During Vornado's 4th Quarter conference call, Jamie Feldman, a REIT Equity Research Analyst at Bank of America Merrill Lynch, asked the million dollar question to Mr. Roth.
Q: "...how should we think about Hotel Penn? Do you think you keep it hotel? Or is it too early to tell?"
Mr. Roth replied:
A: "The answer is, while we are zoned for a 3-million-foot tower -- a financial services headquarters tower, and as I tell my children, you have to look at the deals that almost happened, so that was a deal that almost happened when we were -- we had 2 huge investment banks on that at one time. In any event, the -- it looks to me like the math does not support a tower today. We are nothing if not realistic, and our plan is -- I wanted to say our current plan, I'm going take out the word "current." Our plan is to redevelop the Hotel Pennsylvania. Our objective there is multiples. Number one, we own that building for -- in the low hundreds of millions of dollars. It's worth 6x that or more. So our first objective is to get the hotel to be an asset to the neighborhood, not so much to make money in the hotel but to improve the neighborhood so that the value of our 7 million square feet of surrounding office space goes up. So that means we have to focus very hard on the lobby experience, on the hotel -- on the restaurant experience, the nightlife experience, what have you in that. The second is to make money on the hotel. And we believe every dollar that we put into that hotel in terms of renovation will be rewarded with very, very significant double-digit financial returns. Our third objective is to harvest some of the capital that we have in that building because the building is worth a lot of money, will become worth a lot more, and we have no debt on it and what have you. So that's our financial objective and our environmental objective, if you will, with respect to the hotel."
With that two things come to mind:
1. The plans for the office tower, have not been scrapped, just temporarily sidelined?
2. What two investment banks were "on" at that time?
The above transcript was taken from http://goo.gl/9G2og3
Wednesday, March 5, 2014
Thursday, February 27, 2014
We decided to go a new route with the launch of the new site. We are going to use it for new and exiting features, and breaking news. Naturally we will still post here as needed, but now you have two great place to get your Hotel Penn news! As always as we expand we are looking for new people to help join our crusade. If you think you got what it takes let us know!
Monday, January 27, 2014
It's a work in progress but, we are updating our original site http://www.savehotelpenn.org/. We managed to transfer most if not all out post to the new site, (sadly not the comments). We will be keeping both locations active, and making updates on both sites, so keep tuned!
Saturday, January 25, 2014
Tuesday, January 7, 2014
I came across this article from the NY Observer. They seem to be under the assumption that the City Council denied the rezoning application for the Gimbels Passageway. The truth is it was never turned down. The whole re-opening was part of the 15 Penn Plaza Project that never got off the ground (thank goodness).
Thursday, November 7, 2013
Wednesday, November 6, 2013
Renovations to the Hotel will soon be starting. Vornado announced in its third-quarter earnings call. Although we don't yet know the scope of the renovation, it is reported that they will be spending up to $300 million on the project.
Wednesday, June 5, 2013
As you may know, Madison Square Garden's lease is up and some influential groups in NYC want to see the garden torn down and a better Penn Station rebuilt. While I agree that it is time for a new station, I don't agree with are the (unofficial) design proposals... Take a look for yourself. I have no idea how these designs play tribute to a structure whose loss is possibly one of the greatest architectural blunders the city has ever seen. The architects need to rethink their designs... or get a good spanking.... Check it out here.
Thursday, May 2, 2013
Monday, April 1, 2013
We are currently in the process of writing up our proposal for the restoration of the hotel. We hope to come up with a plan that will restore the hotel but also set it up for great success in the 21st century. We will send the proposal to Vornado as soon as we can. We hope to work with Vornado to help make Hotel Pennsylvania one of the best hotels in Manhattan. More updates to come!