It is next to the Convention Center Exhibit Hall.
The city planned a hotel there a decade ago but the deal fell through. Mayor Lee Brand says the new plan will be a big boost.
"For the city, you are taking a lot that is zero money in tax revenue, you built a 200 room hotel there's a ten, 15, 20-million dollars in property tax, sales tax, room tax, it's a definite benefit to the city," Brand said.
The city originally paid more than three million dollars for the lot. It is selling it for $650,000 and is expected to be a Hilton or Marriot Hotel.
Under the deal, the sale will not be finalized until the builder submits plans and obtains building permits.
The builder has another hotel in North Fresno.