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Next month marks a bittersweet anniversary for New York hotels.
Last November, a Japanese hotel company paid $230 million for an unopened hotel on West 54th Street. Now called the Rhiga Royal Hotel, observers were surprised that a West Side property with no track record could fetch $455,000 a room, a price reserved for glitzy Fifth Avenue properties.
Today, not only are such prices too high, but selling at what owners consider reasonable seems impossible.
Developer Larry Silverstein found no takers when he tried to sell his yet-to-be opened Embassy Suites Hotel on West 52nd Street for what sources say was about $400,000 a room. No one was interested in investing in the Halloran House when its owner put its value at $300,000 a room. Finally, not only won't Donald Trump get the $1 million a room he says the Plaza Hotel is worth he hasn't yet found a buyer at the price he's willing to make a deal at, which sources put at $618,000 to $803,000 a room.
A deteriorating market
"By the time we were ready to sell, the market had deteriorated," says Mr. Silverstein, president of Silverstein Properties Inc., who refused to say how much he wanted for the hotel. "We took it off the market so it wouldn't get bandied about."
Sellers' high asking prices and a dearth of willing capital sources are leaving hotels wanting for buyers. Properties such as the Plaza Hotel, the St. Moritz Hotel and the Omni Park Central Hotel are languishing on the market.
Sellers have yet...