NEW YORK - In this city's super-competitive hotel business, marketing gurus are always looking for an angle, a special amenity that will draw hordes of guests -whether it's proximity to Central Park, upscale shopping or five-star dining.

As it emerges from a multimillion-dollar renovation, the historic Algonquin Hotel is betting that literary nostalgia and a $10,000 martini will do the trick.

It was here, near New York's theater district, that America's famous literary salon was born 85 years ago. What started as a serendipitous lunchtime gathering of young writers came to be known as the Round Table, a chummy midtown watering hole featuring Dorothy Parker, Robert Benchley, George S. Kauffman, Edna Ferber, Alexander Woollcott, Harpo Marx and other American celebrities in the 1920s.

The Algonquin "has had more famous writers in its lobby than you'd ever believe," said Hank Lyons, a bellman for 45 years. "But we had to bring the place up to date."

Indeed, the ghosts of writers and actors fill the hotel's oak-paneled lobby. Over the years, the Algonquin has been a major attraction for literati touring New York - with plaques in the lobby, walking tours of the neighborhood and musical revues saluting the scribes who held court there.

But is nostalgia enough to boost the fortunes of an establishment that must compete with three other hotels on West 44th Street and cannot offer the amenities of larger, more lavish rivals?

For decades, the Algonquin has been known primarily for its bustling lobby. Its 174 guest rooms and suites, however, were another matter. Magazine critics and tourists writing online reviews complained that the quarters were small, old and stuffy. The "Gonk,"as Parker dubbed it, began to fall out of favor.

So the hotel's owners, Denver-based Miller Global Properties, recently spent $3 million to renovate the building.

They are gambling that this upgrade, coupled with a marketing campaign based on nostalgia, will breathe life back into the Algonquin.

"There was quite a playground here in this hotel 85 years ago,"said general manager Anthony Melchiorri, sipping tea in the lobby.

"What we're trying to do now is bring back the excitement - for anyone who ever loved the history of this place, and for people who want to feel that the literary world, the world of writers, still lives on here," Melchiorri said.

He said that Harold Ross, founder of the New Yorker magazine, rounded up seed money for the first issues at the Algonquin bar in 1924; William Faulkner wrote his 1950 Nobel Prize acceptance speech upstairs; and the Broadway team of Alan Jay Lerner and Frederick Lowe penned My Fair Ladyin Room 502. In the 1970s, novelist Mario Puzo signed contracts in the lobby to turn The Godfather into a movie. To keep that spirit alive, the Algonquin wants to lure a new generation of writers.

The owners plan to offer a 10 percent discount on the lunch and dinner menu to any writer who presents a business card or a manuscript in progress. There will be regular readings of plays by dramatists, literary award ceremonies in the lobby and what Melchiorri described as an "interactive" version of the famous Round Table.

He says visitors will find a cast of actors seated at the most recent version of the table - the original disappeared years ago - who will assume the roles of Parker, Benchley and others. Guests would be invited to discuss anything, from books and magazines to the latest celebrity gossip and news events.

And, yes, there's the $10,000 martini, a nod to Parker's famously decadent tastes. It's called "Martini on the Rock" and customers who order it must make an appointment in advance with a jeweler. The drink is poured over their gem of choice; officials noted that $10,000 is only the starting price, depending on customers' taste.

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