Lulu Group International purchased Great Scotland Yard, the original headquarters of Metropolitan Police in London for $170m (£110m).
The retail conglomerate purchased the property from British developer Galliard Homes for $15m more than the original asking price of $155m (£100m).
Galliard Homes retains the 125-year head lease on the seven-storey Edwardian property at 1-5 Great Scotland Yard, which it purchased in December 2013.
Lulu Group will refurbish the building and transform it into a 92,000 sq ft five-star hotel, which will be operated by Steigenberger Hotel Group.
Construction work is 30% complete, with interior fit-out scheduled to start in March 2016. The hotel is targeted to open in the first quarter of 2017.
The hotel will comprise an as yet unspecified number of luxury bedrooms, as well as two bars, restaurants, a library, lobby and private meeting, entertaining and dining rooms all with 24/7 concierge service.
An adjoining Grade II Listed Victorian townhouse will be incorporated into the hotel and converted into an entertainment suite.
The hotel will retain the property’s Edwardian Imperial facade, but the interior design will be contemporary and stylish, Arabian Businessreported.
Don 0’Sullivan, managing director of Galliard Homes, said: “Galliard Homes is delighted to have reached an agreement with Lulu Group International to create a bespoke five-star hotel in the heart of London’s Whitehall."