The New York Waldorf Astoria sale- a Chinese spy story in the making?

[webfact]

The New York Waldorf Astoria sale- a Chinese spy story in the making?

NEW YORK: -- A US landmark hotel and security and spying is a concern by the US government. This Waldorf Astoria New York Hotel was not only scene of many Hollywood movies, was frequently the venue of world news, it has played host to US envoys to the United Nations for more than 50 years.

This New York Hotel purchase is being investigated by the government of the United States. When Hilton Worldwide Holdings announced on October 6 that it was selling the regal Waldorf Astoria hotel and residences to the Beijing-based Anbang Insurance Group for $1.95 billion, it caught the attention of the US government.

The president of the United States is a frequent guest of the Waldorf Astoria hotel in New York, and it also happens to be the residence of choice for US envoys to the UN – and now its sale to a Chinese firm is raising security concerns in Washington.

China may be the next landlord and owner of this hotel. It will be the first purchase in the United States for Anbang Insurance Group. The company – which is controlled in part by members of China’s ruling class and relatives of some Communist revolutionary leaders – was started in 2004 with seed money from nationalized industries like Sinopec oil. The company is headed by Wu Xiaohui, who is married to the granddaughter of Deng Xiaoping, the former leader of China, The New York Times reported.

US Ambassador to the UN Samantha Powers also has a residence at the hotel, and it hosts many heads of state and government.

Hilton Worldwide Holdings told the US news agency Reuters that it would continue to manage the hotel for Anbang for the next 100 years and that the property would “undergo a major renovation to restore the property to its historic grandeur.”

The deal is scheduled to close on December 31, but if the closing time is delayed, the sale must be finalized no later than March 31.

Source: http://www.eturbonews.com/51483/new-york-waldorf-astoria-sale-chinese-spy-story-making

-- eTN 2014-10-15

[keemapoot]

I used to stay there some years ago, and even though a grand dame of great world hotels, it has been showing its age for a long time.

Actually, having the MSS (Chinese equivalent of the CIA) ensconsed there would make the place even yet more storied.

Bring it on.

[Costas2008]

"the property would “undergo a major renovation to restore the property to its historic grandeur.”

And hide the microphones, cameras etc. etc.

[keemapoot]

Anybody had a Waldorf Salad? Delicious and reminds me of that Fawlty Towers episode where the boorish American guest demands one.

The salad was first created between 1893 and 1896 at the Waldorf Hotel in New York City (the precursor of the Waldorf-Astoria Hotel, which came into being with the merger of the Waldorf with the adjacent Astoria Hotel, opened in 1897).^[2]

[Publicus]

In addition to the State Department singularly the U.S. Treasury Department Office of Foreign Assets Control is undertaking a thorough examination of this pending sale.

The Treasury Department is the head of its Foreign Assets Control Board which includes DepState, DepDefense, USIntelligenceDirectorate, Dep HomelandSecurity, DepJustice, DepCommerce and a few other related departments and agencies.

The Treasury's OFAC has rejected purchases by several CCP companies to include Huawei which it accused on hacking and spying on the Pentagon and industrial espionage as well.

A storied history and any romantic feelings aside, when this office and its governing board become involved, especially concerning China companies, they have consistently been very tough and restrictive of such sales/purchases or deals of any sort.

The office has stopped the CCP Boyz in Beijing purchasing companies near or adjacent to U.S. military installations in the U.S. and influential with foreign governments to prevent and preclude the same kind of activity abroad.

[LawrenceChee]

Yes if only the Hilton group will continue to generate enough escrow cash to keep their buildings in pristine condition ...but alas a pipe dream as some owners cannot do so anymore in the continental USA to keep it up as their cash flow lacks serious continuity

The sale is a good thing for an icon to be preserved. For the paranoid anything is bad.

[Publicus]

There's nothing wrong with Hilton roping in a tidy $2 billion sale price if it Is consummated. The U.S. government will look at the business end of the deal as well as the security side of it, which is why the Treasury's Foreign Asset Control Board has a diverse cabinet level membership of department secretaries.

And it's good that the United States is the number one destination of global foreign direct investment and that the PRChina investors will of course have to cash it up in USD$.

If Hilton can snag $2 bn for the high profile property then I'd want to meet some equally easy CCP fatcats so I can get $5 million for my humble six room abode back in the States. So I'm looking for a Chinese who knows some Texas type PRC fatcats......

