Posted by Leonard Steinberg on April 9th, 2012
New York’s famed Plaza Hotel built in 1907 is for sale again by current owner Elad Properties: the landmark property that recently underwent a significant renovation and was partially converted to condominium residences has traded hands several times over the past decade. Sahara India Pariwar Ltd from India is the reported buyer. The cash offer is for the hotel “as is” and debt free. Fairmont Hotels & Resorts Inc. manages the hotel, which overlooks Central Park and the Plaza in front of Bergdorf Goodman across from the APPLE store, for Elad. The Sahara Group would terminate the contract with Fairmont Hotels. The estimated price is $ 575-600 million, a relative bargain considering individual apartments have sold in the building for almost $ 50million. Sahara Group has supposedly already made a down payment for the Plaza Hotel, and is conducting due diligence. It says that the hotel part of the property, which has 100 condominiums and 130 large condominium rooms, is being valued at $400 million, and its premium retail space is being valued at around $200 million. It also says that a condition of a deal is for Elad to first terminate the management agreement with Canada’s Fairmont Hotels with immediate effect.
I’ve always felt the retail segment of the hotel was a bit of a flop: I think New Yorkers are simply not used to entering a mall-like setting and don’t particularly like it…..especially when above or below street level. Time Warner seems to be doing much better although the other night I spotted several vacancies above street grade. I also felt the service and quality of the hotel was a bit disappointing and hopefully this sale will improve things. Remember when Ivana Trump and the Donald were in charge? Those were the days….
Neiman Marcus Group Inc. swung to a fiscal second-quarter profit on steep write-downs a year earlier, as the luxury retailer posted higher revenue and lower expenses. The Dallas-based retailer is also owner of BERGDORF GOODMAN. Neiman’s is probably the most important barometer of the Luxury market, and this certainly is a good indicator of the luxury market in general. The key message appears to be that through cost-cutting measures along with improved sales, profits have improved too. The trend to profitability seems consistent: lay-offs. The harch bottom line is that lower income earners suffer at the expense of the top income earners who live for profit. This fuels a stronger luxury market, but reduces the spending power of the lower earners. Hopefully with this rebound the employment market will improve too as the need for additional help registers without impacting profits. All good for the luxury real estate market in New York.
Profits improved after their lay-offs in 2009.
Luxury buyers are also shopping more relative to the stock market increase.
With continued market stability one is hopeful Neiman Marcus will increase their staff and others will follow.
Hi – thanks for the post. I never know what I will come across when I scroll these blogs. But just wanted to let you know I really liked yours. Keep it up.
Sandy