The state held a ceremony Wednesday for starting construction on a $7.3 million technology business incubator building in Kakaako.

The two-story “Entrepreneur’s Sandbox” with 13,500 square feet of work space is being built by local developer Stanford Carr on a state-owned parking lot just Ewa of the University of Hawaii medical school. Completion is expected in July 2019.

A state agency, the Hawaii Technology Development Corp., will operate the facility, which was financed by $3 million from the state Legislature, $3 million from the U.S. Economic Development Administration and $1.3 million from Carr.