Additional funding of $35.58m sought for Roosevelt hotel

Business Recorder

ISLAMABAD: The Aviation Division has sought additional funding of $ 35.577 million for Roosevelt Hotel Corporation, New York, USA to overcome its financial challenges with viable options, official sources told Business Recorder.

Sharing details, sources said in the backdrop of Covid-19 pandemic, the hotel industry has been severely impacted across the globe. The PIA-IL owned Roosevelt Hotel in Manhattan, New York, has also experienced extreme cash flow constraints since March, 2020. Chairman PIA-IL provided detailed information in this regard relating to the financial challenges being confronted in operations of Roosevelt Hotel, potential source of funds, union issues/dues, tenants’ affairs; future outlook and Board’s decision for GoP’s consideration and action.

The ECC formed a Committee headed by Deputy Chairman Planning Commission including Secretaries of Finance, Aviation and Law & Justice Division’s to deliberate on financial and legal implications of the issues in a holistic manner and submit its report with viable recommendations to the ECC.

After thorough deliberations, the Committee submitted its report with recommendations for consideration of ECC of the Cabinet. Aviation Division moved a summary on September 1, 2020 based on the report/ recommendations of the Committee, for consideration of ECC.

The ECC of the Cabinet considered the summary initiated by Aviation Division in its meeting held on September 2, 2020 and approved recommendations of the Committee including $ 142 million to address immediate financial requirements and $ I3 million per annum as carrying cost till such time GoP finalizes lease/ JV of Roosevelt’s site which did not include markup of $ 5.9 million per annum.

Finance Division arranged $ 142 million as a loan from National Bank of Pakistan with markup of $ 5.9 million per annum. However, the mode of financing of $ 142 million was not mentioned in the approval of the ECC.

Now, CEO, P1ACL, has submitted an additional demand for funding of $ 35.577 million, including carrying cost $ 13.0 million, for consideration of the earlier committee or fresh committee comprising the same members.

Aviation Division has proposed that a high-powered Committee headed by Deputy Chairman Planning Commission including Secretaries of Finance, Aviation and Law and Justice Divisions may be constituted again to deliberate on the additional funding of $ 35.577 million to Roosevelt Hotel Corporation to overcome the financial challenges with viable options. In the past, there were speculations that some influentials people in the incumbent government want to sell the hotel to some favourite(s) but the move was blocked due to political pressure.—MUSHTAQ GHUMMAN

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