Why Pakistan wants to demolish NYC’s iconic Roosevelt Hotel

The iconic Roosevelt Hotel in New York is staring at a possible demolition. Owned by
the Pakistan International Airlines (PIA), the hotel has been used as a welcome center and shelter for migrants by the New York City (NYC) administration since May.

As per a report in the Pakistani daily Dawn, the PIA wants to raze down the iconic structure in NYC to build a new hotel through a joint venture. This comes amid Pakistan’s economic woes and financial troubles afflicting the airlines.

How did Pakistan come to own The Roosevelt Hotel in New York? What is its plan for the famed building now?

History of the Roosevelt Hotel

Built in 1924, the hotel is named after the 26th United States president Theodore Roosevelt. Renowned for its opulence, the hotel was once a defining feature of New York’s social life, hosting everyone from politicians to celebrities to artists.

Legendary musician Guy Lombardo has become synonymous with the hotel’s legacy. He and his band performed their first song at the Roosevelt Grill and in October 1929 and went on to perform at the hotel for the next 30 years. The band’s performance of Auld Lang Syne on New Year’s Eve at the place kickstarted a tradition in American culture that continues till now, as per an Indian Express report.

The midtown masterpiece evokes memories of the ‘Roaring Twenties’, a time of economic prosperity as depicted in the buildings of the time, the report added.

The Republican party used the hotel as a campaign office till the 1980s. The hotel has also been featured in several popular films and TV shows, including Maid in Manhattan and Mad Men.

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PIA comes into the picture

The Pakistan government-run PIA entered the picture in 1978 when American real estate mogul Paul Milstein bought the hotel. He then leased the hotel to PIA’s investment arm, PIA Investments Ltd, as per the Indian Express report.

Pakistan’s flag carrier had joined hands with Saudi Prince Faisal bin Khalid bin Abdulaziz Al Saud to bag the roughly $35 million deal. After the lease expired in 20 years, they had the option to buy the hotel for $36.5 million, the report added.

For the initial decade and a half of the lease, the hotel started making losses under the PIA. However, after renovations, the hotel finally started raking in money, leading to the airline opting for the option to purchase the building in 1998.

The PIA has been the sole owner of the renowned Manhattan hotel since buying Al Saud’s stake in 2005, as per Indian Express.

Why PIA wants to demolish the hotel

A representative of Pakistan’s Aviation Division told the Senate Standing Committee on Aviation on Wednesday (6 December) about PIA’s intention to demolish the hotel, reported Dawn.

This comes after the airline leased the hotel to the New York City Administration in June for three years for $220 million. “A contract was signed for 1,250 rooms. The hotel will be returned to the government of Pakistan once the three-year term lease expires,” the then Minister of Railways and Aviation Khawaja Saad Rafique said at the time, as per Geo News.

This was a larger part of the Pakistan government’s plan to ease the economic crisis of the country.

While talks around the PIA selling the iconic hotel have surfaced since it took over its ownership in the 2000s, they never materialised. The hotel got a major blow during the COVID-19 pandemic when it was closed down in 2020.

It finally reopened earlier this year and has been a shelter for migrants since May. By September, the NYC administration was providing lodgings to hundreds of migrant families at the hotel.

Meanwhile, there are now discussions about the privatisation of the PIA in Pakistan. The airline faced its worst fuel crisis in October after Pakistan State Oil stopped its fuel supply, citing mounting unpaid dues. Pakistan’s flag carrier, which has liabilities to the tune of Rs 266 billion, had to cancel 77 flights at the time, reported Dawn.

Now, the Aviation Division has told the committee that financial advisers working on the PIA’s privatisation would make recommendations about the Roosevelt Hotel but the multiple properties of the airline were not linked to the talks. It also warned that the PIA would suffer huge losses if the deal failed to materialise, according to the Pakistani newspaper.

With inputs from agencies