The nine-storey building on Union Street in the centre of Aberdeen will include studio and one-bedroom serviced apartments, grouped around internal courtyards. The project is scheduled to be completed in autumn 2016.
The new building will transform the site of a former music shop, which ceased trading several years ago.
Ogilvie Construction managing director Donald MacDonald said: “Our teams have extensive experience in the hotel and leisure sector and the building will be constructed to the highest standard, providing first class accommodation in an excellent location.”
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