The parishioners of Wollongong's St Michael's Cathedral have spent 20 years trying to lease part of their church property to pay for costly repair work and raise funds for ministry.

Now they will achieve their vision " in the form of an international hotel.

"The hotel development will help us at the Cathedral maintain our buildings properly," says Canon Sandy Grant, "without having to divert offertories away from gospel ministry expenses."

The parish has joined with French-based hotel group Accor to build an Ibis hotel on land owned by the church.

The three and a half star hotel is expected to generate ongoing funds to preserve the Cathedral,  one of Wollongong's most historic landmarks.

Tourism chiefs have welcomed a proposal they believe will breathe new life into the city.

St Michael's was built in 1859 to a design by noted colonial architect Edmund Blacket.

A recent conservation management plan estimated the parish would need to spend over $30,000 per annum to maintain the building to National Trust standards.

Bishop of Wollongong Reg Piper said he was right behind the plans for St Michael's.

"This is an important building for the Anglican Church and for the City of Wollongong and this is a sound and sensible way to preserve it."

Assistant to the Bishop, Geoff Kyngdon, said after 20 years of seeking a use for the land, the Accor hotel has been the first viable option.

The proposed hotel would have four floors of accommodation with around 150 rooms and a floor for a family-style restaurant.

Because the hotel is to be built on church property, it would not have bars or nightclubs.

Comment on this article for the next issue of Southern Cross