The authority's leader Ian Brookfield said discussions had taken place with a "top operator" over opening a hotel.
He said number of potential city centre sites are being looked at, one of which would form part of the Westside development.
Mr Brookfield has also revealed that a deal was imminent for up to 300 staff from the Ministry of Housing, Communities and Local Government (MHCLG) to take over two floors of the i9 building in the city centre.
It came as Mr Brookfield outlined his plans for the city over the coming year, which also include a jobs drive and the start of a scheme to retrofit thousands of homes to make them more energy efficient.
He said Covid had pushed back developments but that the council was determined to get things back on track as quickly as possible.
On plans for the hotel, he said: "We are in active discussions with a major international brand for what will be a fantastic development for the city."
He said talks with the MHCLG over i9 were "really advanced". "They love the site and its positioning, and are looking at taking a couple of floors," he said.
"We can't be more than a week or two away from the signatures and the finances being done."
Mr Brookfield said the move would be a major boost for local jobs.
"We believe that not many civil servants wanted to move out of London, which leaves hundreds of jobs for local people here.
"If you look on the job sites now there are already dozens and dozens of adverts for Wolverhampton-based MHCLG staff. They are recruiting now."
He said the Government wanted to occupy the building by late July, early August.
Meanwhile Mr Brookfield has appointed Bilston East councillor Steve Simkins as his new deputy leader. He takes over from Louise Miles, who lost her seat at last week's elections.