About 40 firefighters tackled the blaze which destroyed the African Village restaurant, formerly the Crown and Cushion pub, on Birchfield Road in Perry Barr yesterday.
Firefighters used a ladder to rescue one man from a first-floor window of the premises while another person managed to escape unaided, a fire service spokesman said.
WATCH: Video shows footage of the blaze
Eight fire engines were sent to the scene to tackle the blaze, which spread to about 80 per cent of the building in less than an hour, the fire service spokesman said.
The fire was fully extinguished overnight and is believed to have started accidentally, although inquiries were continuing this morning.
The site, on the corner of the A34 Birchfield Road and Wellington Road, is less than 200 metres from the the old campus of Birmingham City University which is being transformed into the 2022 Commonwealth Games athletes village.
African Village had already been earmarked for demolition when an application was made to tear it down and build an eight-storey apartment block for 95 homes in its place late in 2018.
A previous plan to build 55 apartments on the car park next to the restaurant was turned down by the city council after concerns that the venue, which is allowed to host live music, would be too noisy for the new residents.
Additional firefighters were sent to the scene in north Birmingham after videos of the blaze were sent to the fire service before the first crews arrived at around 4pm, the spokesman said.
Birchfield Road and Wellington Road were closed due to the blaze, causing major disruption for drivers in the area throughout the evening.
In July 2019, the African Village restaurant was banned from serving food to customers with food allergies after one diner ended up in hospital.