June 29, 1912





RECORD  AND   GUIDE





1395





THE WISDOM OF A SKYSCRAPER SPECIALIST





A Professional   Talk   to   Real   Estate   Men   on   Latter-Day
Methods—Suburban Development and Building  Management*





By GEORGE T.  MORTIMER, Vice-President of the U. S. Really and Improvement Co.





THIS profession has grown witli
marked rapidity during the past
decade; in fact, the 'growing tendency of
the public to avoid Wall street and its
p-itfalls a few years ago brought about
a speculation in real estate which was
almost of the "wildcat" variety. The
entire United States was plotted until
farmland became so scarce that necessity,
in rectifying the evils which were brought
ahout. has begun to turn some of the
lots and plots back again into farms. Of
this wildcat developing I have little to
say, except that it is hurting your busi¬
ness and mine. It is tending to cast a
stigma on the business from which you
and I gain our livelihood, on the profes¬
sion which it is your duty and mine to
protect  and   to   elevate.

Going hand in hand with this wildcat
speculation in land ^vas a tremendous
amount of worthless stocks and bonds in
fake realty companies and boom develop¬
ments. A friend in Duluth, who is at¬
tending this convention, wrote me about
some slock his client bought in a boom
development on Long Island, which
proved to be a baiTen sand bar. Another
in Seattle, one or two in Chicago and
others wrote me inquiring about rea] es¬
late securities of an almost worthless
character, bought by friends and clients.
Surely this is the kind of thing you and I
must help lo stop; especiaiy as conditions
are shaping themselves day by day so as
to make legitimate real estate security
more essentia] than ever, and the market
has got lo be kept clean.

The very fact that real estate is one
of the few lines of business which can,
in some instances, be entered wilh little
or no capital and less experience, aug¬
mented by the fact that the rewards are
often great, opens this business to the
wanton attacks of those who are un¬
scrupulous, and who, lured on by com¬
missions, go about handing out gold
bricks lo their clients to the detriment
of the profession at large, as well as to
their   own   ultimate   ruin.

You suburban developers who are
teaching the people how to live by buiid¬
ing sanitary honies, you builders "of idea.1
tenements in the congested districts of
the cities, you builders of modern office
buildings and other hives of industry,
which are constructed so as to give their
occupants the best possible living and
working conditions, are engaged in the
mosl ennobling work it is possible lo con¬
ceive of, preventing sickness, minimizing
crime, increasing efficiency and prolong¬
ing life and happiness.

As my particular specialty has been
the development of the skyscraper, I am
hardly competent to discuss suburban de¬
velopment, but as I tour about the coun¬
try I cannot but observe the nation's
tendency to migrate from the closely-
populated districts of the city back to the
country. Assisted by the trolley and the
automobile, as well as by occasional tun¬
nels, the people are taking advantage
more and more of sunshine and shrubbery;
and the developer who is building the
style of house the people want, and who
is building it well and who is laying his
property out in an attractive manner
and with suitable restrictions, will mar¬
ket his product. If, however, you do not
do this, some one else will, and the re¬
sulting competition will spell failure for
you. Whether office building or store,
mansion or cottage, you have got to have
something a little better and a little
sooner than the other fellow to succeed.

Some time ago a friend of mine ac¬
quired, under foreclosure, a row of seven¬
teen poorly constructed two-family
houses and when he complained to me
that out of the thirty-four apartments,
only ten were rented. I went to look at
them and found that in each of the
twenty-four vacant apartments was a
large and very objectionable "to let"
sign, advertising the fact that the whole
row was practically deserted. If the
plague had hit the neighborhood it
couldn't have looked worse. I at once
advised him to take down all the signs
but one. and to have cheap but neat lace
curtains   put  at   the   front   windows   and

•From  a  paper  read  before  the  National   Con-
vefition of .Real Eststp B:fchange,^ at LotUsyille,





it was only a short time before the ma¬
jority of the vacancies were filled.

Another row of houses stood idle for al¬
most a year. They were neat little one-
family houses, well built, but poorly lo¬
cated. Pinally the owners had them all
completely furnished at a cost of a.toout
three hundred dollars each, and af let-
adding five hundred dollars to the former
asking price, put an attractive "ad" in
the Sunday paper, offering the houses
with the furniture as a bonus, and of
my own knowledge the entire row was
sold   within   twenty-four  hours.

This   Is   the   Day   o(   Specialization.

I do not helieve it is longer possible,
except in some very remote cases, to con¬
duct the real estate business as it was
conducted in the old days. It is only
about flfteen years ago that the average
real eslate office in New^ York embraced
a variety of vocations, more or less allied
to the main idea, which fiuctuated from
selling coal to the householder up to
placing an occasional life insurance pol¬
icy, and each man in the office was dele¬
gated to look after each of these many
branches, meeting with more or less suc¬
cess measured accordingly as his ability
or opportunity occasioned. No oflice made
any pretense of engaging specialists, and
the only specializing that was done was
with the offlce itself, which generally
specinlized in the handling of property
and clients located in the immediate dis¬
trict which contained the office. From a
perspective standpoint, our country is yet
young, but we have long ago passed from
the haphazard, catch-as-calch-can method
of doing business, and have ascertained
that the successful man in any depart¬
ment of industry had to be a specialist.
Furthermore, we have learned something
in recent years of scientific management.
The successful offlce of the present time,
therefore, is made up, not of an organisa¬
tion of free lancers, but of a chain of
specialists in the various departments,
and as a chain is strong only to the ex¬
tent of its weakest link, the effort is to
bqve each man the best in his particular
line.

