he said.