Howard Lutnick, the Pierre Hotel and Claims of a Secret Plan

For nearly a century, the Pierre has stood as a symbol of opulence overlooking Central Park. Inspired by the Palace of Versailles, it was home to some of the most wealthy and powerful people in one of the most gilded ZIP codes in America.

But by 2023, its stately carpets were fraying, the elevators were breaking down, and the front desk often stood empty. In the minds of its well-heeled residents, the Pierre was falling apart.

Then, a relative newcomer to this landmark on New York’s Upper East Side brought hope to his disgruntled neighbors with an idea for fixing up the place. Howard Lutnick, the owner of the Pierre’s penthouse and a billionaire who would soon become President Trump’s commerce secretary, urged the co-op’s board of directors to hire a new manager for the building.

As it happened, Mr. Lutnick at the time ran Newmark Group, a real estate firm, which the board soon retained for advice on how to revamp the property.

The board, under the guidance of Newmark, has reached the final stages of negotiations to sell the Pierre for roughly $2 billion. The Khashoggis, a prominent Saudi family, would provide at least some of the funding for the purchase, while the Dorchester Collection, a luxury hotel company owned by the sultanate of Brunei, would most likely manage the building after an extensive renovation, two people familiar with the deal said.

If this sale happens, all of the Pierre’s residents could be forced to move out, including Michael Eisner, the former chief of Disney; Tory Burch, the fashion designer; and Shari Redstone, who recently sold her company, Paramount. Princess Firyal of Jordan also owns an apartment there.

“I am an 84-year-old widow with no family and have just redone my apartment at great expense,” Tina Beriro, who has lived in her apartment overlooking Central Park for two decades, wrote in one message. “To find new accommodations and go through the trauma, exhaustion and money involved in a move would seriously affect my health, well-being, and finances.”

The Pierre is a rare breed of co-op. It has a mix of both permanent residents and overnight guests, who can book a room for the night or host a wedding in one of its grand ballrooms or rotunda.

Permanent residents get the same daily housekeeping, room service and other amenities as hotel guests. Over the years, glamorous figures like Elizabeth Taylor, Audrey Hepburn and Coco Chanel have lived or stayed at the Pierre.

Any sale must be put to a vote by the apartment owners, who are allotted shares in the co-op that correspond partly to the sizes of their units.

If two-thirds of the shares are cast in favor of the deal, even those opposed could have to sell their homes. With the largest apartment, Mr. Lutnick has more shares than anyone else — and therefore holds the most sway.

Yet Mr. Lutnick, 64, hasn’t weighed in on the group emails, nor did he appear at an unruly online meeting in July. He has been busy as a chief promoter of Mr. Trump’s plans to impose tariffs on U.S. trading partners, including a significant one on Brunei.

Benno Kass, a spokesman for the Commerce Department, said Mr. Lutnick had not been involved in the sales process for many months. He is focused on his work in the Trump administration and not aware of the details of the current offer, Mr. Kass said.

Still, Mr. Lutnick has remained a specter looming over the chaos at the Pierre — the one who residents believe set in motion the drama that has put their homes at risk.

It’s been an intense summer of politicking around the building. Opponents have worked behind the scenes to derail the sale. Supporters have cast it as a choice between making huge profits selling their apartments or spending millions of dollars each to upgrade the building.

The fight is expected to come to a head on Wednesday at the building’s annual meeting in the Pierre’s Cotillion ballroom.

In a statement, a spokesman for the Pierre’s board said that its directors had a fiduciary responsibility to consider “any option to enhance the building’s infrastructure and operations, and maximize value for shareholders.”

“When appropriate, the board presents these opportunities to shareholders for their consideration, and ultimately their approval or disapproval,” the statement said.

As they wait to learn the fate of their co-op, residents pass portraits in the lobby of Andy Warhol and Sophia Loren at the Pierre in grander days and sip $45 cocktails at its dimly lit Art Deco-style bar.

And they ride the bumpy wood-paneled elevators, when they are in service. On sweltering days this summer, one of the elevator operators set up a portable fan inside.

Parties in the Penthouse

Long before Howard Lutnick owned an apartment there, the Pierre played a role in a defining period of his life.

On Sept. 11, 2001, the terrorist attack on the World Trade Center killed 658 employees of the bond trading firm Cantor Fitzgerald, where Mr. Lutnick was chief executive. He was not there that morning, but his brother, Gary, died.

A childhood friend, Arthur Backal, then an executive at the Pierre, offered a banquet room as a makeshift support center for the relatives of Cantor employees.

