City of Lincoln Council has announced its purchase of a new hotel building currently under construction on Tentercroft Street in the city.
The building is due to be completed later this year when the council will lease it to Travelodge Hotels Limited for 25 years.
The hotel chain will also have the option to extend the lease for a further 25 years.
City of Lincoln Council will invest £13 million in the project and returns will be used to maintain key council services.
The new hotel, which is being developed by York-based S Harrison, will consist of 127 bedrooms, breaking down into 60 double bedrooms, 61 family rooms and six accessible rooms.
Of these, 28 will be ‘super rooms’ which contain a desk, multiple USB and charging points across the room.
The hotel will also have 22 dedicated car parking spaces and the main entrance to the hotel will lead to the reception, breakfast area, café, bar and seating area.
Councillor Ric Metcalfe, Leader of City of Lincoln Council, said: “People are looking to Lincoln more and more as a tourist destination and having a Travelodge in the heart of the city will help meet the demand of budget-conscious visitors.
“This development captures our vision to deliver Lincoln’s ambitious future and such a substantial investment, albeit with considerable rewards, gives out a clear message that the council is doing all it can to help enhance our remarkable city.
“This is a calculated investment which required a carefully considered business case. We are confident it will reap good rewards for council tax payers in an environment where financial support from central government is disappearing.”