Housing Notes: The Sherry-Netherland Once Blazed
A little history
When the Sherry-Netherland opened on November 1, 1927, the 560-foot tower was hailed as the world’s tallest apartment hotel. The Sherry-Netherland combines the name of Louis Sherry, the celebrated New York restaurateur and confectioner, with the name of the hotel it replaced: the Hotel New Netherland. It is not named for sherry wine or for the Netherlands in a general cultural sense. Schultze & Weaver designed the building (they also designed the Waldorf Astoria, The Pierre, and the Breakers in Palm Beach).
According to the New York Times, on the night of April 12, 1927, a spectacular fire broke out in the wooden scaffolding surrounding the upper tower of the nearly completed Sherry-Netherland. The 1927 article is a very fun read (gift link). I include two paragraphs below.
New York was thrilled last night by the most spectacular fire it has seen in many years when the scaffolding in and around the 15-story tower which tops the 23-story main building of the luxurious new Sherry Netherland Apartment Hotel at Fifth Avenue and Fifty-ninth Street blazed for hours with no possibility of control. It was the first real skyscraper fire the city has had since the famous Postal Telegraph Building burning in 1898. While awed crowds watched from every vantage point, blazing timbers from the nearly completed tower showered the streets or fell, a serious menace, to the roofs of near-by structures.
Firefighters could not direct enough water to the height of the blaze, which continued to challenge the future development of high-rises during that era. Despite the fire, the Sherry-Netherland opened later that year. More from the 1927 New York Times article (gift link).
The damaged building is on the site of the old Netherland Hotel and was sold recently by the Ninety-sixth Street and Fifth Avenue Corporation to the Sherry-Netherland Company, a subsidiary of Louis Sherry, Inc., which in turn is a subsidiary of the Boomer-du Pont interests. It was to be opened on Oct. 1 as one of the most luxurious dwelling places in the city, with a great entrance hall designed on the lines of a great Florentine palace. Every door is to have gold-plated knobs and the bathroom fixtures are to be of silver. Its new owners recently announced that the construction and operation of the structure involve a capital of $10,000,000. In architecture it is an adaptation of Italian Renaissance, suggesting the Romanesque in some features. The total height of the building is 559 feet, four feet higher than the Washington Monument. The architects are Schultze & Weaver, and the builders the Schroder-Koppel Company. Construction was begun last September.
Situated at 781 Fifth Avenue on the northeast corner of 59th Street, on the southeast corner of Central Park. About a decade ago, I inspected the penthouse, which was a lot of fun. I’ve done quite a few apartment appraisals within the building over my 40-year career. But even with sales data available publicly since 2006, when co-op sales became a matter of public record (going back to 2003), it remains challenging to get current, detailed information on the building.
Sales prices have been softening… a lot
The chart below reflects the average sales price for each year at 781 Fifth Avenue (Sherry-Netherland) since 2015. The New York Post story focused on how rapidly prices are dropping in the building, as shown in the table below. This is in stark contrast to a flat-to-rising pricing environment in Manhattan.
The Sherry-Netherland co-op falls within a New York City housing category that is especially hard to understand. They’re known as “hotel co-ops,” which tend to have very high monthly maintenance charges but include varying levels of hotel services. This submarket has a few condominium units, but it is best known for its co-op addresses listed below, which average about triple Manhattan’s average maintenance per square foot.
Early in my career, real estate agents who successfully sold in these buildings said many buyers who favored the financial conditions came from Central and South America. I never got more specifics about that market pattern.
Here are some current active listings within the building.
What is especially fascinating about apartment 304/310 is that it was purchased for $11,100,000 in 2011 and is currently on the market for $1,600,000, with $32,296 in monthly maintenance. Ouch. I told the New York Post that if it sells, it:
will be the largest loss on an individual residential sale on record in New York City. Nothing comes close to $50 million.
Monthly maintenance charges have accelerated sharply upward over the past 5 years. While this doesn’t really explain the recent surge, the following are some of the reasons for the unusually high monthly charges:
- Twice-daily housekeeping, daily linen changes, turndown service, and dry-cleaning logistics.
- Concierge, bellhops, elevator attendants, and on-site engineering staff around the clock.
- Room service partnerships (historically with Harry Cipriani on the ground floor) and hospitality overhead.
Final Thoughts
The Sherry-Netherland is one of a handful of Manhattan co-ops with hotel services. Fronting Central Park and its spectacular park views, it has long been known for its hotel services, but also for high monthly maintenance charges that have risen significantly over the past five years. Rising costs are disrupting pricing, despite a buyer universe of all-cash buyers.
The Actual Final Thought – Yes.
