Introduction: From Historic Landmark to Economic Lifeline
Pakistan is betting big on a century-old Manhattan hotel to help rescue its struggling economy. The Roosevelt Hotel, an iconic Beaux-Arts property at 45 East 45th Street in Midtown Manhattan, is being valued at over $1 billion as Pakistan seeks a redevelopment partner through a joint venture rather than an outright sale. This strategic move comes as Islamabad grapples with a severe economic crisis, mounting external debt exceeding $131 billion, and stringent International Monetary Fund (IMF) conditions tied to a $7 billion bailout package.
The Roosevelt, once a symbol of American luxury hospitality and Pakistan’s most valuable overseas asset, has had a tumultuous recent history. Closed to regular guests since 2020 due to the COVID-19 pandemic, it controversially served as New York City’s primary migrant shelter from May 2023 to June 2025, processing over 173,000 asylum seekers during the city’s immigration crisis. Now, with shelter operations concluded and the building vacant, Pakistan sees an opportunity to unlock potentially $3-4 billion in total investment value by redeveloping the prime real estate into a 50-60 story mixed-use tower.
For a nation whose foreign exchange reserves stood at just $16.64 billion by March 2025—barely enough to cover three months of imports—every dollar from overseas assets matters. The Roosevelt redevelopment represents not just a real estate transaction, but a critical component of Pakistan’s economic survival strategy.
The Roosevelt Hotel: A Century of Glamour and History
A Jewel in Manhattan’s Crown
The Roosevelt Hotel occupies one of the most coveted locations in New York City—45 East 45th Street at Madison Avenue, steps from Grand Central Terminal, Fifth Avenue, and Times Square. In Manhattan real estate terms, this represents the absolute pinnacle of commercial desirability.
Opened in 1924, the hotel was designed by the prestigious architectural firm George B. Post & Sons in the elegant Beaux-Arts style that defined early 20th-century luxury. The engineering feat that made the hotel possible was nothing short of remarkable: the building was constructed ingeniously over active railway tracks leading into Grand Central Terminal, requiring innovative structural solutions that were groundbreaking for the era.
The original hotel boasted impressive specifications:
- Over 1,000 guest rooms
- Royal suites designed for visiting dignitaries
- A presidential suite complete with a private terrace
- Childcare services—a revolutionary amenity in the 1920s
- An in-house doctor for guest medical needs
- State-of-the-art facilities that set new hospitality standards
The Conrad Hilton Era and Cultural Significance
By the 1940s, the Roosevelt had become a flagship property under legendary hotelier Conrad Hilton, who famously made the hotel’s presidential suite his personal residence. Under Hilton’s stewardship, the Roosevelt made hospitality history by becoming the first hotel in the world to install televisions in every guest room—a technological innovation that would soon become industry standard.
The hotel’s cultural significance extended far beyond its amenities. It became known as the “Grand Dame of Madison Avenue” and earned a reputation as a glamorous hub for high-society events, galas, and New Year’s celebrations in Midtown Manhattan.
Musical Legacy:
- Musician Guy Lombardo and his Royal Canadians performed at the Roosevelt for over 30 years, turning the hotel into a New Year’s Eve tradition
- Lawrence Welk’s orchestra became a regular fixture
- Pakistani rock band Junoon performed there in the 1990s
Political Headquarters:
- New York Governor Thomas E. Dewey used the hotel as his election-night headquarters
- Numerous political figures hosted campaign events and victory celebrations in its ballrooms
Hollywood Connection:
- Films including Wall Street (featuring Michael Douglas), The French Connection (with Al Pacino), and Maid in Manhattan (starring Jennifer Lopez) featured scenes shot at the Roosevelt
- The acclaimed television series Mad Men showcased the hotel in multiple episodes
Over its long history, the Roosevelt became a favorite of aristocrats, socialites, business magnates, and cultural figures—a true crossroads of American power, wealth, and celebrity.
How Pakistan Came to Own a New York Icon
The 1978 Lease Deal
Pakistan’s connection to the Roosevelt began during a very different era for both the country and the property. In 1978, real estate investor Paul Milstein leased the hotel to PIA Investments Ltd, the investment arm of Pakistan International Airlines (PIA), with an option to purchase the property later at a fixed price.