The bottom line here is that institutional investors in the USA and in the West are well positioned in the PRC and have been for a long time.

China Construction Bank for instance is owned in part by Bank of America, HSBC, Bank of New York Mellon. The four have among them overlapping investors such as Microsoft, Merk, Apple, ExxonMobile, Pfizer, Chevron, Google, Facebook, Wells Fargo, J.P. Morgan Chase, Johnson & Johnson.....and lots more. Maybe this deal is a simpler one and not for all that much money relatively speaking.

DepState is presently leading the inquiry and is expected to make its recommendation to the cabinet secretaries that sit on the OFAC Board. DepState does know Democrats and Republicans in Congress have separately and together looked at the expense of using the Waldorf Astoria and have concluded it's cheaper than choosing another hotel or other location to start everything over again, from the security standpoint especially.

Edited October 15, 2014 by Publicus

[LawrenceChee]

The Chinese will buy anything that has an astute value to it but there are some suckers anywhere from all nationalities who might believe n everything an sly agent would say to close a deal ....

so you may have hope as yet for that wreck of yours if you believe it's overpriced.... just have to find a smart mouthpiece and in general there are some really slick ones I have seen in the west

It may pain some to understand while the deal is reported in U.S. dollars that may not be the final currency of transactional close ...oh yikes another patriotic dream shattered

Edited October 15, 2014 by LawrenceChee

[MJP]

They could use the Holiday Inn instead.

[LawrenceChee]

They could use the Holiday Inn instead.

Just too bad most holiday inn do not command the real estate value based on their locations ..there are some nice ones within the brand but rare

Although the holiday inn express is fantastic value in Asia

[MJP]

They could use the Holiday Inn instead.

Just too bad most holiday inn do not command the real estate value based on their locations ..there are some nice ones within the brand but rare

Although the holiday inn express is fantastic value in Asia

I like any old B&B.

One week I was staying at the Fairmont Hamilton Princess in Bermuda. Ghaslty soft bed and a cockroach in the bathroom for $500 a night. The next week Aranyapraphet Garden Hotel, fan only and cold shower $3 a night. Wonderful comfy bed and great chicken steak round the corner.

[LawrenceChee]

They could use the Holiday Inn instead.

Just too bad most holiday inn do not command the real estate value based on their locations ..there are some nice ones within the brand but rare

Although the holiday inn express is fantastic value in Asia

I like any old B&B.

One week I was staying at the Fairmont Hamilton Princess in Bermuda. Ghaslty soft bed and a cockroach in the bathroom for $500 a night. The next week Aranyapraphet Garden Hotel, fan only and cold shower $3 a night. Wonderful comfy bed and great chicken steak round the corner.

Good for you ...the business needs a variety of guest who enjoy different brands and different owner builds

I agree with you ...some are so nostalgic and historic and gives a different sense

On the other hand the blvgari resort at jimbaran bay sweeps the emotions during sunset when you are there with someone special

[Wan123]

I think it would be good fun for everyone! Can have a spy wing on top floors, and if you see a huge amount of chinamen running around you know they are confused spys! But anyway, who cares about chit chat in residences for UN Ambassadors. They're a transparent organization anyway

[SinCityGr8One]

I think the Chinese are brilliant when it comes to purchasing Foreign Assets. The Waldorf-Astoria is right up on Top with brand recognition World-Wide. Further more, they are investing in residential real estate in the USA heavily. One area is in the Las Vegas Valley. Chinese buyers generally don't haggle with the listed price and pay cash for homes there. Regardless of all the talk by the naysayers, the Chinese view the USA as a safe haven for investment and will meet the residency requirement for their children's University education. With two way trade between the USA and PRC at $500 Billion per year, it is only natural for them to invest there. While the Thieves of Wall Street and Bankster's applaud plant closing and layoff's, the Chinese know that in order to continue to sell "Made in China" products, Americans need jobs to purchase them. That's why they will invest in Businesses also in the USA. They look for long term gain and not just today's bottom line.

[LawrenceChee]

This month we will in Italy as there is now a dedicated government website for businesses that want to sell out to the Chinese

At the Dumno later this month and hoping to advise the clients to do the same ...inject needed cash and leave it the way it is ....Italian culture style and most clients understand this

Just like Haier ...own it but don't covert it ...

