The Jockey Club investment will include improvements for owners and trainers and new Royal Box facilities.
Over the last 10 years The Jockey Club has invested more than £155m in new grandstands and upgrades across its racecourse estate including £31m on two new grandstands at Aintree and £28m on the Epsom Downs grandstand.
Subject to planning approval, construction will begin immediately after the 2014 Festival with a scheduled completion date ahead of the 2016 Festival.
Lead project manager on the project is EC Harris, while the architect is Gloucester-based Roberts Limbrick, which has worked regularly on Cheltenham’s various upgrades along with other projects in the Jockey Club’s 15-course estate.
Paul Fisher, group managing director of Jockey Club Racecourses, said: “Cheltenham Racecourse is not only one of The Jockey Club’s crown jewels, we recognise it is the home of Jump racing and one of the great theatres in British sport.
“It is vital we continue to invest in its appeal, the experience it offers and its success, for the good of British racing.”
He added: “The Jockey Club Board commissioned a feasibility study into the proposed development at Cheltenham.
“With that completed and having now been presented with a robust business plan, a range of financing options and a carefully tested design, they had no hesitation in approving the project.”
Plans will be submitted to Cheltenham Borough Council this month.