Indian Billionaire Buys Manhattan’s Plaza Hotel

Subrata Roy can now add another trophy to his growing showcase of high class businesses. The billionaire has just bought the prestigious Plaza Hotel. The founder and charmain of Sahara India Pariwar is now the proud owner of 75 percent of the hotel's stakes. The Plaza is one of the most well-known hotels in the world and has a glamorous list of past clients including Alfred Gwynne Vanderbilt, The Beatles, Mark Twain, Eleanor Roosevelt, and even President Barack Obama just earlier this year.

The Sahara group closed a $575 million deal last Monday with Elad Properties, an NYC-based branch of the El-Ad group.

Solid Rock chairman, Greg Rice, brokered the deal. According to Rice, “This was a great opportunity for the buyer to expand into a key US market with the purchase of an irreplaceable asset… arguably one of the world's most valuable pieces of real estate."

Elad Properties bought the hotel in 2004 for $675 million and invested another $400 million to convert a part of the hotel into private condos.

The Plaza Residences, the condominium part of the property, has 182 units. Prices range from $1 million up to $50 million. Unfortunately, the condo business venture was unsuccessful. Sales were poor and many buyers complained about the quality of the condos. The mall inside the Plaza also experienced its share of difficulty. Many stores situated in the hotel's mall lost revenue due to lack of shoppers.

The Plaza's remaining 25 percent stake belong to Kingdom Holding Co., which is a Saudi Arabic investment company owned by Prince Al-Waleed bin Talal. Due to a long-term contract, Fairmont Hotels and Resort will continue to manage the 230-room hotel.

This newest investment is not the only asset of the Sahara Group in Manhattan. On the same day the Plaza was purchased, Sahara also acquired “Dream New York” from Vikram Chatwal for $220 million. The 216-room hotel is located at 210 West 55th Street in Midtown West.

Sahara is rumored to be interested in other NYC hotels according to the New York Times. The said hotels the Sahara alleged plans on purchasing are the Mandarin Oriental, Four Seasons, and the Waldorf-Astoria. All of them are some of Manhattan’s most luxurious and iconic properties.

The Plaza is New York’s embodiment of wealth and society, but this purchase is more of an economical trophy than a practical capital investment.