The deal also involved Saudi royal Prince Faisal bin Khalid bin Abdulaziz Al Saud as a financial partner, reflecting the close economic ties between Pakistan and Saudi Arabia during that period.
The Struggling Years and Turnaround
The initial investment did not go smoothly. The hotel was aging, maintenance costs were escalating, and the property ran substantial losses in its early years under PIA management. However, after significant renovations and operational improvements, the financial performance began to stabilize and eventually improve.
The $36.5 Million Acquisition
In 1998, recognizing the long-term value of the Manhattan location, PIA exercised its option to purchase the Roosevelt for approximately $36.5 million—a price that would prove astonishingly low for such prime real estate. The transaction did not proceed without complications; a prolonged legal battle with the Milstein family ensued before PIA finally acquired full ownership by 2000.
What Pakistan had secured was extraordinary: a blue-chip New York asset purchased at what would soon be recognized as a bargain price, with massive long-term appreciation potential. In the two-and-a-half decades since, Manhattan real estate values have skyrocketed, making the $36.5 million purchase price look like one of the shrewdest foreign investments Pakistan ever made.
From Profit Engine to Pandemic Casualty
The Glory Years as a Four-Star Hotel
For two decades after the 2000 acquisition, the Roosevelt functioned as a busy four-star hotel serving business travelers, tourists, and event attendees. Its prime location near major corporate offices, transportation hubs, and tourist attractions ensured consistent occupancy and revenue streams.
The hotel maintained its cultural cachet, continuing to host events, serve as a filming location, and welcome guests from around the world. For Pakistan’s government and PIA, it represented a reliable overseas asset generating steady income in US dollars—a valuable source of foreign exchange.
The 2020 COVID-19 Shutdown
Everything changed in 2020 when the COVID-19 pandemic decimated global travel and hospitality. International tourism to New York City evaporated virtually overnight, business travel ceased, and hotel occupancy rates plummeted to historic lows.
Facing mounting operational losses with no guests and no prospect of recovery in the near term, PIA made the difficult decision to close the Roosevelt to regular guests at the end of 2020. The 1,000-plus room hotel sat largely vacant as the pandemic continued into 2021.
The Migrant Shelter Controversy (2021-2025)
The Roosevelt’s next chapter was unexpected and controversial. Between 2021 and 2023, New York City—facing an unprecedented influx of asylum seekers and migrants—leased the Roosevelt as a migrant shelter and processing center.
By May 2023, as thousands of migrants began arriving weekly in New York City seeking refuge, Mayor Eric Adams formalized a $220 million, three-year contract to convert all 1,025 rooms for use as a migrant shelter. The arrangement guaranteed PIA a minimum income equivalent to 1.5 years of shelter use, with a nightly rate of $202 per room.
Dubbed the “new Ellis Island,” the Roosevelt became the primary venue where migrants:
- Applied for shelter placements throughout New York City
- Were screened for health hazards and communicable diseases
- Located relatives already living in the United States
- Accessed legal aid for their asylum cases
- Received temporary accommodation while awaiting processing
Over the course of two years, the Roosevelt processed approximately 173,000 migrants—a staggering number that made it the epicenter of New York’s migrant crisis. By 2024, the hotel had become an unexpected emblem of the city’s immigration challenges.
The arrangement brought in short-term revenue for Pakistan at a time when every dollar mattered, but it also generated intense political scrutiny and public debate in New York City. Critics questioned the cost-effectiveness of the contract, while supporters argued it addressed a genuine humanitarian crisis.
On February 24, 2025, Mayor Adams announced that the Roosevelt would wind down its migrant operations, which ceased in June 2025 as border crossings plummeted and the flow of migrants slowed dramatically. By early 2026, shelter operations had completely concluded, and the building returned to PIA’s control—vacant, awaiting its next chapter, and ripe for redevelopment.
Pakistan’s Economic Crisis: Why the Roosevelt Matters Now
The Depth of Pakistan’s Financial Troubles
To understand why Pakistan is pursuing an aggressive redevelopment strategy for the Roosevelt, one must grasp the severity of the nation’s economic crisis.
