Private equity firm Northwood, who purchased New York Palace hotel in summer 2011, is planning to invest $100m to renovate the property, located at 50th Street and Madison Avenue, New York City, US.
The project aims to modernise all of the hotel's 900 rooms, reports USA Today.
The company plans to begin work this summer on the unit's 176 Towers rooms and suites - the hotel's highest-priced and largest rooms that start at 600ft² - while work on rest of the unit's guest rooms will begin next year.
According to the firm, the Towers rooms have been designed as a 'hotel within a hotel' with their own private entrance and a private club for the celebrities, royalty and other VIP visitors who frequently stay at the hotel.
Northwood Hospitality president David McCaslin said the company would work to restore guest rooms back to Five Diamond status.
"Since we have over 900 rooms, the hotel can operate very normally as we are just doing certain floors," added McCaslin.
Northwood has hired San Francisco-based firm BAMO to design the guest rooms.
The New York Palace will be operated under the same name following the renovation and Northwood isn't planning on affiliating with any multinational brand to help promote it.
In 1980, New York developer Harry Helmsley and his wife Leona opened the property as the Helmsley Palace.
Caption: The New York Palace combines the Villard Mansion with a 55-storey modern tower. Image: Americasroof.