Shisha Point, in Sunbeam Street, Blakenhall, had previously applied to the city council for permission to trade, after a period operating unlawfully.
An earlier hearing had been adjourned to enable members of the council’s statutory licensing sub-committee to conduct a site visit after a number discrepancies were raised.
The premises is open to people aged over 18 and allows patrons to smoke shisha – flavoured/fruit tobacco made from molasses – from a hookah, more commonly known as a waterpipe.
Smoking is restricted to an outside balcony at the venue, which is part of Yadia Nights restaurant and bar.
The committee earlier heard from local resident Gary Wood, Councillor Paul Birch and West Midlands fire safety officer Neil Aston-Baugh.
Mr Wood raised concerns over traffic and parking in the street outside the premises and Mr Aston-Baugh said a number of fire safety issues had previously been identified. Bar owner and applicant Mohammed Ali told members these had now been addressed.
Councillor Birch said he felt that the location of such a facility was unsuitable as it was in the middle of an industrial estate.
Chairman Councillor Phil Page said members had listened to and considered all the representations made and that it was the committee’s decision to grant the licence.