Park Plaza Hotels has entered into a joint venture with the Reuben Brothers’ investment vehicle Aldersgate Investments to develop a new hotel in the City of London.

The hotel will be launched in Hoxton under the art’otel brand, which is built on a concept of individually-themed boutique hotels, each of which pays homage to a well-known modern artist.

Park Plaza is talking to a number of people in order to identify a well-known artist to be exclusively connected with the hotel. This artist will be involved in the interior design and feel of the hotel throughout the development phase and their artwork will be exhibited at the hotel when it opens.

Boris Ivesha, chief executive of Park Plaza, said: “We are extremely pleased to announce the development of London’s first art’otel. Suitable sites in London to build new hotels are difficult to find, so this is an exciting opportunity for us to purpose build London’s first art’otel that will fully reflect the brand proposition.

“In addition to the attractive location of this new hotel for business travel, the art’otel concept is well suited for this trendy area of London.”

The proposed hotel will likely consist of several hundred rooms and suites and a choice of restaurants and bars, as well as include an art gallery and two auditoriums, which will show cult films and house a photograph studio.

Under the joint venture Park Plaza will pay £3m for 50 per cent of the issued share capital of Aspirations – the company that owns the site on which the hotel is to be developed.

In addition, Apex will advance a loan of approximately £8m to Aspirations, which will be used towards the partial repayment of a loan made to Aspirations by Aldersgate.

It is expected that a planning application will be submitted later this year.