NAB to investigate closure of Roosevelt Hotel, losses borne by govt

Published October 13, 2020
NAB chairperson Justice retired Javed Iqbal addresses a ceremony. — APP/File
NAB chairperson Justice retired Javed Iqbal addresses a ceremony. — APP/File

National Accountability Bureau (NAB) chairperson Justice retired Javed Iqbal has taken notice of reports that the historic Roosevelt Hotel, a Pak­istani possession in the heart of Manhattan, will be shuttered by the end of this month, a press statement by the watchdog said on Tuesday.

According to the release, Iqbal has directed the bureau's Rawalpindi director-general to probe the reasons behind the decision to shutter the hotel, which is Pakistan's "national asset".

Furthermore, NAB will look into the reasons behind the alleged loss of hundreds of thousands of dollars borne by the government. The accountability watchdog will also point out officials who allegedly showed "carelessness in performing their national duties" and failed to play a role in making the hotel into a profitable entity.

The statement comes days after the Roosevelt Hotel announced it will shut its doors on guests permanently on October 31.

“Due to the current economic impacts, after almost 100 years of welcoming guests to The Grand Dame of New York, The Roosevelt Hotel, is regretfully closing its doors permanently as of October 31, 2020,” the announcement said.

A photo posted by Instagram (@instagram) on

The message on the website said that the hotel was “working on alternative accommodations” for guests with future reservations.

The Roosevelt Hotel, which was opened on September 23, 1924, was built by Niagara Falls businessman Frank A Dudley and operated by the United Hotels Company.

The Pakistan International Airlines leased the hotel in 1979 through its investment arm, PIA Investments Ltd, with an option to purchase the building after 20 years. Prince Faisal bin Khalid bin Abdulaziz Al Saud of Saudi Arabia was one of the investors in the 1979 deal.

In 1999, the PIA exercised its option and bought the hotel for $36.5 million. In 2005, the PIA bought out its Saudi partner in a deal that included the prince’s share in Hotel Scribe in Paris in exchange for $40 million and the PIA’s share of the Riyadh Minhal Hotel. The PIA has since controlled 99 per cent interest in the hotel while the Saudis have only 1pc.

After fully acquiring the hotel, PIA undertook its renovation. Following refurbishment, it started making profit after a long time and continued doing so till 2018. But the onset of the coronavirus pandemic brought doom to the hotel and tourism sector and Roosevelt Hotel was no exception.

The main reason for its decline is the obsolescence of its infrastructure and depleted room conditions.

Diplomatic sources have clarified that the PIA still owned the property as the building had not been sold.

One such source also attributed the hotel's closure to the novel coronavirus that "has almost killed the hotel industry".

The sources explained that the building was still valued at more than a billion dollars. “Pakistan now has two options, sell it or convert it into a condominium like other Manhattan hotels hit by Covid-19,” another source said.

Opinion

Poll language
17 Apr 2021

Poll language

There is a distinction between angry rhetoric and the language of the gutter.
Exempt from accountability?
Updated 17 Apr 2021

Exempt from accountability?

PM Khan has done a disservice to Pakistan by exempting certain institutions from performance requirements.
Education disrupted
Updated 16 Apr 2021

Education disrupted

The cost of not doing anything about them in terms of learning losses and dropouts are going to be very large.

Editorial

17 Apr 2021

Pak-India mediation

QUESTIONS had been swirling about what and who has prompted the latest detente between Pakistan and India. Now, it...
17 Apr 2021

Energy exploration

SOME exploration and production companies want the government to prioritise offshore exploration — a high-risk...
17 Apr 2021

Professor’s removal

IN a step that will go far in sending a message of reassurance to female students and academic staff in ...
Ban is no answer
Updated 16 Apr 2021

Ban is no answer

The ban will not dilute the narrative that fuels the party, it may even fan it.
16 Apr 2021

Slow recovery

THE pace of growth in large-scale manufacturing output continues to slow down, with LSM production contracting by...
16 Apr 2021

Ramazan profiteering

WITH the month of Ramazan underway, people have begun to feel the effects of galloping inflation even more. Prices...