After years of trying, two investors have reached a deal to buy a majority share of the historic Plaza Hotel for $600 million, a top executive for the seller, the Sahara Group, confirmed.
The buyers are Shahal Khan, founder of the Dubai-based family office White City Ventures, and Kamran Hakim of the Hakim Organization, a major New York City landlord. The deal is scheduled to close on June 25.
Sandeep Wadhwa, head of corporate finance at the Sahara Group, which owns a 70 percent stake in the hotel, and Sant Singh Chatwal, a hotelier who owns the other 5 percent being sold, confirmed the deal. Both men declined to comment further, citing confidentiality agreements.
Opened in 1907, the Plaza is a city landmark and the only hotel listed on the National Register of Historic Places. Home of the literary troublemaker Eloise, famous for pouring water down the mail chute, the hotel has been featured in countless movies, from "North by Northwest" to "Home Alone 2," and was at one time owned by Donald J. Trump, who lost it in a bankruptcy. In 2005, it was largely converted into luxury condominiums, though a smaller hotel component and restaurants, including the Palm Court and the underground food hall, remain.
The Sahara Group has long tried to sell the property, and last year, it hired Jones Lang LaSalle, a brokerage firm, to carry out an auction of the property. The latest deal follows a string of reported sales that never came to fruition, though this time the buyers have made a $30 million deposit that they would forfeit if they backed out, making a completed sale more likely.
Read more from The New York Times:
The Plaza is for sale, but a part-owner has other ideas
What Donald Trump's Plaza deal reveals about his White House bid
Legal woes of owners help put the plaza back in play
The deal is complicated by the fact that a partnership of the Ashkenazy Acquisition, a real-estate firm, and Kingdom Holdings, which is controlled by the Saudi Prince Alwaleed bin Talel, owns the remaining 25 percent of the Plaza. The partners have the right of first refusal to buy the hotel at the same valuation. That right is set to expire sometime in the next week.
Prince Alwaleed was among a group of Saudi princes and ministers who were taken into custody by the government in November in a series of arrests orchestrated by Crown Prince Mohammed bin Salman.
Prince Alwaleed was released in January.
Calls to Kingdom Holdings and Ashkenazy Acquisitions were not returned.
The transaction is complex. The $600 million purchase price includes the refinancing of a more than $410 million mortgage on the hotel. The Qatari Sheikh Hamad bin Jassim bin Jaber Al Thani, known as H.B.J., holds the mortgage, which is set to mature in early July.
The sale was first reported by the real estate trade magazine The Real Deal.
Subrata Roy, chairman of the Sahara Group, and Mr. Chatwal bought their shared stake in the hotel in 2012. Shortly after the purchase, Indian regulators sought to arrest Mr. Roy over a bond sale. He was jailed for two years, and has since been ordered to return several billion dollars.
In 2010, Sahara purchased the Grosvenor House, a historic hotel in London. Last year, Ashkenazy Acquisition, with financing from H.B.J., acquired that hotel. As part of that deal, H.B.J. took over the mortgage on the Plaza.
Mr. Khan has spent several years trying to buy the hotel. It was suggested that he would use cryptocurrency to fund the acquisition, but the financing for the deal is a combination of traditional equity and debt.
Mr. Hakim is a major landlord, with a portfolio of properties worth more than $1 billion. He sued to get off New York's 100 worst landlord list, arguing that the buildings cited were vacant. A judge ruled against him in the suit last year, and he is now listed at No. 26.
Mr. Khan confirmed the deal, but declined to comment further. Mr. Hakim did not return requests for comment.