The NA Standing Committee on Privatisation was reported that US President Donald Trump shows interest in buying the Roosevelt Hotel, owned by Pakistan International Airlines (PIA) in New York.
During the meeting, PML-N committee member Khawaja Asif asked PIA officials about the buyers who have shown interest.
At this, the managing director of PIA Investments Ltd, Najeeb Samie surprised the committee by telling about Trump’s interest in Roosevelt Hotel.
It is noteworthy that President Trump is a billionaire with a business mindset. He already owns seven luxury hotels and several resorts and clubs in several major US cities.
Why sell the Roosevelt Hotel?
In the meeting, Najjeb brief the committee that Roosevelt is a three-star hotel, profitable for 99 years. However, the hotel suffered a loss of $1.5 million last year.
He added, by looking at the financial condition of PIA it is quite non-profitable to run the entire hotel on its own. Therefore, he suggested replacing Roosevelt with offices and hotels.
Khawaja Asif of the PML-N didn’t oppose this decision but said, “This wasn’t a suitable time to privatize any entity. As the Coronavirus pandemic has caused market prices of almost everything to fall.”
The decision of Cabinet Committee on Privatisation (CCoP)
On July 2, the Cabinet Committee on Privatisation (CCoP) decided in a meeting that:
“The Roosevelt Hotel will operate under a joint venture with a third party.”
The CCoP agreed to hire a financial adviser to start the process for the transaction in the light of the report of M/s Deloitte (an auditing firm) from July 2019.
The statement further adds that “the highest and best use of the Roosevelt Hotel Property is to redevelop the site into a mixed-use (through Joint Venture) of primarily office tower over retail and condominium”.
As per details, CCop directed Deloitte to update the commission within four weeks.
The Roosevelt Hotel
In 1979 PIA Investment Limited procured the hotel on lease with an option to purchase the property. At that time, PIA had purchased the hotel for $36.5 million against a demand of $59.5m in 1999. The Roosevelt has been managed by Interstate Hotels & Resorts since 1997.
Moreover, Roosevelt is a 19-story hotel with 1,025 rooms in New York. It is a valuable property that also bears cultural importance for Pakistan.
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