Thv    Skyscraper    Speeiali.st.

By no means the least important of
these experts is the skyscraper special¬
ist; the man who shows the capitalist
where to build liis twenty, thirty or forty
story building, and how to plan it; who.
through experience, has learned the ex-
trava.gances to avoid and the essentials to
install.

In these days of keen competition and
the survival of the fittest, the best plan¬
ned building is bound to be the most
successful, and when you realize that the
cost of the average modern offlce build¬
ing is well into the millions, you can
readily appreciate this man's increasing
importance. Information is your stock
in trade, confidence the keynote of vour
success, the degree of which will be
measured by your own personality ■ and
salesmanship. True, there are setbacks,
but these very disappointments are the
flres which temper the steel. Concentra¬
tion, system, energy, honesty to Yourself
and your client are bound to bring re¬
sults.

The nation is full of people with real
estate and with money. Most of them
don't know how to handle their own
property or how to invest their monev.
For every man with the price, there are
a hundred sharpers. The ranks are
crowded with brokers of the ordinary
class, but 'there is an unlimited demand
for the conscientious, specialized broker,
who can give sound recognized advice on
his specialty, just as the banker does on
financial securities, and who merits a
similar respect and standing in the com¬
munity. Choose your specially with care;
"Tou can't catch trout in a muddy pond,"
and having chosen it, "stick," for "a
rolling stone gathers no moss."

Moilorn Riiildjng Management.

If I may make this paper a little per¬
sonal, I would like to tell you about our
own organization, so far as it applies to
our real estate department. Our com¬
pany o-wns or controls over flfty million
dollars' worth of New York real estate
the large majority of -^hich  is improved





with such modern buildings as the Trin¬
ity. Flatiron, Whitehall. Everett. United
States Realty and Mercantile Buildings.
Directly, in charge of this property is the
Vice-President. Under him there are vari¬
ous departnients, such as the local man¬
agers in the larger buildings, the engi¬
neering department in charge of a Super¬
vising Engineer, a purchasing depart¬
ment, a repair department and a depart¬
ment of acconnts. The very names of
these departments so describe their func¬
tions that I need not bore you with a
description of them. I would like to
make an exception, however, of the en¬
gineering  department.

In the old days the chief engineer,
who was generally superintendent as well,
was the major donio. He hired and
fired; he bought supplies, coal, waste, oil
and the thousand and one things which
are requisite to the wants of the modern
skyscraper. He was kno-t\'n to take tips
occasionally and once in a while a com¬
mission on some of the supplies. So far
as our organization is concerned this man
is no longer. Instead of the superinten¬
dent, -we have the building manager,
generally a college man. who looks artet
the building above ground, who caters
to the whims of the tenants, who rents
oflices and has charge of the help. The
very class of the man precludes the pos¬
sibility of graft. The engineer has charge
of the plant of everything below the
street level. He is responsible directly
to the supervising engineer. The super¬
vising engineer, as a part of his super¬
vision, keeps records of the consumption
of coal, electricity and water and various
other essential data, which are kept on
charts, the curves of which show at a
glance the daily histoi-y of the workings
of the plants. These charts give imme¬
diate warning when an unusual situa¬
tion arises. The ofiice is similar to a
great many others in New York and else¬
where, but is naturally the one I am
most intimately acquainted wi'th, and I
wont to take this opportunity of ex¬
pressing my pride in the men who make
it up.

Ne«-  York  City Valin-s.

Years ago they told me in New York
that We had reached the top notch in
prices, but since then values have gone
up by leaps and bounds, until we have
reached the maximum at the rate of seven
hundred dollars per square foot, and still
we are not up to the top prices of either
London or Paris. The net increase of
land values in the City of New Y'nrk for
a period of len years, from 1900 to 1910,
was more than tbe combined gross out¬
put of ail the gold and silver mines of
tbe United Stales by one hundred and
seventy million dollars, -and ^^reater by
two hundred and seventy-eight million
dollars than all the dividends paid dur¬
ing this time by all the railroads of the
United States. And during this time this
land was paying satisfactory dividends
on its investment. This is the land, which
in 1626 was bought from the Indians for
twenty-four dollars, or approximately
nine cents for each one hundred acres.
True there are occasional recessions, but
these are mostly of a local nature, due
to trade changes, and these very changes
in localities are fruit for the broker, for
whether his client is moving into or out
of a  district,   he  needs  the   broker.

What applies to New York, is, I be¬
lieve, true of all the other large cities
in the land: Chicago, Cleveland, Detroit.
Denver. Omaha, Seattle, Louisville and
the entire South are going througii a re¬
building process. The method of steel
skeleton franie construction, developed by
George A. Fuller in Chicago a little over
twenty years ago. has created a new era
in the building business, making it pos^
sible to reap . a greater crop from our
city lots, and introducing conditions which
have brought about the replanning and
rebuilding of most of our large cities.
New Tork even has awakened from its
condition of lethargy and self-satisfac¬
tion, and, following the example of her
smaller sisters, is now diligently study¬
ing a city planning proposition. Civic
pride is the popularisni of the day, and
in all parts of the country we see a
rational and artistic touch being applied
to the deve;opment Qt the l^nd.