The Lancaster-based business has bought the iconic grade 2 listed former mill in Moor Lane, which is next to the Lancaster Canal and the proposed canal quarter development site.
The property, known as Mill Hall, has been bought directly from the University of Cumbria and will house 78 students once finished.
It will now undergo "a significant refurbishment to bring the property up to the luxury standard associated with the UniPad brand".
A Unipad spokesman said: "Our multi-million pound investment in the property will ensure it will become a much sought after residence for students studying in Lancaster in the future.
"Our first units will be available to book from October 2021. Available units will be listed on our website in the coming weeks.
"The property has a lot of history and is a landmark in Lancaster. It’s been purchased from the University of Cumbria, who felt we were the correct custodians to take over the property.”
The newly developed building will include all en-suite rooms, a fully-equipped gym and games rooms for residents.
Unipad is based in King Street and has been offering student housing in Lancaster since 2008. It is registered on Companies House as having Anas Mister as its director.
This latest investment follows Unipad's completion of a luxury student development in North Road next to Flames takeaway, which is a mixture of en-suite bedrooms and studio apartments.