Page 37 - Midas Touch

I knew the neighborhood could use a big change, and I believed the first
step would be to acquire and restore the Commodore Hotel. I remember
that even my father couldn’t believe I was serious about this. In fact, he
said, “Buying the Commodore at a time when even the Chrysler Building

is in bankruptcy is like fighting for a seat on the Titanic.” We both knew it
was a risk, but I was certain the renovation would change the
neighborhood back into the flourishing area it could and should be. I could
visualize it and, because of that, I knew I was right. That gave me a lot of
confidence—which I was going to need.

About a year before I started negotiating for the hotel, the owner (Penn
Central Railroad) had wasted about $2 million in renovations that made no

positive improvement whatsoever. It was obvious that the hotel still
needed a great deal more work, and the owner still owed $6 million in
back taxes. They were ready to sell. I could therefore take an option to
purchase the hotel for $10 million—but I would have to structure a
complex deal on my own before making the purchase. I would need
financing, a commitment from a hotel company, and a tax abatement from
the City of New York. All of this was complicated, and negotiations took

several years.

During these negotiations, I was looking for a talented designer who could
make this old hotel into a spectacular landmark. I met a young architect
named Der Scutt who understood my vision. I wanted to wrap the building
in something shiny to give the whole area a new façade. I wasn’t sure this
deal would even happen, but I was so positive it could be great for the area
that I spent the time to discuss it with Der Scutt and hired him to do some

drawings, just in case, so we’d be ready.

I also knew I’d need a big hotel operator because a hotel with 1,400 rooms
and 1.5 million square feet isn’t a job for just anyone. When I reviewed
the most experienced names in the business, the ones with the best track
records, Hyatt seemed to be at the top of the list. I was hoping they might
be interested because, although hard to believe today, at that time Hyatt

had no hotel in New York City. I was right. They were interested. We made
a deal as equal partners, and Hyatt agreed to manage the hotel after it was
completed.