The demolition of a building at the northern end of Memorial Drive does not mean the road's long-awaited link to Bulli Pass is moving ahead, the NSW government says.
Heavy equipment was on site yesterday morning knocking down the walls of the former Ocean View Temperance Hotel on the Princes Highway at Bulli.
A Roads and Maritime Services spokeswoman said the demolition was to save money.
"Roads and Maritime Services demolished the buildings at 300 Princes Highway Bulli to avoid the unnecessary expenditure of public money on maintaining a dilapidated building.
"Since 2010 the buildings on the property have been broken into and vandalised on three occasions."
The spokeswoman said the RMS was looking at the possibility of linking Memorial Drive with Bulli Pass.
"The NSW government is funding strategic planning investigations," she said.
"A corridor of land between the Bulli Pass hairpin bend and the northern end of Memorial Drive at Bulli has been zoned as road reservation on the Wollongong City Council Local Environment Plan 2009.
"There is also a long-standing road corridor between Lawrence Hargrave Drive at the bottom of Bulli Pass and the northern end of Memorial Drive."