Rocco Forte Hotels last week signed a deal to open a hotel in Frankfurt in 2005.
The Villa Speyer, a stately home on Frankfurt's Kennedyallee, was built in 1904. It will be converted into a 166-bedroom hotel and flats. The lease will run for 30 years.
The Fay Group, a German-based property company, bought the site last year and will manage the construction, which will cost more than £38m.
Richard Power, commercial director of the hotel group, said that the deal had taken just two months to complete and had been won in the face of competition from several international hotel companies, including Four Seasons and Ritz-Carlton.
Plans include a hydrotherapy spa and fitness centre, conference facilities for 250 delegates, and an underground car park.
The Villa Speyer was originally the private home of a family of local bankers. Gothic spires damaged during the Second World War will be restored.
Detailed planning applications will be submitted early next year, and building is scheduled to start in 2003 to meet the 2005 opening deadline.