Medlock FRB Ltd from Oldham has started building work on a new 84-bed hotel and Brewers Fayre pub restaurant off Congregational Way near New Square shopping centre West Bromwich B70
The site, next to the Tesco fuel station, has been empty since building work on New Square was completed around five years ago.
It will be based close to Providence Place which is home to the West Brom Building Society headquarters and BT call centre.
Groundworks have now started with officials from Whitbread, which runs the Premier Inn brand, saying they hope the hotel will be open February 2019.
There are already two Premier Inn hotels in the town - one based off the High Street at the West Plaza building and a second next to the Ridgacre pub off New Gas Street.
Whitbread project and programme manager, Matt Gent, who is leading the scheme, said: “Construction is progressing well at Congregation Way.
"Our building contractors started work on the site in early April and though it is early days, we are on track to have our new 84-bedroom Premier Inn and Brewers Fayre open by the end of February next year.
"Congregation Way is an excellent location for a new Premier Inn and Brewer Fayre.
"The site is in a prominent location to the town centre, it has excellent transport links and once we are open, the hotel and restaurant will create new jobs and help to support the success of New Square.
"It’s an exciting time for us and I’m looking forward to progressing the build over the summer.”
Mr Burr added: "It’s an exciting time for West Bromwich with work beginning on this new hotel.
"Since New Square opened its doors nearly five years ago, we’ve seen some fantastic commercial development locally and this latest arrival will only further bolster the area’s economic strength."