Debt Crisis:
- Total public debt reached approximately 76 trillion Pakistani Rupees (PKR) by end-March 2025
- Foreign debt exceeded $131 billion by late 2025
- Public debt-to-GDP ratio stood at 70.7% in fiscal year 2025, with per capita debt burden rising 13% amid higher interest costs and exchange rate pressures
- The government is increasingly borrowing just to meet routine expenditures
Foreign Exchange Reserves:
- Forex reserves stood at $16.64 billion by March 2025, with the State Bank of Pakistan holding $11.5 billion and commercial banks retaining $5.14 billion
- As of November 2024, Pakistan held approximately $16,133 million in reserves
- This represents barely three months of import cover—a precarious position for a nation of 240 million people
- In 2023, Pakistan’s reserves had fallen to just two weeks of import cover, bringing the country to the brink of default
Growth Challenges:
- Pakistan missed its FY 2024-25 GDP growth target amid sluggish growth, persistent inflation, and shrinking foreign reserves
- The country is seeking $4.9 billion in external loans to stabilize its economy
- Fitch upgraded Pakistan’s sovereign rating from CCC+ to B- with a stable outlook in 2025, a modest improvement but still indicating significant credit risk
The IMF Bailout and Privatization Mandate
Pakistan’s $7 billion IMF bailout package, agreed in September 2024, came with stringent conditions. Chief among these was a mandate for large-scale privatization of state-owned enterprises and assets.
The IMF has made privatization a key condition for any future financial support, warning that without structural reforms and asset sales, Pakistan could face a debt crisis similar to Sri Lanka’s economic collapse.
“Agenda-5”: Pakistan’s Privatization Push
According to government documents and cabinet-level discussions in Islamabad, Pakistan has embarked on an informal “Agenda-5” privatization plan targeting a wide range of public-sector entities for transfer to private ownership by the end of 2026:
Major Privatizations:
- Pakistan International Airlines (PIA): Sold to Arif Habib Group in December 2025 for PKR 135 billion (approximately Rs 4,300 crore or $500 million USD), with a requirement for PKR 80 billion in fresh investment over five years
- Power Distribution Companies: Three power utilities are being prepared for sale
- Banks: Several state-owned financial institutions are on the privatization list
- Hotels: Including potential redevelopment of the Roosevelt
- Insurance Firms: State insurance companies targeted for divestment
- Energy Assets: Various energy-related state enterprises
The Roosevelt Hotel redevelopment fits squarely within this broader privatization strategy, representing an opportunity to monetize a high-value overseas asset without triggering the domestic political backlash that often accompanies sales of national enterprises within Pakistan.
The Billion-Dollar Valuation: Ambition or Reality?
Why $1 Billion Makes Sense in Manhattan
At first glance, valuing a closed, century-old hotel at over $1 billion might seem wildly optimistic. However, in Manhattan real estate—particularly in Midtown—location and development potential matter far more than the existing structure.
Prime Location Factors:
- Transportation Hub: Steps from Grand Central Terminal, one of the world’s busiest commuter hubs
- Commercial Density: Surrounded by office towers, corporate headquarters, and high-value commercial tenants
- Retail Corridor: Near Fifth Avenue’s luxury shopping district
- Tourist Attractions: Walking distance to Times Square, Bryant Park, and major cultural institutions
- Infrastructure Access: Excellent subway, bus, and rail connections
Development Potential:
The Roosevelt sits on approximately 42,000 square feet of Midtown Manhattan land. Under current zoning and modern construction techniques, this site could support a 50-60 story mixed-use tower combining residential apartments, office space, retail, and potentially hotel components.
Manhattan Real Estate Context:
According to recent market data, Manhattan real estate values continue to climb:
- Median rents in Manhattan exceeded $5,000 by late 2025, representing an 18% increase from 2024
- Luxury residential developments in prime Midtown locations command premium prices
- Office space in top-tier Midtown buildings remains among the most expensive in the world
- New developments in Manhattan routinely value land at tens of millions of dollars per buildable square foot
When viewed through this lens, a $1 billion+ valuation for redevelopment isn’t ambitious—it’s realistic.
