Whitbread is set to build a 200-bedroom Premier Inn on Manchester's First Street.
The hotel, due for completion in 2021, will be built into the top five floors of a 16-storey mixed-use development, with the lower 11 floors taken up by 160,000 sq ft of office space. The hotel will operate with a separate entrance and lift facilities.
The deal is the second joint venture between Whitbread and Ask Real Estate, which is also bringing forward a planning application to redevelop the nearby Premier Inn Deansgate Locks site. Plans are expected to be lodged in May.
Nicholas Johnston, acquisition manager for northern England at Premier Inn, said: "As a major investor in Manchester we are continually looking at our portfolio of Premier Inn hotels to ensure we are in the best possible locations and provide a consistently high-quality experience for our guests.
"The decision to redevelop the Premier Inn Deansgate Locks site and bring a latest generation Premier Inn hotel to First Street reflects this. Working with ASK Real Estate and its partners, we are able to increase the number of Premier Inn bedrooms in the popular micro-location and bring our latest format to the area. It's an excellent opportunity to improve our portfolio in the city and be part of one of Manchester's most successful business and leisure destinations."
Sir Richard Leese, leader of Manchester City Council, added: "As well as helping to further realise our vision for First Street, we are pleased that this announcement will also lead to the redevelopment of the existing Premier Inn site.
"The ambition to create a cultural hub for Manchester, bringing up to 10,000 jobs to the city, will be further enhanced by this new phase of first-class commercial development."