Famed fashion designer Tommy Hilfiger’s plan to convert Manhattan’s landmark Metropolitan Life Tower into a luxury hotel may have hit a snag.

Hilfiger last month reportedly had a contract in place to buy the 112-year-old tower that overlooks Madison Square Park from owner Africa Israel USA for US$170 million. But Hilfiger and his partner in the deal, JSR Capital, still have not closed on a loan to pay for conversion of the 700-ft. building, now known locally as the Clock Tower.

An Africa Israel spokeswoman tells the Wall Street Journal that talks are ongoing to sell the property, “including with the party that has signed the contract.” But Manhattan real estate observers expected the deal to have proceeded further by now, and the reasons for the slow movement remain unknown publicly.

If the project does move forward, it would be Hilfiger’s first foray into hotelkeeping as a principal. His fashion company, which was recently acquired by Phillips-Van Heusen Corp. for about US$3 billion, would not be involved in the hotel project.