The $3-4 Billion Total Investment Vision
Pakistan’s government envisions that the redevelopment could attract $3-4 billion in total investment once a joint venture partner is secured. This figure reflects not just the land value but the complete cost of demolishing the existing structure, designing and constructing a new high-rise tower, and bringing a world-class mixed-use development to market.
For context, comparable new developments in Midtown Manhattan have required similar or larger investment levels:
- Central Park Tower on West 57th Street involved investment exceeding $4 billion
- 111 West 57th Street required billions in development costs
- Major mixed-use developments combining residential, office, and retail space routinely exceed $2-3 billion in total project costs
Pakistan’s expectation is that a major international developer will recognize the site’s potential and commit the capital necessary to transform it into a landmark property that could generate returns for decades.
The Joint Venture Model: Retaining Equity While Unlocking Value
Why Not Sell Outright?
Pakistan’s decision to pursue a joint venture rather than an outright sale reflects strategic financial thinking.
Advantages of the Joint Venture Approach:
- Long-term Value Capture: Pakistan retains an equity stake, allowing the country to benefit from future appreciation and income streams
- IMF Compliance Without Asset Loss: Meets privatization requirements while maintaining ownership interest
- Political Palatability: Easier to defend domestically than selling a prized national asset entirely to foreign investors
- Professional Management: Brings in experienced developers with capital and expertise while Pakistan remains a stakeholder
- Income Generation: Could provide dividend income for years or decades once the development is operational
The Transaction Structure:
According to Pakistani government sources, the transaction structure approved by the cabinet rules out an outright sale. Instead, Pakistan will:
- Maintain ownership through an equity partnership
- Offer a minority or majority stake (exact percentage undisclosed) to a qualified development partner
- Expect an initial payment of $100 million by June 2026
- Project a 4-5 year redevelopment timeline
- Finalize partner selection within 6-9 months
Jones Lang LaSalle (JLL), one of the world’s premier commercial real estate services firms, has been appointed to manage the selection process. The firm will evaluate potential partners, negotiate terms, and structure the joint venture to maximize value for Pakistan while ensuring the project’s viability.
“Interest Level Is Extremely High”
A senior Pakistani government official told Reuters that interest from global developers is “extremely high” for the Roosevelt redevelopment opportunity. This enthusiasm reflects several factors:
- Rare Opportunity: Midtown Manhattan development sites of this size and location rarely become available
- Established Infrastructure: Unlike greenfield projects, the site has utilities, access, and established zoning
- Market Demand: Strong demand for both luxury residential and premium office space in Midtown
- Government Partner: Pakistan’s involvement provides certain advantages in terms of land tenure and regulatory navigation
Multiple international development firms, real estate investment trusts (REITs), and private equity funds with real estate portfolios are reportedly evaluating the opportunity.
The Redevelopment Vision: A 50-60 Story Mixed-Use Tower
From Historic Hotel to Modern High-Rise
Pakistan’s vision for the Roosevelt site is transformative: demolish the existing century-old hotel structure and replace it with a modern 50-60 story mixed-use tower.
Proposed Development Components:
- Residential Condominiums: Luxury apartments targeting high-net-worth individuals, offering Manhattan’s most desirable amenities and views
- Premium Office Space: Grade-A office floors for corporate tenants, financial firms, and professional services
- Retail and Restaurants: Street-level and lower-floor commercial space for high-end retail and dining
- Potential Hotel Component: Some proposals may include a boutique luxury hotel as part of the mixed-use development
Development Timeline:
- Selection Process: 6-9 months to finalize joint venture partner
- Design and Approvals: 12-18 months for architectural design and regulatory approvals
- Construction: 3-4 years for tower construction and fit-out
- Total Timeline: 4-5 years from partner selection to project completion
Alternative Development Proposals
Several development groups have already expressed interest in redeveloping the Roosevelt. In April 2025, real estate investor Farhan Khan’s Burkhan World Investments and its partners pitched PIA on a redevelopment deal. While details of that specific proposal weren’t disclosed, it demonstrated the level of interest from experienced Manhattan developers.
