NEW YORK: Pakistan is considering options for the Roosevelt Hotel in New York City, including razing the iconic landmark and building a skyscraper in its place, as part of Islamabad’s efforts to meet commitments under its $7 billion International Monetary Fund (IMF), Bloomberg reported.
The Roosevelt Hotel, a century-old Manhattan property owned by the Pakistan International Airlines (PIA) through its investment arm, is considered one of Pakistan’s most valuable foreign assets. Islamabad is pursuing a joint venture model rather than an outright sale, seeking a redevelopment partner to maximize its long-term value as part of a broader privatization drive.
The South Asian country says it expects the privatization of the Roosevelt Hotel to be completed this year. The property, located near Grand Central Terminal, Times Square and Fifth Avenue, was closed in 2020 due to heavy losses but has since been used intermittently, including as a temporary migrant shelter.
Muhammad Ali, adviser to the prime minister on privatization, last week told Bloomberg that one of the options is to raze the storied landmark and build a skyscraper in its place and that his government is keen on a joint venture in which Pakistan will contribute the land and the partner will bring in the equity. The other option is to retain the hotel if it makes sense economically, he said.
“We will have clarity on this in the next few months after finalization of the JV partner and market sounding,” Ali was quoted as saying by Bloomberg on Oct. 4.
Last month, global real estate firm Jones Lang LaSalle (JLL) resigned as financial adviser for the hotel’s partial sale, citing a conflict of interest due to client involvement. The government has since accelerated efforts to appoint a new adviser and proceed with the joint venture model approved by the federal cabinet.
Pakistan is in the process of appointing advisers for the hotel transaction, dubbed by some as “the new Ellis Island” for its historical role as a migrant intake point, Bloomberg reported. The government will finalize a new adviser later this month after bids from seven groups, including Citigroup Inc., CBRE Group Inc., and Savills PLC.
Prime Minister Shehbaz Sharif’s government is making its most ambitious effort in years to restructure or sell state-owned companies as committed to the IMF under the terms of the $7 billion loan agreement secured in Sept. 2024.
The first asset to be sold could be PIA that has been surviving on bailouts that the government can no longer afford. Ali hoped the government would be able to sell the national flag carrier by Nov. this year, Bloomberg reported.