Huawei chairman made a good statement in response to USA banning them ..."we operate already in 150 countries and when USA is ready, we will be there to offer our services and for the time not being in the USA is not important to the company hitting 40 billion in annual sales as the world largest communication company"

[Chicog]

Anybody had a Waldorf Salad? Delicious and reminds me of that Fawlty Towers episode where the boorish American guest demands one.

"We're out of Waldorfs"

[razer]

I think if tax revenues are supporting these grand lifestyles, the Holifday Inn would be just fine.

[Publicus]

The Chinese will buy anything that has an astute value to it but there are some suckers anywhere from all nationalities who might believe n everything an sly agent would say to close a deal ....

so you may have hope as yet for that wreck of yours if you believe it's overpriced.... just have to find a smart mouthpiece and in general there are some really slick ones I have seen in the west

It may pain some to understand while the deal is reported in U.S. dollars that may not be the final currency of transactional close ...oh yikes another patriotic dream shattered

What ever it is you might be on about, good luck with it.

I bought some CNY really cheap the other day from the owner of my favorite Chinese restaurant because my grandson needed more money for his monopoly game board - an anything for the grand kids kind of thing as one can no doubt appreciate.

I have met a considerable number of CCP market socialism with Chinese characteristics business people in the PRC and elsewhere. Their first eager beaver question always is: "How can we do that?". I trust the guys buying the Waldorf Astoria really do know what they are doing and with whom they are dealing. I'd hope so because a Shanghai minute takes three times as long as a New York minute does, and five times as long in Beijing. (HKG and NYC are pretty much on the same time.)

The Chinese business men and women that are superior on the mainland are from either Taiwan or Hong Kong - they clean the clocks of the market socialism with Chinese characteristics entrepreneurs. Clothes washing machines that consume the WC (bathrooms) have become common in the PRC and I suppose too that eventually one of these days they'll have dish washing machines to climb over in their kitchens (no sign of it yet at all however).

Edited October 16, 2014 by Publicus

[bim]

Ohh the hypocracy of the US. Dont they spy on there own allies and friends.?

Edited October 16, 2014 by bim

[LawrenceChee]

The Chinese will buy anything that has an astute value to it but there are some suckers anywhere from all nationalities who might believe n everything an sly agent would say to close a deal ....

so you may have hope as yet for that wreck of yours if you believe it's overpriced.... just have to find a smart mouthpiece and in general there are some really slick ones I have seen in the west

It may pain some to understand while the deal is reported in U.S. dollars that may not be the final currency of transactional close ...oh yikes another patriotic dream shattered

What ever it is you might be on about, good luck with it.

I bought some CNY really cheap the other day from the owner of my favorite Chinese restaurant because my grandson needed more money for his monopoly game board - an anything for the grand kids kind of thing as one can no doubt appreciate.

I have met a considerable number of CCP market socialism with Chinese characteristics business people in the PRC and elsewhere. Their first eager beaver question always is: "How can we do that?". I trust the guys buying the Waldorf Astoria really do know what they are doing and with whom they are dealing. I'd hope so because a Shanghai minute takes three times as long as a New York minute does, and five times as long in Beijing. (HKG and NYC are pretty much on the same time.)

The Chinese business men and women that are superior on the mainland are from either Taiwan or Hong Kong - they clean the clocks of the market socialism with Chinese characteristics entrepreneurs. Clothes washing machines that consume the WC (bathrooms) have become common in the PRC and I suppose too that eventually one of these days they'll have dish washing machines to climb over in their kitchens (no sign of it yet at all however).

I understand not everyone has stayed at the hyatts marriotts Hilton in China before ...the quality is outstanding and the buildings are among the best of their brands worldwide but then again yeah it's not for everyone.

So thanks for the concern but someone who pays a billion for a building knows the in/out of managing a property profitably , not a skill set everyone would have in recent times

[keemapoot]

Anybody had a Waldorf Salad? Delicious and reminds me of that Fawlty Towers episode where the boorish American guest demands one.

"We're out of Waldorfs"

ahem...slight correction :

Mr. Hamilton: Would you make me a Waldorf Salad?

Basil Fawlty: [having never heard of it] I beg your pardon?

Mr. Hamilton: Get me a Waldorf Salad.

Basil Fawlty: Well, I think we just ran out of Waldorfs!

