A 160 room hotel will be built near Perth's domestic airport to capitalise on the fly-in, fly-out market and provide a fast, cheap solution to the city's hotel room shortage.
The $20 million project will take just three months to build and the first stage will open by June in Ascot, 1.2km from the airport.
Accommodation operator Qube believes its "modular" hotel is the first of its kind in Australia. The hotel modules have been built in China and will be shipped to Perth.
Qube's general manager of sales Lynne Jackson said modular hotels would change the face of the hospitality industry.
"Modular hotels can be up and running in a very short time of three months, giving us the ability to add 162 hotel rooms and 52 residences to the Perth market in the first half of 2013," she said.
Qube was keen to expand into WA's north, where accommodation shortages were acute.
To accommodate the resource industry, the hotel will offer an eight hour rate option, which Australian Hotels Association WA CEO Bradley Woods said would be welcomed by the industry.
"It's a productive model for a hotel to operate in, it will offer specific opportunities for the FIFO market and might also go a long way to alleviating and removing the eyesore of people sleeping in the airport overnight," he said.
Modular construction was becoming increasingly common in Europe and Asia as a quick and cost-effective way to build hotels, offices and apartment complexes, Mr Woods said.
"They are designed to be efficient, simple and comfortable and as long as they meet the relevant building codes and the Australian safety standards, they will offer a cost-effective way of establishing new properties in the Australian market."
Mr Woods said, traditionally, it could take up to three years for a new hotel to be built.
In a separate project, the Qube Aurum Hotel & Residences development near the airport, which has 52 serviced apartments for both short and long-term stays, is due to open in March.
Several new hotels are in the pipeline for the city, including a $16 million riverside serviced apartment complex in Ascot to cater exclusively for FIFO workers.
Last month, construction magnate Len Buckeridge's company BGC was chosen to develop a 300-room hotel on Hay Street to be operated by the international chain Starwood Hotels and Resorts.
Perth has the highest hotel occupancy in Australia (an average of 86 per cent), with few rooms available during the week when business travel is at its peak.
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