“He felt really responsible for taking care of all these families,” Mr. Backal said.

Over several days at the Pierre, Mr. Lutnick hugged victims’ relatives and wept in televised interviews.

As the city slowly recovered, Mr. Lutnick rebuilt Cantor, bigger than it was before.

He returned to the Pierre 16 years later. This time, he came for a bargain.

The Pierre penthouse, with 16 rooms and four terraces on the 41st and 42nd floors, was on sale at an incredible discount. Martin Zweig, a finance guru who predicted the 1987 stock market crash, owned the space with his wife, Barbara, and had decorated it with mannequins dressed in suits once worn by the Beatles.

After her husband died, Ms. Zweig, 68, put the penthouse up for sale in 2013 for $125 million. It didn’t sell, so she slashed the price repeatedly; Mr. Lutnick scooped it up for $44 million.

Co-ops became popular in New York as a way for apartment dwellers to have control over their buildings, including setting the rules and controlling who lives there.

At the Pierre, the penthouse came with 6 percent of the co-op’s 129,000 shares.

Mr. Lutnick already owned property in the Hamptons, a condo on the ocean north of Miami Beach and a townhouse on the Upper East Side.

He planned to host parties at the penthouse, according to a person who spoke with him. He installed a basketball court in the apartment, popping by for workouts with his trainer, the person said.

‘Second-Rate Furniture’

While the Pierre may be a trophy home to some, others planned to live out their old age there.

Paul and Rodica Burg, chemists who emigrated from Romania and have been married 64 years, bought an apartment there three years ago on a high floor. He is 92, and she 87. They are near their social club, synagogue and daughter.

“We want to stay here until we die,” Mr. Burg said in an interview.

But conditions had deteriorated by late 2023 to the point where the building’s old guard, many of them in their 80s and 90s, demanded change in complaints to the board and in group emails.

“The hotel when we moved in 43 years ago was a proud edifice,” wrote Irwin Winkler, 94, who co-produced “Rocky” and “Raging Bull.” He expressed doubt that Taj Hotels, the current operator, could turn things around.

The “lobby is shabby” and “the furniture, second rate,” he wrote.

Taj, which operated the Pierre’s hotel rooms and managed the property, undertook a $100 million renovation after becoming its operator in 2005, but has since lost many millions running the building, according to its corporate reports. The previous operator, the Four Seasons, reported losing millions as well.

In a statement, a spokesman for Taj said the company had invested millions in enhancing the Pierre over the years and called the building a “beacon of uptown elegance.”

But for tens of thousands of dollars in monthly maintenance payments, the residents expected usable elevators. On a day in October 2023, one was out of service and a person was trapped inside another, a resident who had to take the stairs complained in an email.

“I, too, have been using the dirty stairs, as the wait for the elevators is so long,” another replied.

Ms. Zweig, who had sold Mr. Lutnick the penthouse and moved into another apartment in the building, recounted her failed effort to obtain change of a $100 bill at the front desk.

“I can’t imagine booking what I assume to be a luxury hotel and finding often empty front desk/concierge/security areas and broken elevators,” Ms. Zweig wrote in a group email.

“Well said,” Shari Redstone, 71, responded.

Hiring Mr. Lutnick’s Firm

The complaints had reached a crescendo when Mr. Lutnick stood up at the Pierre’s annual meeting for co-op owners in September 2023 and called for changes.

“He promised the best Pierre ever,” Ms. Beriro recalled.

Near the start of 2024, residents received a note from Michael Stern, 87, the board’s chair, and David Johnson, 68, its president, saying Newmark had been hired, and would meet with Taj and seek ways to improve “the condition and operation” of the Pierre. The board would later tell shareholders that it had interviewed several firms before picking Newmark.

On its face, Newmark was a reasonable choice. The firm advised some of the world’s biggest property owners.

But in announcing the move, the directors did not mention that Newmark was run by Mr. Lutnick, the building’s largest shareholder.

But into the first few months of 2024, a much smaller circle — Mr. Lutnick, Mr. Karatz and Mr. Johnson — began working with Newmark on potential changes at the Pierre, according to four people briefed on the matter.

After months of discussions, the group quietly concluded that Taj was unwilling to invest enough money to address the building’s many problems, according to communications reviewed by The Times.

So Newmark and the board’s representatives began to explore another possible solution: selling the Pierre itself.

Through the summer of 2024, Newmark earned nearly $100,000 in monthly fees as a consultant, according to one of the communications and a person familiar with the arrangement. From that point, as the firm marketed the Pierre to potential buyers, Newmark stopped taking monthly fees and would be paid only by a prospective commission, the person said.

