Plaza Hotel Is On the Block
NEW YORK—The Indian owners of the Plaza Hotel have hired a broker to sell the New York City landmark, a sign that a world-wide scramble among investors, celebrities and governments to acquire the property could be nearing an end.
Sahara Group, a Lucknow, India-based conglomerate and the hotel’s majority owner, has enlisted JLL Hotels and Hospitality Group, a unit of real-estate firm JLL , to find a buyer, according to a person familiar with the matter.
While it is unclear how much a buyer would pay for a trophy property like the Plaza, hotel investors and brokers suggest it could be one of the most expensive hotel sales on a per-room basis, a popular industry metric. By that method of valuation it could bring in more than $500 million.
A Sahara spokesman didn’t comment on the hiring of a broker but said a “sale is under process and it has not yet concluded.”
The Plaza has a pedigree few hotels can match. It has been featured in novels like “The Great Gatsby” and numerous films, including Alfred Hitchcock’s “North by Northwest.” Marilyn Monroe and the Beatles stayed there. John F. Kennedy’s sister Patricia Kennedy held the reception after her wedding to Peter Lawford in the Plaza’s ballroom.
Previous owners of the 110-year old property include hotelier Conrad Hilton and Donald Trump, who once compared it to the Mona Lisa.
How much the iconic structure might fetch is up for debate. It has an enviable location at the southeast corner of Central Park, and charges some of the highest room rates in the country. A one-night stay next Saturday starts at $616 a night, while “legacy suites” cost $2,125 or more a night, according to the Plaza’s website.
But many of its best rooms with sweeping views of Central Park have been sold as condos, and the opening in recent years of new Manhattan luxury hotels such as the Park Hyatt and Baccarat have heated up competition for affluent travelers.
But some say a prestige property like the Plaza is less confined by market trends. Mr. Hennessey figured the hotel would likely receive bids that could value the property at close to $2 million a room, a price that would include the hotel’s Todd English food hall, other restaurants, retail shops and public spaces.
The only U.S. hotel sales to exceed $2 million a room were the Baccarat, the Midtown Manhattan hotel that sold in 2015 for $230 million, and the Plaza itself in 2012, according to STR.
By that valuation, the Plaza could be worth about $560 million.
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Source: Wall Street Journal
