The national hotel chain Travelodge has written to Shetland Islands Council to propose a new hotel in Lerwick.
Shetland is one of 20 areas identified by the firm, as the chain looks to expand across Scotland.
According to Travelodge, they have written to the SIC to propose a “joint development partnership” to finance a new hotel in Shetland, which they claim will unlock “development potential in the isles”.
But the council’s communications department said that the authority could not yet comment on the proposals because the letter had not arrived.
The firm announced plans for expansion on Monday as its newest hotel, located in Stirling city centre, opened.
Travelodge’s plans have seen them write to 20 local authorities across Scotland, with Kirkwall in Orkney also on the firm’s radar.
If successful the company claims the expansion will represent an investment of £125 million and could create 385 new jobs.
According to the chain, the letter to the SIC outlines how it has worked alongside 12 local authorities in England and Wales to create jobs and boost the economy.
Travelodge believes it can do the same for Shetland, which it has identified as an “up-and-coming tourist destination”, and in doing so help the council to achieve its aims of increasing visitor numbers.
Agreements between the hotel chain and local authorities have had unique funding structures, Travelodge said. Hotels have been built on surplus local authority land, with funding provided either through internal council resources, the Public Works Loan Board or third-party resources.
Upon completion, local authorities can choose to either retain ownership of the hotel, receiving an annual rent, or sell the hotel with Travelodge as its operator.
Travelodge chairman Brian Wallace said: “Many local authorities are in possession of large amounts of property and assets that are not being utilised. Investing in a low-cost hotel like Travelodge is an increasingly attractive choice, as it draws visitors, creates jobs and helps boost the local economy.”
He added: “We want to extend our Scottish network with a further 20 hotels and this includes our first hotel in Lerwick. To help us achieve this, we are writing to Shetland Islands Council, to invite them to consider how Travelodge can act as a catalyst to drive their local development agenda.”