Prime Investors Capital (PIC) has secured approval from Westminster City Council in the UK to redevelop the Admiralty Arch building in London into a mixed-use building.
Under the plan, the Admiralty Arch building will be turned into a 100-bedroom hotel, a private members club and one 1,566m² flat with a separate entrance.
Plans also include a spa, three restaurants, a 25m pool and a brasserie on the first bridging floor over the Sovereign Arch with views of the Mall and Buckingham Place to the west.
As part of the lease agreement, the developer will make a £600,000 contribution towards the council's affordable housing fund as well as £100,000 towards public art.
Designed by Aston Webb, Admiralty Arch was built by John Mowlem & Co and was completed in 1912.
The building was originally designed as a ceremonial passage from Trafalgar Square to Buckingham Palace.
The facility, which underwent refurbishment in 2000, has recently been occupied by the Cabinet Office.
The Cabinet Office said that the plans were part of a strategy to operate a more efficient Government estate.
It said the 99-year lease agreement signed between HM Government and PIC in October 2012 will raise an additional £60m from the sale of Admiralty Arch's leasehold.
Cabinet Office Minister Francis Maude said the approved plans will transform Admiralty Arch's unsuitable office space into a publicly accessible landmark.
"Retaining the building's freehold will mean that the public will always have a say in its future and this restoration project will create jobs, boost the local economy and help reduce the deficit," Maude said.
Construction is expected to start in early 2014 while the hotel is planned to open in 2016.
The redevelopment plans were designed by Blair Associates Architecture, which also undertook the restoration of Claridge's and the Connaught hotel.
Image: Admiralty Arch in London, England, viewed from the Mall facing north-east. Photo: Photo by DAVID ILIFF. License: CC-BY-SA 3.0.