A new 250-room hotel has been planned for a car park section next to the plush Crowne Plaza Hotel in Canberra's city centre.
The hotel, which will carry the Holiday Inn Express brand, will be developed by the SB&G; Hotel Group, a Melbourne-based property firm that also owns the Crowne Plaza.
It is estimated the new development would cost about $50 million and would open in 2021, the SB&G; Group said.
It is the latest hotel to be planned for the district surrounding Glebe Park, with the company behind Canberra Casino also signalling their intent to build in the area.
Hong Kong-based Aquis Entertainment said in 2015 that it would two hotels on the casino section backing on to Glebe Park, one a 100-suite five star hotel, the other a six-star 12-storey tower.
A spokesman for Aquis did not respond to questions on whether the Holiday Inn announcement had any impact on the casino's hotel plans.
SB&G; managing director Paul Salter said the new hotel would look to plug gaps in the territory's midscale accomodation market.
"We saw an opportunity to bring a differentiated hotel offering to the Canberra market," he said.
"While the Canberra market has been strong over recent years, the majority of hotel supply that is planned is upscale, with the midscale market remaining under-serviced."
The development would not have any effect on the neighbouring Crowne Plaza Hotel.
"The new hotel - Holiday Inn Express - will be built adjacent to the Crowne Plaza," an SB&G; spokeswoman said.
"There is a car park currently in the space where it will be built."
Leanne Harwood from the InterContinental Hotels Group said the new Holiday Inn would offer a simple and streamlined service.
"With faster check in and breakfast for everyone, Holiday Inn Express gives guests a simple, engaging place to recharge and get a little work done," she said.
"We think it's a great fit for Canberra's savvy traveller."
Developers have set their sights on the downtown precinct near Glebe Park in recent years.
Last year Aquis chief executive Jessica Mellor outlined a grand plan to revitalise the area as part of a revamp of the casino.
The Aquis proposal included six-star villa accommodation and a five-star hotel, seven new restaurants, a night club and bars, a luxury brand shopping mall, and a day spa.
The casino's plans also included a new entrance that opened on to Glebe Park, including a piece of land bought by the government in 2014.