Mr. Hamilton: You're gonna stay here, nice and quite, while these people say whether or not they're satisfied. And you move off that spot, Fawlty, I'm gonna bust your ass!

Basil Fawlty: Everything's bottoms, isn't it?

[keemapoot]

This is all much ado about nothing. Does anyone really think prohibiting the Chinese from buying a landmark historical NY hotel is going to stop the MSS from taking up residence in other digs? Anyway, in terms of industrial espionage, it's not even the MSS doing it, it's the zillions of Chinese exchange students who couldn't even afford a cup of coffee at Waldorf's Peakock Alley restaurant, let alone a Waldorf salad.

[Scott]

Off-topic post removed.

[Chicog]

"the property would “undergo a major renovation to restore the property to its historic grandeur.”

And hide the microphones, cameras etc. etc.

Don't you mean replace the ones put there by the NSA, CIA and FBI on Osama Obama's watch?

Who gives a sh#t what the elite think. The USA government is nothing but a bunch of bought and paid for bad actors who jump when their leash it tugged.

China already has enough treasury bonds (1.32 trillion) to collapse the market should they ever call in, so really then, what's one hotel?

And I give a hoot about where the US President cr@ps after he retires from playing golf and ignoring issues like US veterans dying from government neglect and abuse, or his precious IRS playing Nazi thugs and covering up for his scumbag Justice Department head "Eric "Hold-em-up" Holder, and Osama Obama protecting his Islamic friends across the world.

I'd like to apologize about this outburst, but simpleton pap for the idiot masses just gets my goat. And they call this news?

This isn't news. It's a diversion. Apparently it works.

"simpleton pap for the idiot masses", well at least you got that right, although not in context.

[chiang mai]

I stayed there in circa 1981 as the guest of a UK bank, ok, it was Barclays! The room was okay, not great but OK, the hookers in the lobby were a pest and complaints to staff made no difference.

[ChiangraiTony]

This month we will in Italy as there is now a dedicated government website for businesses that want to sell out to the Chinese

At the Dumno later this month and hoping to advise the clients to do the same ...inject needed cash and leave it the way it is ....Italian culture style and most clients understand this

Just like Haier ...own it but don't covert it ...

Huawei chairman made a good statement in response to USA banning them ..."we operate already in 150 countries and when USA is ready, we will be there to offer our services and for the time not being in the USA is not important to the company hitting 40 billion in annual sales as the world largest communication company"

Not to split hairs but to be more precise there are some subtle differences. Actually Huawei isn't the world's largest communication company despite what you have posted. It is however, the largest telecommunications equipment maker/ supplier in the world.

[TheCruncher]

I think it would be good fun for everyone! Can have a spy wing on top floors, and if you see a huge amount of chinamen running around you know they are confused spys! But anyway, who cares about chit chat in residences for UN Ambassadors. They're a transparent organization anyway

I think the notation of this in the OP was just as a reminder to our US members as how their tax money is wasted spent.

[NCFC]

Anybody had a Waldorf Salad? Delicious and reminds me of that Fawlty Towers episode where the boorish American guest demands one.

The salad was first created between 1893 and 1896 at the Waldorf Hotel in New York City (the precursor of the Waldorf-Astoria Hotel, which came into being with the merger of the Waldorf with the adjacent Astoria Hotel, opened in 1897).^[2]

Three years to make a salad? Hell, I would never wait that long.

[Publicus]

I understand not everyone has stayed at the hyatts marriotts Hilton in China before ...the quality is outstanding and the buildings are among the best of their brands worldwide but then again yeah it's not for everyone.

So thanks for the concern but someone who pays a billion for a building knows the in/out of managing a property profitably , not a skill set everyone would have in recent times

I said the population of the PRChina still doesn't know what a dish washing machine is and I referred to the small apartments most PRChinese live in which they erroneously call a house. There are very few free standing houses in the PRChina contrasted to nearly everyone in metro areas living in apartments.

The Wall Street Journal headline on this story was, "Hilton Tosses Waldorf to Chinese Insurer," which pretty much sums up the fact the hotel's salad days are over...,

The grand though aged Waldorf needs a renovation, a task that will add substantially to Anbang's sticker price. Such an investment could be paid back with higher room rates or proceeds for the sale of rooms converted to condominiums. That Hilton itself preferred to skip the risk is a sign of the task ahead.

