A rendering of the Shangri-La Melbourne, which will occupy part of the Western Tower from 2022.

Construction has begun on a $565 million mixed-use development which will also feature the entry of the luxury Shangri-La Hotels brand into the Victorian capital.

Titled ‘Sapphire on the Gardens’, the dual-tower property is located at 308 Exhibition Street in the CBD. The project was envisaged and designed by S P Setia, while Multiplex has been tasked with bringing it to life.

Local and international dignitaries present at the ground-breaking event included Melbourne Lord Mayor, Sally Capp, Malaysia High Commissioner, H.E. Dato’ Sudha Devi, Shangri-La Asia Limited CEO Mr. Lim Beng Chee, senior executives from S P Setia and Multiplex and iconic Aussie crooner Kamahl, who entertained guests at the event.

Shangri-La Hotel Melbourne will occupy part of the Western Tower, which will measure 62 storeys in height and offer around 500 hotel rooms. An Eastern Tower will be primarily residential, offering over 300 apartments, while both towers will be linked by a bridge at Level 46, which will also feature a SkyLounge overlooking the city, the Royal Exhibition Building and the Carlton Gardens.

The five-star hotel will also sit among Melbourne’s culture and theatre precinct, with Shangri-La Asia Limited CEO Lim Beng Chee saying the strong demand for high-standard accommodation evident in consistently high occupancy rates for the city showed the company it was time to enter Melbourne.

“Shangri-La Hotel, Melbourne will be part of an iconic building complex within walking distance of diverse offerings including vibrant retail and dining hubs, as well as cultural and theatre attractions. We couldn’t have chosen a more strategic and spectacular location to site our hotel and to introduce our Asian-inspired hospitality to all visitors once the complex is completed,” Mr Lim said.

By 2022 when the new development opens to guests, Shangri-La Hotels will have four properties in Australia alongside the long-standing Shangri-La Hotel Sydney, Shangri-La Hotel, The Marina in Cairns and Brisbane’s Hotel Jen, the group’s four-star value brand.

The City of Melbourne said that as construction continues over the next three years, over 1,000 jobs will be generated for the state’s building industry, representing a significant economic boost. Dozens of ongoing operational jobs will also be filled closer to opening date as the hotel opens its doors.