US-based luxury boutique hotel company 21c Museum Hotels has started work on the restoration of the Metropole building in downtown Cincinnati as part of a $50m project.

The property will be transformed into a boutique hotel offering 160 rooms, an art museum, a restaurant, a rooftop bar and a spa.

The hotel, designed by Deborah Berke & Partners Architects, will be built by Messer Construction as part of an 18-month project.

The hotel is expected to open in 2012 and has been funded by a traditional construction loan, state and federal historic and new market tax credits, a $2.5m funding and property tax increment programme from the City of Cincinnati, a $6m loan from the Cincinnati New Markets Fund and a loan from the Build Cincinnati Development Fund.