An auction to sell off a New York hotel owned mostly by 1MDB-linked business person Jho Low failed to attract any substantial bids.

The New York Times, citing sources, reported there were no bids for the Park Lane hotel in Midtown Manhattan "or at least none that came anywhere near the US$1 billion the seller was looking for."

The Park Lane Hotel was put on sale after the US Department of Justice (DOJ) filed civil forfeiture suits to seize over US$1.7 billion in assets, including the hotel, that were allegedly purchased using funds siphoned from 1MDB.

Jho Low had bought a 55 percent stake in the 47-tower property.

His co-owners, including developer Steven Witkoff, and Saudi's Mubadala Investment Company, had come to an agreement to sell the building and split the earnings, with the US government taking Jho Low's share.

However, while potential buyers could be nervous about the DOJ's continued role in the property, those the New York Times spoke to cited other market factors such as bad timing and a softening market.

“I think it’s the world’s greatest site for development... The problem was timing” said hotel and hospitality group JLL director Jeffrey Davis.

Meanwhile, Chad Crandell, the chief executive of CHMWarnick a company which oversees hotels owned by Asian and Middle Easter firms, said: "No one wants to be the last to buy a hotel in this cycle."

“No one wants to be the last to buy a hotel in this cycle,” said Chad Crandell, chief executive of CHMWarnick, which oversees hotels owned by Asian and Middle Eastern companies, including Anbang Insurance, the Chinese company that paid $1.95 billion for the Waldorf in 2014.

“The whole transaction market has softened... There’s a lot of uncertainty.” Crandell added.

According to the DOJ, Low had used funds "laundered" through the Park Lane Hotel to purchase jewellery for Australian model Miranda Kerr.

Low's whereabouts are currently unknown, although his superyacht - which was also allegedly purchased with stolen 1MDB funds - was spotted in Aceh on Oct 23.