Chairman Khaldoon Al Mubarak believes leading players now want to join Manchester City for more than just money.
The Emirati businessman says the Blues were forced to pay high fees to attract players after Abu Dhabi United Group took charge of the club in 2008.
Early signings included Brazilian Robinho for £32.5m and Nigel De Jong for an estimated £18m.
"We're a club players want to come and play for," said Al Mubarak.
"We were having to pay big premiums to attract the players we wanted to attract given we weren't in Europe.
"We're in a different position. We're an institution today."
|City's major post takeover signings in 2008-09|
|Nigel De Jong||Hamburg||£18m|
|Craig Bellamy||West Ham||£14m|
Market heating up
Al Mubarak believes City now have the infrastructure to lure leading players but expects competition to be fierce when the transfer window opens on 1 July.
"We can compete head-to-head with all the top clubs," he said.
"Players look at the track record of Manchester City over the last couple of years, look at the academy, the facilities, infrastructure, the people in terms of management and coaches - we have a very attractive proposition for players.
"Nevertheless, the market is a hot market.
"I think this year will be an aggressive market. I expect it will be a huge market this summer from what I've heard and sensed so far - and we haven't even started."
'Changes will make us stronger'
After winning the Premier League and League Cup in 2013-14, City ended last season without a trophy.
Manuel Pellegrini's team also exited the Champions League at the last-16 stage for the second successive campaign.
"We've created a great nucleus at Manchester City," said Al Mubarak. "We want to preserve this nucleus but at the same time we want to go to the next level.
"We want a squad which is able and has the capability and quality to win the Premier League, to compete and win the Champions League and be able to go all the way in two cup competitions in England.
"There are some players who have served us well. Maybe it's time for them to move to their next challenge.
"You will see us in the market bringing in high-quality individuals that fit within what we are aspiring to."
'Disappointment shows how far we've come'
City's spending led to them being punished under Financial Fair Play rules in May 2014.
They were still able to sign defender Eliaquim Mangala for £32m, midfielder Fernando for £12m, goalkeeper Willy Caballero for £6m and striker Wilfried Bony for £28m last season.
But the team could only finish runners-up to Chelsea.
"It was a disappointing season," said Al Mubarak.
However, he said it as "testament" to how far the team had come that second in the Premier League and a defeat to Barcelona in the last 16 of the Champions League was not good enough for the club.