Last Friday, Gene London stood before the folding table-turned-cashier’s stand in the back lobby of the Gramercy Park Hotel with the stunned look of luck in his eye. An actor in his early 70s who lives in the neighborhood, he was the new owner of four old wall sconces ($125 apiece), still bolted to the wall. To his left, a man dug through a wastebasket full of brass doorknobs ($10 each). “Those doorknobs have the most beautiful locks – Tiffany quality,” Mr. London confided. Down the hall, stray shoppers strolled as if in a daze among stacks of ceiling fixtures ($15) and metal luggage racks ($5), towel bars ($2) and TV stands ($10), rose-colored ottomans ($125) and metal room safes ($25).They were there for the hotel’s public sale of its contents – furniture, lighting, fixtures, and accessories – which began two weeks ago.

Ever since, the curious and the acquisitive have been swarming all 18 floors of the 120-room annex – the back portion of the hotel – and dismantling the cherished landmark sconce by sconce. “There were people on the sidewalk pressing their noses against the windows,” said Frank Long, president of the Ohio-based company in charge of what is billed as a liquidation sale but feels more like an historical event. At stake, however, is more than the loss of a piece of New York history: when the Gramercy as we know it goes, so goes one of the city’s last remaining unstylized oases – bringing us that much closer to living in a wholly high-design world.

For decades, the fabled New York institution shambled along as a shabbily elegant, family-run operation with quirky celebrity appeal and reasonable room rates – an anomaly in an ever-swelling sea of boutique chic. Its decor, a cozy amalgam of standard-issue furniture and the dust of yesteryear, evoked less a particular era – in the manner of the Algonquin or the Plaza, say – than some amorphous, bygone heyday, where the ghost of a pre-famous Humphrey Bogart rubbed elbows with an 11-year-old JFK.

But after the scandal-shrouded suicide in 2002 of longtime owner Herbert Weissberg’s son, the family ended its half-century reign and sold the 350-room hotel to financier Stephen Greenberg; last fall, high-end hotelier Ian Schrager swept the property into his fold with visions of joining the latest vogue: residential apartments. “I see residential apartments as a new genre,” he told Women’s Wear Daily in October, “something that blurs the distinction between a hotel and apartments.” He seems to be onto something: scores of hotels, among them the Plaza and Ritz Carlton, are following suit. But before the Gramercy can become a sign of the times, it must let got of its past – literally.

The frenzy began modestly, so modestly, in fact, that unless you had a sharp eye on the sidewalk, you might have missed it completely: on January 7, after a week of furious backstage preparations – cataloging, tag-affixing, a 5,000-card postcard mailing – International Content Liquidations, Inc., scattered a crop of red-lettered placards outside the hotel:

PUBLIC SALE
Gramercy Park
Hotel Contents
2 Lexington Ave.

and opened for business. Everything the eye could see was good for the taking – from ornate chandeliers and velvet banquettes to table lamps and wastebaskets, right down to the bathroom sinks and hard wood floors, even the mail chute – and priced to move.

“Phase One” of the liquidation sale is scheduled to run through January 28, and on February 3 an even bigger, better sale will begin – the entire contents of the hotel’s main building, which is rumored to include not only all of the aforementioned furnishings, but marble fireplaces as well.

“It’s an incredible opportunity to find the old alongside the new,” said Mr. London.

Indeed, the Gramercy’s failure to create a distinctive style is exactly what favors its cannibalization: while the Cobalt Club was special – to walk into the mirrored cavern and settle into one of its cobalt banquettes was to slip right into the 1940s – like the only gussied-up house on an otherwise-humdrum block, the club suffered by association. The other ground-floor lounge (intact until Phase Two of the sale), furnished with clusters of slightly uncomfortable brocade armchairs and gilded mirrors, calls to mind a Merchant Ivory set gone awry, though charmingly. The hotel’s rooftop was glamour waiting to happen, but between the Astroturf and the deck furniture, the High Bar felt more like a misguided experiment in suburban living. The rest of the hotel was merely drab; hence, its traditional, homey furnishings are suitable to most any apartment.

Last Friday afternoon, the Cobalt Club was packed not with cocktail chatter but the hotel’s detritus: ceramic and crystal table lamps ($5-$25), efficiency refrigerators ($30), Philips 19″ TVs (marked down from $65 to $49), bad hotel art in frames ($5-$20). The only evidence that, just two weeks prior, a crowd of revelers had been there to ring in the New Year was a strand of red plastic beads hanging from a crystal wall sconce ($250). Other details – a massive gold-painted wall hanging shaped as a fan ($400) and two decadent crystal chandeliers ($500) – hinted at the room’s recent past, but its trademark banquettes, previously owned by Karl Lagerfeld, had all been snapped up by the owner of an allegedly massive downtown loft for several thousand dollars.

Upstairs was no different. Grim weather kept the crowds at bay that day, but even so, the cluttered halls were busy with wayward shoppers opening drawers or gazing out multipaned windows onto the park. One week into the sale, the picked-over rooms appeared more heroin-chic than shabby: Room 925 was empty save for a Gideons Holy Bible and a 2005 nightlife guide on the carpeted floor. Room 725 held a stripped bed bearing a lone plastic party hat. The fourth floor was completely gutted. The third floor, however, was rich with treasures. Marble-topped nightstands ($65) crowded room 328; next door, in room 327, was a fleet of delicate dark-wood desks ($25); room 325 boasted an assortment of dining and armchairs ($5-$55).

One woman herded three rolling chairs onto the elevator. “How are you going to get them home?” Mr. Long asked. “Push them down the sidewalk,” she said. (The Oak Leaf Moving Company appealed to those forced to travel longer distances by way of taped-up fliers.) According to Mr. Long, aside from the cobalt banquettes, other big-ticket items were the mail chute (asking price $2,000) and the paneling in the lobby ($1,200). The hottest were the table lamps and the marble topped nightstands.

In February, once Phase Two of the sale is over, the hotel’s heavy doors will close for a while. They’re scheduled to open again next winter – the hotel’s 80th birthday – by which point the building’s 350 units will have reportedly been transformed into one 185-room hotel with an adjoining block of 23 residential apartments. Mr. Schrager is known for hiring trend-setting designers, such as Philippe Starck, who created the sleek look of the Royalton, on West 44th Street, and the Paramount, on West 46th Street. For the Gramercy’s redesign, Mr. Schrager has hired the London-based architect John Pawson, known for his minimalist style, whose last Manhattan creation, Calvin Klein’s flagship store on Madison Avenue, is a temple of stark lines. It happens that the hotel sits just outside the boundary that protects the Gramercy Park Historic District, so there’s no telling what the makeover will look like.

When they were done browsing, customers brought their purchases downstairs to the cashier’s desk in a portion of the lobby papered with a curious and cheeky design: a repeated pattern that includes a lingerie-clad woman sitting in a martini glass, and a bandit-eyed bug. There, Ohio natives Vinnie and Karen stuck each item with a “sold” sticker and conducted the transaction. At their elbows were a stack of Cobalt Club menus ($20), which, the cashiers reported, were popular among neighbors with a nostalgia streak. All in all, the casual and pleasant send-off seemed an oddly appropriate denouement to an eccentric slice of history.

Public Sale until January 28 at the Gramercy Park Hotel, 2 Lexington Ave., Monday through Friday, 9 a.m. to 6 p.m. and Sunday 9 a.m. to 5 p.m; for more information, call 212-475-4320.