Residents heard nothing for months. Their first clue that something was afoot came in October 2024, when Mr. Johnson and Mr. Stern, the board’s top leaders, wrote to inform shareholders that Newmark would now help “in determining the future of the building.”

The letter did not reveal what that might entail, but added cryptically — and ominously, to some — that Newmark could “effectuate the ultimate transition.”

Mr. Lutnick by now had withdrawn from discussions about the Pierre, said Mr. Kass, his spokesman. Mr. Trump picked him to lead the Commerce Department shortly after the November election. The next month, he bought a $25 million home in Washington.

At the Pierre, residents began digging for information. They soon learned from people with direct knowledge of the talks that Newmark had found a possible buyer for the building.

The Khashoggi family, relatives of the journalist Jamal Khashoggi, who was murdered and dismembered in 2018 on orders from the Saudi crown prince, would provide funding for the purchase, according to two people briefed on the terms.

And the Dorchester Collection is expected to manage the property, the people said. Dorchester is owned by Brunei, a tiny Asian country ruled by Sultan Hassanal Bolkiah. One of the world’s richest men, the sultan oversees a $73 billion sovereign wealth fund that has invested in luxury hotels. He has also embraced hard-line Islam, enacting laws making adultery and gay sex punishable by stoning.

A spokesman for Dorchester said neither the company nor the sultan had a contract to operate the Pierre, but would be interested “to have a property in New York should the right opportunity arise.” Representatives for the Khashoggis could not be reached.

In private conversations with directors around the beginning of this year, some Pierre residents were told how they might be affected by some of the contemplated changes.

In one possible scenario, revealed by Mr. Stern and Mr. Johnson in a letter to residents in March, the “potential operator,” whom they did not name, might concentrate hotel rooms on lower floors and try to relocate residents to upper floors, after extensive renovations.

The directors did not yet acknowledge another scenario that residents were beginning to fear: a purchase of the whole building, requiring them to move out for good.

It all seemed fluid, secretive and, for some, frightening.

“I fear we are, at the moment, acting on almost no information,” Ms. Beriro wrote to neighbors. “Under what conditions can a new owner kick out owners of a building?’’

As opposition to a sale hardened through the spring, Mr. Lutnick became the target of residents’ ire.

Ms. Beriro and others accused the commerce secretary of seeking to profit from a financial deal with real-life consequences for others. Hiring Newmark “was a blatant conflict of interest,” Ms. Beriro wrote to the board in June.

The board has said there is no conflict because Mr. Lutnick disclosed his interest in Newmark and did not take part in the decision to hire the firm, according to a private communication The Times reviewed. His spokesman also said that Mr. Lutnick wasn’t involved when the board found the buyer currently offering to purchase the Pierre.

Mr. Lutnick stepped down from his roles at Cantor and Newmark in February upon his confirmation as commerce secretary, but his family members retain stakes there. He sold his stock in Newmark back to the company and transferred his ownership interest in Cantor to his two adult sons, who hold leadership roles at the companies.

While commissions on high-value deals can vary, Newmark could earn tens of millions of dollars on a $2 billion sale, industry experts said.

A Tight Vote

In late July, the Pierre’s board called an emergency meeting on Zoom. They offered few specifics, but directors and consultants made the case for a sale, portraying the building’s condition as dire. Restoring it could be astronomically expensive, they said, requiring people to move out for a time anyway.

With none of the residents muted, the call quickly devolved into a morass of heated questions, speeches and interruptions, three people who attended said.

Lois Chiles, 78, a model and actress who became famous in the 1970s, lamented about renovations she had done without knowing she might have to leave.

Tory Burch, 59, the fashion executive, spoke of how much she loved her apartment, whose velvet walls and autumn-hued living room she showed off in a British Vogue spread.

As Mr. Eisner pleaded with others to wait for an actual proposal, people talked over him.

At Wednesday’s co-op meeting, shareholders are expected to hear a presentation about the proposal to sell.

Taj has defended its stewardship of the building and submitted its own proposal to make upgrades, which the company said would not entail residents having to move out.

In the event a sale is indeed approved, the co-op would most likely have to pay off significant liabilities — such as its mortgage, pension obligations and other costs — before dividing proceeds among apartment owners based on how many shares they hold.

If divided up that way, the largest slice would go to the biggest shareholder: Howard Lutnick.

Anupreeta Das contributed reporting, and Susan C. Beachy and Kitty Bennett contributed research.