ISLAMABAD: Pakistan has decided to redevelop its iconic Roosevelt Hotel inNew York into a high-rise structure through a joint-venture model,potentially attracting three to five billion dollars in investment whilesignificantly enhancing the value of its stake. The government hasexplicitly ruled out an outright sale of this prized overseas asset, optinginstead for a partnership that allows retention of substantial ownership.This strategic move aims to unlock the full commercial potential of theprime Manhattan property, as revealed by senior officials.
Muhammad Ali, the prime minister’s adviser on privatisation, emphasisedthat an immediate sale would fail to realise the site’s true value. Acomprehensive study conducted by Jones Lang LaSalle Americas Inc last yearindicated that the current sixteen-storey building could be replaced by atower of fifty to sixty storeys. The hotel, closed since 2020 due tofinancial losses, was recently transferred to the PIA holding company amidthe airline’s restructuring process.
For more than two decades, successive Pakistani governments have consideredvarious options for the Roosevelt Hotel, including sales, long-term leases,or redevelopment projects. However, none of these initiatives progressedbeyond preliminary stages due to political and economic challenges. Thecurrent plan marks a renewed effort aligned with broader privatisationgoals under international financial commitments.
Under the proposed joint-venture framework, the Pakistani government willcontribute the land and existing structure as its equity share. A privatepartner is expected to provide approximately one billion dollars in directequity investment. Additional funds, ranging from two to four billiondollars, will be raised through debt financing to complete the ambitiousredevelopment.
Officials anticipate that the project could take four to five years tomaterialise once a partner is selected. Interest from internationalinvestors remains high, given the hotel’s strategic location near GrandCentral Terminal, Times Square, and Fifth Avenue. This midtown Manhattansite spans over forty-two thousand square feet, making it one of the mostvaluable undeveloped parcels in New York real estate.
After completion, Pakistan’s ownership stake is projected to dilute fromone hundred percent to between forty and fifty percent. Despite thisreduction, the overall value of the government’s holding is expected toincrease by up to two hundred and fifty percent due to the enhanceddevelopment. This dilution reflects the injection of substantial privatecapital required for the high-rise transformation.
The Roosevelt Hotel, named after former United States President TheodoreRoosevelt, has a rich history dating back to its opening in 1924. Acquiredby Pakistan International Airlines in the late twentieth century, it servedas a landmark accommodation for decades before operational difficulties ledto its closure. Brief use as a migrant shelter in recent years furtherhighlighted its adaptability but underscored the need for revitalisation.
This redevelopment initiative forms part of Pakistan’s wider privatisationagenda, supported by international lenders to improve fiscalsustainability. By partnering with private entities, the government seeksto generate long-term revenue streams without relinquishing controlentirely. The approach balances immediate financial needs with sustainedeconomic benefits from a modernised asset.
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Selection of a new financial adviser is underway following the previousconsultant’s withdrawal due to potential conflicts. Expressions of interestfrom potential joint-venture partners are anticipated soon, with theprocess aimed at transparency and maximum value extraction. Officialsexpress confidence in attracting global developers capable of executing thevisionary project.
The decision to pursue high-rise redevelopment over outright disposaldemonstrates a shift towards strategic asset management. It reflectslessons from past attempts and incorporates detailed market assessments.Ultimately, the plan positions the Roosevelt Hotel as a flagship example ofpublic-private collaboration in unlocking dormant state-owned properties.
Source: https://www.arabnews.pk/node/2628089/pakistan
Tags: Pakistan, Roosevelt Hotel, New York, Joint Venture, Privatisation,Muhammad Ali, Jones Lang LaSalle, PIA
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