Exclusive | As NYC’s historic Roosevelt Hotel site sits in limbo, Morgan Stanley team poised to become new financial adviser: sources
A group backed by Morgan Stanley seems to be the frontrunner to become the new financial adviser for Pakistan International Airlines (PIA) as they deliberate on the future of the Roosevelt Hotel site in Midtown East, sources disclosed to The Post on Monday.
This consortium is set to replace JLL, which stepped down from the role last summer.
PIA, under the jurisdiction of the Pakistani government, is reportedly considering proposals from seven potential groups, including the Morgan Stanley team with CBRE, Manhattan’s top commercial brokerage, to advise on the future of the Roosevelt Hotel and facilitate any transactions, as stated by Saudi Arabia-based daily Arab News.
No official confirmation has been provided regarding PIA’s plans.
One source expressed skepticism, noting, “The Roosevelt owners have entertained various scenarios for over a decade without taking any definitive action.”
Last summer, a team from JLL led by the firm’s regional CEO Peter Riguardi resigned from the account. A Pakistani government agency cited JLL’s departure as a measure to avoid any perceived or actual conflict of interest, given the firm’s representation of clients with interest in the site.
Since then, PIA has not named a new financial adviser, a role that would involve facilitating a sale of the site, either outright or in partnership with a developer. Arab News reported that PIA aims to select a new adviser promptly this month.
However, a prominent Manhattan dealmaker expressed doubt, stating, “It’s been a significant waste of time, largely due to the property’s ties to the government of Pakistan and their regularly changing military leadership.”
While JLL’s exit was linked to potential conflicts of interest, it is common for major Manhattan brokerages to represent both sides of a transaction.
It’s not uncommon for brokers to represent developers eyeing projects in the same areas. Additionally, JLL’s client roster, featuring leading developers and tenants, was known to both the brokerage and PIA when the airline engaged JLL in February 2024.
Riguardi declined to provide a statement, and emails to PIA for comment remained unanswered.
As previously reported, Pakistan’s government is reliant on proceeds from a Roosevelt sale to fulfill a $7 billion bailout agreement with the International Monetary Fund.
The Roosevelt site, situated between Madison and Vanderbilt avenues and East 44th and 45th streets, is a prime piece of Manhattan real estate in an area attracting prestigious tenants near Grand Central Terminal.
The vacant hotel is surrounded by prominent developments such as the JP Morgan Chase headquarters tower, future Boston Properties tower, and an upcoming SL Green project.
A new office tower at the site could offer up to 1.8 million square feet under Midtown zoning regulations allowing for sizeable bonuses in exchange for transit and pedestrian enhancements.
The 1,000-room Roosevelt Hotel has remained empty since the city terminated PIA’s contract to use it as a shelter for migrants earlier this year.
PIA has fluctuated in its decisions regarding the property since taking ownership in 2000, considering various options from outright sale to partnership arrangements. Recent statements by Pakistani officials suggest that the building may not be demolished soon and could potentially reopen as a hotel.
However, industry experts find this suggestion amusing, noting the extensive cleanup required after the migrant shelter operation, and the uncertainty in the market for both office and hotel spaces.
