Ennismore, owner of the famous Perthshire estate and golf resort, will take over two empty premises at St Andrew Square with the 33-bedroom Gleneagles Hotel.
A bronze rear extension called the garden pavilion will be constructed as well as a new rooftop terrace for members, subject to approval from the City of Edinburgh Council.
The former Bank of Scotland premises next to Dundas House, which closed its doors in 2016, will be transformed into Gleneagles’ new venture.
The company is also pushing forward plans for a new sister hotel in the Mayfair area of London.
The projects are the first expansion in the brand’s 94-year history - labelled a “landmark moment for the business”.
Ennismore’s vision for the Edinburgh project will provide a mix of seasonal Scottish dining, luxury hotel rooms, private meeting and event spaces along with bars that “celebrate the best of Scotland’s whisky”.
Developers hope the two sister hotels in Edinburgh and London will “allow Gleneagles to look after its already loyal guests more frequently” as well as introduce “new global audiences” to the iconic Scottish brand.
A spokesman from Ennismore said: “We have worked hard with the council and partners to ensure that one of the city’s finest listed buildings is preserved and restored sensitively to create a fantastic new hotel and dining experience.
“We believe this will further enhance Edinburgh’s range of high quality hospitality and leisure offering line with the aspirations of both the council and Marketing Edinburgh.”
The developers have also applied for permission to build a full-width, recessed roof extension with an external terrace on the front section of the building – which will sit behind the building’s prominent statues.
To the rear of the two properties, a modern single storey and basement structure will be built, containing bedrooms, dining and kitchen spaces.
The extension will be finished in bronze cladding panels with metal-framed windows.
Both buildings at St Andrew Square date back to the late 18th century. When the larger building was completed, it was the most prominent building on the east side of St Andrew Square until the mid 20th century.
The vision has been welcomed by council leader Cllr Adam McVey, who said the plans demonstrated Edinburgh’s attraction as a destination.
He said: “Gleneagles is a fantastic Scottish business and by expanding into Edinburgh they’re giving a strong vote of confidence to the hospitality market in the Capital.
“Having visited the development, the proposals being put forward are a strong addition to the city’s offering and bring a vibrant use back to another building on St Andrew Square which is the focus of a number of exciting ongoing developments.
“While we won’t know the final decision of the planning application until the planning committee considers the application in full on Wednesday, it’s encouraging to see Edinburgh continuing to attract investments on this scale.”
Gleneagles is following the likes of The Ivy and Dishoom in choosing St Andrew Square as a high-end destination in the Capital – while the Edinburgh Grand luxury apartments are available next to the new hotel. Proposals have also been lodged with planners for a concert hall, the Impact Centre, to the rear of Dundas House. The eastern end of the city centre is undergoing an overhaul – with construction of the new St James Centre also well underway.
The arrival of the Gleneagles Hotel will be another welcome boost to Edinburgh’s hospitality and tourism industries.
John Donnelly, chief executive at Marketing Edinburgh, said: “The Gleneagles name is known globally for its first-class hospitality, so the addition of the club hotel at St Andrew Square would be yet another premium asset for Edinburgh.”