The next phase of The City’s $1.6 billion Central Subway project is set to begin.

The San Francisco Municipal Transportation Agency is now taking bids for a $210 million project to build the Union Square station, a depot that will be a key connecting point for passengers.

Construction companies have until July 11 to submit a bid, with a decision on the winner coming soon after. Work is expected to begin in 2013 and be completed by 2017.

The station, which has already been designed, will feature entrance points from both Market Street and Union Square.

Major contracting milestones continue to pile up. The SFMTA’s board of directors approved a $233 million pact last year for tunneling work, and bids for the $235 million construction contract for the Chinatown station are due May 8.

A large majority of funding for those projects is expected to come from a $942 million federal grant. While the SFMTA has expressed confidence that it will receive the grant, an announcement of that funding will not be made until later this year.

The Central Subway will extend Metro service 1.7 miles, connecting South of Market with Chinatown.

wreisman@sfexaminer.com