USA
he renowned Pakistan International Airlines (PIA) has entered into an agreement to lease its prized possession, the iconic Roosevelt Hotel in New York, to the city’s administration for a substantial sum of $220 million. The lease contract spans three years, after which the ownership of the property will revert back to PIA.
Having acquired the prestigious Manhattan hotel in 2000, PIA’s decision to lease it is influenced by the hotel’s extended closure during the pandemic and Pakistan’s ongoing economic challenges.
Pakistan’s Federal Minister for Railways and Aviation, Khawaja Saad Rafique, announced the deal during a press conference on June 5, highlighting that the infusion of $220 million will serve to settle the hotel’s outstanding liabilities and contribute to the country’s treasury.
History
Stepping into the Roosevelt Hotel is akin to stepping back in time. Erected in 1924, the hotel’s atmosphere retains the essence of the “Roaring Twenties,” an era of unprecedented economic prosperity, as evidenced by the grandeur of the architectural marvels from that time. The intricate moldings, gold-adorned interior embellishments, plush sofas, and regal chandeliers all exude opulence. A standout feature is the Palm Room, an oval-shaped tea room with a two-story height adjacent to the lobby, boasting a magnificent mural and a central elaborate chandelier, all enveloped by marble pillars.
Throughout its history, the Roosevelt Hotel has left an indelible mark on New York’s cultural landscape. Legendary musician Guy Lombardo led the in-house band from 1929 to 1962, becoming an integral part of the hotel’s identity. The hotel gained fame as the place where Lombardo and his band, “The Royal Canadians,” performed their iconic rendition of Auld Lang Syne on New Year’s Eve, a tradition that endures in American culture. The hotel also hosted numerous distinguished musicians, including jazz maestro Jan Garber and accordionist Lawrence Welk. It has been a significant venue for political campaigns, particularly for the Republican Party, utilizing the location for campaign operations until the 1980s, including campaigns for President Dwight B. Eisenhower and New York Mayor John Lindsay.
The Roosevelt Hotel’s legacy continues through its presence in films and television shows. Scenes from movies like Wall Street (1987), French Connection (1971), and Maid in Manhattan (2002), as well as the popular TV show Mad Men (2007-2015), were filmed on its premises. The hotel even offered Mad Men-themed vacation packages due to the show’s immense popularity.
The hotel’s association with PIA began in 1978 when it was leased by PIA Investments Ltd, the investment arm of PIA, and Saudi prince Faisal bin Khalid bin Abdulaziz Al Saud. The partnership involved a deal worth around $35 million, with an option to buy the property after the 20-year lease concluded at a predetermined price of $36.5 million. The PIA later faced operational challenges and embarked on significant renovations to revitalize the property. After successful renovations, the hotel returned to profitability, prompting PIA to exercise its option to purchase in 1998. However, this decision led to a legal dispute with the Milstein family, the hotel’s original owner, regarding its valuation.
Following a court battle, PIA emerged victorious and acquired full ownership by buying out Al Saud’s stake in 2005, with the court recognizing the 1978 valuation, thus resulting in a favorable outcome for PIA.
