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End of an era for storied Waldorf Astoria hotel

MoneyWatch Headlines for June 28, 2016
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One of New York City's iconic hotels is slated to become condos.

Chinese insurance company Anbang Insurance Group reportedly plans to convert as many as three-quarters of the Waldorf Astoria's rooms into condos, according to The Wall Street Journal. Hundreds of hotel jobs would be lost with the transformation, the newspaper said.

Anbang didn't immediately return a request for comment.

The $1 billion redevelopment would mark a new era for the hotel, which opened in 1931 and whose construction was hailed by President Hoover as "an exhibition of courage and confidence to the whole nation." Situated on an entire city block on Manhattan's Park Avenue, the hotel became a byword for opulence and style, and has hosted celebrities such as the actress Grace Kelly and singer Frank Sinatra. Anbang bought the property last year for $1.95 billion.

Despite its place in American cultural history, the Waldorf Astoria has come under criticism from travelers who say the rooms are overdue for an upgrade. One reviewer on a travel site said he believed the hotel was "trading on its recommendation" and would urge fellow travelers to look elsewhere for lodging.

Converting the hotel into condominiums could help Anbang not only recoup its purchase price, but make a tidy profit as well. One analyst has estimated that a conversion to condos could raise as much as $4 billion in sales, the Journal noted.

The Waldorf Astoria wouldn't be the first historic New York hotel to be converted into condos. The Plaza Hotel -- the setting for the beloved "Eloise" children's books -- was largely converted into condos a decade ago.

Anbang, relatively unknown in the U.S., represents part of a wave of Chinese companies and individuals who are snapping up American real estate. Over five years, Chinese investors have spent more than $110 billion to purchase residential and commercial real estate in the U.S., partly because of the view that America represents a safe haven.

Anbang employs about 30,000 people, and sells property and casualty insurance, life insurance, health insurance, and pension insurance. It also is involved in banking and asset management, according to its website.

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