The BT Tower, one of the most eye-catching structures in the UK, is to become a hotel after it was sold by BT for £275 million.

BT announced the deal in a stock market statement this morning. The tower has been bought by MCR Hotels, an American hotel group whose other sites include the High Line Hotel in New York and the Sheraton hotel in Times Square in the same city.

MCR is going to work with architect Thomas Heatherwick to develop the new hotel. Heatherwick also designed the cauldron for the Olympic flame for London 2012.

The hotel will not open for years because BT has to vacate the tower and remove its technical equipment before any construction work can begin.

The tower was opened in 1965. It was previously known as the Post Office Tower, amongst other names, and used to have a rotating restaurant at the top called Top of the Tower that was operated by Butlins.

The tower closed to the public in 1971. BT has controlled the tower since 1984 and still uses it for events. BT also uses the screen on the outside of the tower to advertise or promote messages.

BT said it was selling the tower because it is no longer needed to distribute telecommunications signals or live television. Microwave aerials were taken off the tower more than 10 years ago and BT can now use its fixed and mobile networks across the country to distribute signals.

The BT Tower is 177 metres or 581-feet high and the property also includes a block at street level. It was the tallest structure in London when it opened in the 1960s.