Part One

740 Park: The Story of the World's Richest Apartment Building
by Michael Gross

For seventy-five years, it's been Manhattan's richest apartment building, and one of the most lusted-after addresses in the world. One apartment had 37 rooms, 14 bathrooms, 43 closets, 11 working fireplaces, a private elevator, and his-and-hers saunas; another at one time had a live-in service staff of 16. To this day, it is steeped in the purest luxury, the kind most of us could only imagine, until now.

The last great building to go up along New York's Gold Coast, construction on 740 Park finished in 1930. Since then, 740 has been home to an ever-evolving cadre of our wealthiest and most powerful families, some of America's (and the world's) oldest money - the kind attached to names like Vanderbilt, Rockefeller, Bouvier, Chrysler, Niarchos, Houghton, and Harkness - and some whose names evoke the excesses of today's monied elite: Kravis, Koch, Bronfman, Perelman, Steinberg, and Schwarzman. All along, the building has housed titans of industry, political power brokers, international royalty, fabulous scam-artists, and even the lowest scoundrels.

The book begins with the tumultuous story of the building's construction. Conceived in the bubbling financial, artistic, and social cauldron of 1920's Manhattan, 740 Park rose to its dizzying heights as the stock market plunged in 1929 - the building was in dire financial straits before the first apartments were sold. The builders include the architectural genius Rosario Candela, the scheming businessman James T. Lee (Jacqueline Kennedy Onassis's grandfather), and a raft of financiers, many of whom were little more than white-collar crooks and grand-scale hustlers.

Once finished, 740 became a magnet for the richest, oldest families in the country: the Brewsters, descendents of the leader of the Plymouth Colony; the socially-registered Bordens, Hoppins, Scovilles, Thornes, and Schermerhorns; and top executives of the Chase Bank, American Express, and U.S. Rubber. Outside the walls of 740 Park, these were the people shaping America culturally and economically. Within those walls, they were indulging in all of the Seven Deadly Sins.

As the social climate evolved throughout the last century, so did 740 Park: after World War II, the building's rulers eased their more restrictive policies and began allowing Jews (though not to this day African Americans) to reside within their hallowed walls. Nowadays, it is full to bursting with new money, people whose fortunes, though freshly-made, are large enough to buy their way in.

At its core this book is a social history of the American rich, and how the locus of power and influence has shifted haltingly from old bloodlines to new money. But it's also much more than that: filled with meaty, startling, often tragic stories of the people who lived behind 740's walls, the book gives us an unprecedented access to worlds of wealth, privilege, and extraordinary folly that are usually hidden behind a scrim of money and influence. This is, truly, how the other half - or at least the other one hundredth of one percent - lives.

Chapter 1

At the end of the Roaring Twenties, small conspiracies of the powerful - many of them members of high society - formed investment pools to manipulate stock prices. Among them was Albert Wiggin, the chairman of the Chase National Bank. In 1927, business was booming when President Calvin Coolidge declared that America was "entering upon a new era of prosperity." That March, pool operations peaked, as did Cadillac sales in New York City. In May, trading volume hit a new high. Brokers' loans to speculators shot up to $4.4 billion at interest rates of between 10 and 12 percent. Then, on June 13, 1928, the stock market collapsed. It quickly recovered, but the plunge was a sign - one that few people read.

The market cratered again on March 26, 1929, sending interest rates on loans to speculators soaring to 20 percent. But loans were still being made; it seemed that nothing could end the mad speculation. The Federal Reserve Board urged bankers to stop handing out money. Immediately, one bank announced a fresh $20 million available for loans - and the stock market recovered again.

"In such circumstances, one might have expected bankers, at least the most important, prestige-laden, and supposedly conservative among them, to lie low, to accept quietly the profits that flowed to them so effortlessly," John Brooks wrote in Once in Golconda, his classic tale of Wall Street's ruination. Instead, men like Wiggin were anything but circumspect. Through holding companies formed to conceal trades and minimize taxes, he played the market, frolicked in pools, and even speculated in Chase stock to the tune of millions of dollars. Only in the summer of 1929 did he start to worry.

Though the economy was showing signs of weakness, the stock market was still soaring, volume hitting records, new fortunes being made. On September 3, the market's averages hit all-time highs - highs that would stand for the next twenty-five years. Though he kept touting Chase stock, Wiggin also started selling it short - borrowing forty-two thousand shares and selling them, expecting to buy them back later for less - effectively, dishonorably, despicably, really, betting that his own company's market value as set by the price of those shares would drop! Which it did. Then he bought the shares back with a loan from Chase.

That's when the house of cards fell in. Stock prices started dropping on Wednesday, October 23 - and the next day, later known as Black Thursday, they collapsed. A third precipitous plunge followed on October 29 - it would be known as Black Tuesday. Get the feeling things were black? John D. Rockefeller and his namesake son, who was called Junior, tried to brighten the outlook by announcing that they, at least, were buying stocks, but their virtuous stand had no effect on the economy. Within a few weeks, $30 billion worth of equity - more than a third of the market's value - had vanished. The Great Depression was on.

A year later, apple sellers appeared on street corners for the first time. In December 1930, the Bank of the United States closed its doors - the most significant in a wave of failed financial institutions. By 1931, stock prices stood at less than half their 1929 highs. Unemployment rose in inverse proportion. In just two months in the fall of 1931, another eight hundred banks went belly-up. Building ceased. Life went on, if barely, for most.

And what of Wiggin of the Chase? After the crash, he toted up winnings of just over $4 million for selling his company down the river - profits he hid offshore to avoid taxes. That said, his dealings were not only legal but perfectly respectable - at least according to the era's business mores. After Wiggin retired in 1933, the bank awarded him an annual pension of $100,000 for life. But that same year, when he was hauled before a Senate banking investigation, he "asked" the bank to stop the payments, a request with which it "complied," according to The Wall Street Journal's 1951 obituary. Wiggin nonetheless managed to leave a $3 million estate.

History has judged him more harshly, even as it has repeated itself. "[Even if] they had done nothing actually criminal, [they] had treated their own stockholders and the investing public as so many sheep to be fleeced by whatever means the ingenuity of accountants and lawyers could devise," wrote the stock market historian Charles Morris.

This is the backdrop as the curtain rises on the story of the most prestigious apartment house in the world, 740 Park Avenue.

Copyright © 2005 by Michael Gross.

About the Author

Michael Gross has written for Esquire, Vanity Fair, Town & Country, and countless other publications. Currently a contributing editor at Travel & Leisure, he is also the author of Genuine Authentic and the New York Times bestselling Model. He lives in New York City.