Timeline and Next Steps
The Road to Redevelopment
Immediate Milestones:
- Q1 2026: JLL conducts outreach to qualified developers and investors
- June 2026: Pakistan expects initial payment of $100 million from selected partner
- Q2-Q3 2026: Finalize joint venture agreement and ownership structure
- Late 2026: Begin design and regulatory approval process
- 2027: Commence demolition and site preparation
- 2030-2031: Target completion of new development
Critical Success Factors
For Pakistan’s Roosevelt redevelopment to achieve its billion-dollar valuation goals, several factors must align:
Market Conditions:
- Manhattan real estate market must remain strong
- Demand for luxury residential and premium office space must continue
- Interest rates and construction financing must remain favorable
Regulatory Approvals:
- New York City planning and zoning approvals
- Environmental reviews and building permits
- Community board engagement and potential opposition management
Partner Selection:
- Securing a reputable, well-capitalized development partner
- Negotiating favorable terms that balance Pakistan’s equity retention with partner returns
- Ensuring partner has track record of successful large-scale Manhattan developments
Political Stability:
- Continuity of Pakistan’s economic policies and privatization commitment
- IMF program remaining on track
- No political upheaval that could derail the transaction
Broader Implications: What the Roosevelt Means for Pakistan
A Test Case for Asset Monetization
The Roosevelt redevelopment represents a test case for how developing nations can monetize overseas assets strategically rather than simply selling them under financial duress.
If successful, Pakistan’s approach could:
- Generate immediate cash flow ($100 million initial payment by June 2026)
- Maintain long-term equity participation in a valuable asset
- Demonstrate sophisticated financial structuring that balances short-term needs with long-term value
- Provide a model for other Pakistani overseas assets that might be candidates for similar treatment
The Larger Economic Context
The Roosevelt is just one piece of Pakistan’s economic puzzle, but it’s a symbolically important one. Success here could:
- Boost investor confidence in Pakistan’s privatization program
- Generate foreign exchange at a critical moment
- Demonstrate the government’s ability to execute complex international transactions
- Help meet IMF conditions and unlock further bailout funds
Conversely, failure to secure a favorable deal could:
- Undermine confidence in the broader privatization program
- Force Pakistan to accept less favorable terms or an outright sale
- Signal to international investors that Pakistan’s most valuable assets may be distressed opportunities
Conclusion: From Historic Landmark to Economic Lifeline
The Roosevelt Hotel’s journey—from 1924 grand opening to Hollywood filming location, from Pakistani investment to migrant shelter, and now to billion-dollar redevelopment opportunity—reflects both the building’s resilience and Pakistan’s economic desperation.
For New Yorkers, the Roosevelt represents a century of urban history, a landmark that welcomed presidents and celebrities, housed migrants in crisis, and now faces transformation into a modern skyscraper. For Pakistan, it represents something equally profound: a rare overseas asset that could generate desperately needed foreign exchange, demonstrate financial sophistication, and help stabilize an economy teetering on the edge.
The $1 billion+ valuation isn’t mere optimism—it’s grounded in Manhattan’s relentless real estate fundamentals and the site’s irreplaceable location. The 42,000 square feet of Midtown land, steps from Grand Central and surrounded by some of the world’s most expensive commercial real estate, genuinely justifies such valuations when redeveloped to modern density.
As Jones Lang LaSalle begins the formal process of selecting a development partner, Pakistan awaits a transaction that could reshape both the Manhattan skyline and the nation’s economic trajectory. The century-old “Grand Dame of Madison Avenue” is about to be reborn—not as a historic hotel, but as a symbol of Pakistan’s struggle to turn valuable assets into economic survival.
Whether this billion-dollar bet pays off will depend on market conditions, partner selection, and Pakistan’s ability to navigate complex international real estate development while maintaining political stability at home. But one thing is certain: the Roosevelt Hotel, once a symbol of American luxury and Pakistani investment success, has become an economic lifeline for a nation in crisis—and its next chapter will be written not in guest registers, but in construction contracts, equity agreements, and foreign exchange flows.