Pakistan says Roosevelt Hotel’s base valuation complete, will decide on transaction structure this month
Pakistan has completed the baseline valuation of the Roosevelt Hotel in New York and is preparing to move forward with a transaction structure this month to privatize the state-owned property, the head of the Privatization Commission told Arab News this week.
The Roosevelt, whose liabilities and losses the privatization chief did not disclose, is one of several state assets the government hopes will contribute to its target of raising Rs86 billion ($306 million) in privatization proceeds during the fiscal year starting July 1, alongside the sale of national carrier Pakistan International Airlines and three electricity distribution companies.
But how much money the hotel ultimately brings in, and its overall valuation, depended on the type of transaction structure adopted, Ali said.
If the government opted for a straightforward “as-is” sale and sold the property without securing any new permissions or approvals for zoning or development, the hotel would fetch the lowest price.
However, if the government first obtained the necessary permits and approvals that a buyer would typically need for redevelopment, the property’s value could double compared to the “as-is” sale.
Alternatively, if the government formed a joint venture with a private investor, sharing both the risks and future profits, the hotel could be worth four to five times more than its as-is valuation.
Mehreen Zahra-Malik