The Chinese buyers are paying $1.4 million per room for 1413 rooms when the going price in Manhattan is $1m.

Hilton Worldwide Holdings Inc has 27 Waldorf Astoria Hotels & Resorts to include in Beijing and Shanghai and is adding other destinations such as Bangkok and Bali. If Hilton had wanted to sink money in to the New York property it would have done so. Hilton instead will apply the take on this fast deal to the U.S. hotel market such as the coming soon Beverly Hills Waldorf Astoria.

China’s equities and property markets are stagnant so PRC insurance companies are going to where the value is, which is U.S. real estate. One could say Hilton saw 'em coming cause Hilton turned away two other suitors to sign this deal in no time at all..

As to the security aspect, here's what a NYPD source related to the New York Post .....

“The Chinese are very tricky. They are involved in snooping for proprietary reasons to gather intelligence on us and to gain an advantage in the capitalistic world we live in,” a law enforcement source told The Post. “They are trying to gain that advantage on us — and one of the major ways they’re doing this is by stealing our computer secrets.”

The Waldorf sale could open the door to a world of spilled secrets.

“A lot of important people who possess secret information stay at the Waldorf,” the source said. “That information could get into the hands of the Chinese now.”

http://nypost.com/2014/10/13/amid-security-concerns-us-eyes-sale-of-waldorf-astoria-to-chinese-firm/

I'm not sure the Treasury Department's Board of cabinet secretaries that review these things want to put the financial collar back around the neck of the Hilton group, but the security aspect just might force the decision in that direction. If the renovation plan simply changes how the president has to come and go at the hotel then the sale is dead in the water.

Edited October 16, 2014 by Publicus

[Spoonman]

I understand not everyone has stayed at the hyatts marriotts Hilton in China before ...the quality is outstanding and the buildings are among the best of their brands worldwide but then again yeah it's not for everyone.

So thanks for the concern but someone who pays a billion for a building knows the in/out of managing a property profitably , not a skill set everyone would have in recent times

I said the population of the PRChina still doesn't know what a dish washing machine is and I referred to the small apartments most PRChinese live in which they erroneously call a house. There are very few free standing houses in the PRChina contrasted to nearly everyone in metro areas living in apartments.

The Wall Street Journal headline on this story was, "Hilton Tosses Waldorf to Chinese Insurer," which pretty much sums up the picture, which is that,

The grand though aged Waldorf needs a renovation, a task that will add substantially to Anbang's sticker price. Such an investment could be paid back with higher room rates or proceeds for the sale of rooms converted to condominiums. That Hilton itself preferred to skip the risk is a sign of the task ahead.

The Chinese buyers are paying $1.4 million per room for 1413 rooms when the going price in Manhattan is $1m.

Hilton Worldwide Holdings Inc has 27 Waldorf Astoria Hotels & Resorts to include in Beijing and Shanghai and is adding other destinations such as Bangkok and Bali. If Hilton had wanted to sink money in to the New York property it would have done so. Hilton instead will apply the take on this fast deal to the U.S. hotel market such as the coming soon Beverly Hills Waldorf Astoria.

China’s equities and property markets are stagnant so PRC insurance companies are going to where the value is, which is U.S. real estate. One could say Hilton saw 'em coming cause Hilton turned away two other suitors to sign this deal in no time at all..

As to the security aspect, here's what a NYPD source related to the New York Post .....

“The Chinese are very tricky. They are involved in snooping for proprietary reasons to gather intelligence on us and to gain an advantage in the capitalistic world we live in,” a law enforcement source told The Post. “They are trying to gain that advantage on us — and one of the major ways they’re doing this is by stealing our computer secrets.”

The Waldorf sale could open the door to a world of spilled secrets.

“A lot of important people who possess secret information stay at the Waldorf,” the source said. “That information could get into the hands of the Chinese now.”

http://nypost.com/2014/10/13/amid-security-concerns-us-eyes-sale-of-waldorf-astoria-to-chinese-firm/

I'm not sure the Treasury Department's Board of cabinet secretaries that review these things want to put the financial collar back around the neck of the Hilton group, but the security aspect just might force the decision in that direction. If the renovation plan simply changes how the president has to come and go at the hotel then the sale is dead in the water.

In financial debt/borrowing terms how much does america actually owe China ?

Happy to borrow money but not happy to sell property ?

Edited October 16, 2014 by Spoonman