The Premier League new boys agreed an undisclosed fee, thought to be in the region of £4million, for the highly-rated 22-year-old, who becomes Birmingham's third signing of the summer.
Dann follows Christian Benitez and Stephen Carr in committing to St Andrews and having fought off competition from a number of rival top flight clubs, Gold is confident Birmingham have signed a player of considerable potential.
"It's a very exciting signing for us, it's very important for us because we've lost a couple of our central defenders," Gold told Sky Sports News.
"Sadly, Liam Ridgewell has been injured and we probably won't see him back before close to Christmas.
"He's a very exciting player and he scores goals from defence, which is an extra. He's a record signing for our defence. We've broken the record and for us it's a substantial signing.
"He was a must-have player, we've been tracking him for a long time and we've fought off some ferocious competition from a number of serious clubs.
"It's always a great feeling when you beat off competition to win the battle, and by competition I mean clubs that will be battling with you next season.
"If you can outmanoeuvre those clubs then you've got a greater chance of survival."
Gold went on to reveal he expects to bring in a further three players and while he is not afraid of getting the chequebook out again, he admits boss Alex McLeish could bring in some free transfers to keep the club on track financially.
"I've got to say it's a delicate balance, you like to bring in some free transfer as well.
"When you're spending money you need to ensure you're doing so wisely and carefully.
"Be sure that you're buying a player who is going to make a difference, young enough to hold his value so if the worst happens, you'll have a saleable commodity.
"I would think we're probably been linked with five to six players at the moment and if we can get another three I would be quite pleased with that.
"It's a very difficult situation and this is where the likes of (owner, David) Sullivan, (chief executive, Karen) Brady and of course Alex play a massive part in this football club, they are massively skilled.
"Our board has been in place for 16 years, we've been in the Premier League for six or seven seasons. We've got great experience of what works and perhaps doesn't work so well."