The Mayfair Hotel will be demolished and replaced by 201 flats.
Permission has been given to pull down the hotel on St Saviour's Road.
Dandara will build the one and two-bedroom apartments for Andium Homes.
The hotel is closing at the end of October after more than 50 years of welcoming guests.
Owners, the Modern Hotel Group, said the continual challenges facing tourism, coupled with the impact of Covid-19, had made it increasingly difficult to operate.
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