A total of 50 staff have already been recruited for the new base, with a further 150 people to be taken on from June.
The professional services firm then hopes to increase its workforce at the site to up to 400 over the next three years - with posts including data gatherers, analysts and managers.
Modern apprentices and graduates will also be recruited alongside more experienced workers.
The creation of the new hub means KPMG has expanded its operations in St Vincent Street, where its tax centre of excellence is already based.
Catherine Burnet, senior partner for KPMG in Scotland, said: “Managed Services will play a key role in the firm’s growth in Scotland.
“We recognise the country has a real depth of talent feeding in from its schools, colleges and universities, as well as an established financial services sector, and we want to harness those as part of our long-term strategy.”
She added: “Managed Services is a relatively new offering and we see significant growth potential as clients across sectors increasingly have to rapidly respond to changes in regulations in areas such as finance, technology, data handling and privacy.
“Additionally, there’s a real demand for bulk data analysis, which enables organisations to make more informed and smarter business decisions in a more efficient manner.
“Managed Services effectively answers those calls by quickly mobilising large teams, using the most appropriate technologies and processes, and combines them with our specialist insight to deliver a cost-effective and quality service.
“Our latest investment follows a strong year in Scotland, where all parts of the practice delivered a positive performance.
“As of the end of our last financial year we had more than 1,050 staff in Scotland and we are committed to growing this figure with the launch of the new hub, alongside wider firm growth.”
KPMG operates from 22 offices across the UK with approximately 16,300 partners and staff.
The UK firm recorded a revenue of £2.338 billion in the year ended 30 September 2018.
It operates in 154 countries and has 200,000 professionals working in member firms around the world.