Work on a 464-room hotel at Melbourne Airport has begun.

The first sod on the new $163 million hotel was turned last week. Melbourne Airport chief of property Linc Horton said it’s the latest step in supporting Melbourne to become the country’s biggest city.

“It is really exciting to bring such a great new hotel concept to one of the great travel destinations in Australia – Melbourne, giving travellers more choice and amenity,” Mr Horton said.

“We believe this new development will bring a much-needed social hub to our space bringing visitors and business colleagues together on the doorstep of the airport with access to more than 650 flights per day.”

The hotel will be located near Terminal 4 in a new precinct to be called The Hive.

The 10-storey hotel will boast a gym and pool facilities, a café, bar and restaurant, and conference room facilities.

The hotel is the first major development to kick-start the airport’s Hive precinct, which will also feature a childcare facility, to cater for children of the airport’s 20,000-strong workforce, as well as office space ranging from 1000 to 10,000 square metres.

Mr Horton said 120 job opportunities will be created when the hotel opens.

Accor Pacific chief operating officer Simon McGrath said the hotel will perfectly compliment the location.

“With more than 650 flights in and out of Melbourne Airport every day, we’re confident that this hotel will quickly become a new destination in itself for passengers, offering … accommodation, amenities and conferencing, just steps away from Terminal 4,” Mr McGrath said.

The hotel is scheduled to open in 2021.