For decades, New York’s Friars Club, the seat of American comedy and legendary roasts, has made its home in a landmark building on Manhattan’s East Side. That era appeared to end on Tuesday, not with a punchline and a rimshot, but with a foreclosure auction in which the club’s townhouse was sold to a creditor for $17.2 million.
“Going once, going twice,” the auctioneer called out on Tuesday outside Federal District Court in Manhattan, where a dozen or so people had gathered to find out the club’s fate. There were no other bidders.
With the smack of the auctioneer’s hand on his legal pad — there was no gavel — the sale passed ownership of the Friars Club’s six-story townhouse on East 55th Street to a California loan company.
The auction capped the yearslong decline of the storied comedy institution that had been a main haunt for the likes of Frank Sinatra, Ed Sullivan and Milton Berle. Hobbled by a flood and the pandemic, the club started missing payments on its $13 million mortgage last year, and the loan company moved to foreclose.
There were times when the institution’s leadership was hopeful that someone would step in to buy the building and revive the comedy institution, but nothing panned out ahead of the auction.
Arthur Aidala, the club’s last dean before it closed, who has tried to lift it out of crisis in recent years, said he continues to be hopeful that some plan will come together that could work to keep the Friars Club at the Friars Club.
“We are pleased that no bidder came to purchase the historic Friars Club building today,” he said. “It is still the hands of the lender, which gives us the opportunity to purchase it back and recreate the Friars Club with a new group of enthusiastic and experienced investors.”
The sale includes not just the building but the contents inside, including memorabilia, fitness equipment and old liquor bottles and glassware left from its days as a watering hole for Manhattan’s showbiz elite.
Because the exterior of the building has landmark status, the club cannot be torn down to make room for another of the glassy skyscrapers in its vicinity. But the buyer has full control over the interior, which includes rooms named after Barbra Streisand and Joe E. Lewis, a dining room known as The Monastery, offices and a fitness center.
For many of the once-devoted members of the Friars Club, who relished the raunchy celebrity roasts and the proximity to fame, the club’s demise has been drawn out over many years.
The club, a nonprofit corporation, lost its tax-exempt status in 2010. It received criticism for its spending on low-net charity events. Federal agents raided its offices in 2017 as part of an inquiry into its finances, and its director at the time, Michael Gyure, pleaded guilty to having filed false personal tax returns. The club remains locked in a civil dispute with Gyure that began after the club’s board fired him.
A flood in 2020 shut down the club, and that crisis was quickly followed by the devastation of the pandemic.
By 2022, there were only a couple of hundred dues-paying members — far below the roster of 2015 or so, when paid membership numbered more than 1,000.
But the bills kept piling up, and up, and up. After the club closed for the summer of 2022, as usual, it was not financially stable enough to reopen that fall.
The troubles became more serious the next spring, when the club was sued by Kairos Credit Strategies Operating Partnership, which said that the club was behind on mortgage payments. The company demanded that the club pay its $13 million in debt. But, it no longer had the money to do so.
In October, a federal judge declared that the club owed the loan company $18.6 million, including the debt, interest, legal expenses and other fees.
When the building was put up for auction, it was advertised as a “vacant landmark private club with conversion potential.” According to the brokerage firm, possible uses included a single-family mansion, an embassy or consulate, a high-end restaurant, a boutique hotel or a cigar club.
But when the sale came on Tuesday, no one else put in any bids, leaving the property to the loan company.
Mr. Gyure was among the observers there to see the building sold and said he was hopeful that the company would agree to resell it to someone interested in maintaining the institution.
“This is just another part of its evolution and history,” he said.
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