Built on the site of the former Allenton police station, it will be operated by The Birchover Residences. The accommodation will be a mix of nine one-bedroom and three two-bedroom apartments.
Birchover managing director Kieran Howell said: "We have a long-standing fantastic relationship with Rolls Royce and their supply chain. Their guests love to stay with us even though some of our other Derby aparthotels are in the city centre and the northern side of Derby. For a long time we have looked for a site in the south of the city and are delighted to have been offered this opportunity."
Andrew Turner of Stanton Developments said: "We are proud to be developing this brownfield site through a significant investment in a specifically-designed residential scheme for the expanding serviced apartment market in Derby. Since acquiring the site from Derbyshire Police and securing planning approval with Lathams for an imaginative and contemporary building, we immediately identified Birchover as an ideal development partner due to their experience, knowledge and understanding of the local serviced apartment market."
"We firmly believe that a quality apartment hotel in this location, which helps enhance and regenerate the residential neighbourhood, will thrive from the substantial investment in commercial and industrial activity surrounding the Rolls Royce campus," he added.