High-rise buildings will be knocked down in the Sydney CBD to make way for a major underground interchange at Martin Place for the Sydney Metro.

The New South Wales Government has unveiled the Environmental Impact Statement for the next stage of the project, which includes 15.5 kilometres of rail tunnels from Chatswood to Sydenham.

The tunnels will dip 40 metres below the surface of Sydney Harbour as they make their way to stations including Barangaroo, Martin Place, Pitt Street, and Waterloo.

Transport Minister Andrew Constance said high-rise buildings on two sites at Martin Place and Castlereagh Street would be levelled to provide access for underground construction.

Those sites would then become entrance points to the interchange.

"This is going to be like keyhole surgery here in the centre of Sydney," Mr Constance said.

"It's a project which is largely underground, causing minimal disruption.

"We won't see the type of extensive disruption we've seen with the light rail because of the very nature of the project."

Sorry, this video has expired Sydney Metro CBD construction

Most properties for acquisition are commercial

All up, 150 homes and businesses in 70 buildings along the route will have to be acquired, but Mr Constance said only a minority were residential properties.

"It's mostly commercial, it's in the centre of town," Mr Constance said.

He said the Government had already purchased some properties, but was still in the midst of negotiations on others.

Mr Constance said all property owners had been notified, but would not say how much the Government was willing to pay for buildings.

Premier Mike Baird acknowledged that the cost of the project had risen from its previous price tag of $11 billion, but said that was because more stations had now been planned.

"The expectation on the project now is between $11.5 and $12.5 billion, that includes the additional cost that comes with the additional stations," Mr Baird said.

"But I think that's the right thing for the city, the right thing for the project."

Mr Baird said the final cost of the project would be released with the final business case.

Work will start next year at Martin Place with a massive cavern to be excavated underground for the interchange.

Tunnel boring machines will begin in 2018.