The Canadian-based Sandman Hotel Group will establish its first hotel in Scotland at the site of the former Robert Gordon University campus on St Andrews Street.
The firm will invest more than £20m to transform the building into a hotel and it is estimated that 80 new jobs will be created during construction, with a further 150 in hotel and restaurant operations.
Alex Salmond, Scotland’s First Minister, said: "While this new hotel will undoubtedly benefit business tourism in the Aberdeen area, visitor numbers from overseas markets continue to grow. The Sandman Hotel Group has seen the golden opportunity Scotland presents and I’m delighted to see them investing upward of £20m in their new Aberdeen city centre hotel. This year of Homecoming will see the eyes of the world on Scotland as we host the Commonwealth Games, Ryder Cup and the MTV Europe Music Awards – not to mention the Scottish Open this week here at Royal Aberdeen."
The building will be transformed into a premium hotel complex with 220 rooms, including 61 one-bedroom suites, a restaurant, and convention facilities.
Taj Kassam, president of Sandman Hotel Group and The Sutton Place Hotels said: "We are thrilled to open our first hotel in Scotland and partner with RGU. Our brand of hospitality fits perfectly into the iconic city of Aberdeen."
Lindsay Brown from VisitScotland’s Business Tourism team added that the investment is excellent news for Aberdeen and adds to the already excellent range of conference facilities and accommodation on offer in the city.