REAL   ESTATE







BUILDERS





AND







NEW YORK, JUNE 7, 1913





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THE  BIG   MORRIS   PARK  AUCTION   SALE





Lots Bought For a Rise, Many of Them By Out-of-Town Investors,
At Good Prices—A   Week of Remarkable   Investment   Contrasts.





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THE creditors for whose benefit the
State Banking Department is liqui¬
dating the old Morris Park race track
property have reason to be satisfied with
the big auction sale that has been under
way on the premises since last Saturday.
At the time this is being written l.SSfi
lots have been disposed of for $1,631,000.
Ten years ago the financier whose ex¬
ploits have brought about the present
liquidation purchased the tract for
$300,000.

If the 1,463 lots that are still lo be
auctioned ofif bring the same average
price, $1,048, as those already struck
down, the sale will realize some $3,150,-
000. In other words, property bought
ten years ago at $1,000 an acre is now
selling at better than $1,000 a lot. Yet
a large proportion of the lots are
as innocent of sulisurface street improve¬
ments as they were then. This is not
saying that the lots are not worth what
they are bringing. It is merely a reitera¬
tion of a well-known fact: that there is
substantial value in real estate on the
line of progress of the city's growth.

There are several other notable phases
of this sale. Perhaps the most remark¬
able is that it met with any degree of
success at all in a week when security
prices on the Stock E.xchange reached
the lowest point which they have touched
since the panic of 1907. .\t least 5,000
people, quite a sprinkling of them out-
of-town investors, were attracted to the
sale; and, there was capital enougli at
command to take up an unprecedentedly
large ofifering of vacant lots, while securi¬
ties went begging because of a world¬
wide money stringency. This interesting
phenomenon is no doubt capable of more
than one interpretation. But it is only
fair to assume that buyers who have
looked forward to a sale for months are
acting upon reasoned convictions. Pos¬
sibly, under e.xisting industrial, political
and financial conditions, they delilierately
prefer exclusive ownership of concrete
property; that is, the demand for lots
developed at this sale may be another
manifestation of the temper which is seen
in the current tendency toward hoarding
of money.

.A.S to the prices obtained, there is no
evidence yet of the expected "sacrifice."
.-\t this writing agents commissioned to
pick up genuine bargains have bought
very little indeed. The prices paid have
turned out to be, on the whole, as fair
to the sellers as to the buyers. They
show a big recession froin boom times,
now distant, but they show an advance
over valuations of recent years. They
could not have been obtained before the
dual subway contracts becatne a cer¬
tainty last spring. The tax assessments
representing market values of last sum¬
mer average only about 60 per cent, of
this   weeH's  auction  prices.





As a matter of fact, the valuations
established at this sale are likely to be
accepted as standard for current apprais¬
als. This assertion may not appeal to
a certain minority who live entirely in
the past and who refuse to recognize
that capital values are afifected by a
general rise in the rates of interest on
money. It may be urged that the great
number of lots offered have a depressing
effect on prices. But, on the other hand,
no other lot offering has ever been so
extensively or so ably advertised; and
any deficiency of local buyers was made
up lij- the presence of out-of-town pvir-
chasers, whose investments were on a
generous scale. Finally, the sale was an
ideal one from the buyer's standpoint.
It was announced as absolutely unpro¬
tected, and the announcement to this
effect v/as backed by the State Banking
Department.

A real estate auction sale which is so
notable intrinsically, and which has been
so widely advertised—fully one hun¬
dred thousand is said to have been spent
on publicity—must be an event of signifi¬
cance from different points of view to
readers in various occupations and pro¬
fessions; and for this reason we bring to¬
gether the following comments on it by
persons whose opinions carry weight be¬
cause of special opportunities for obser¬
vation or of particular knowledge con¬
cerning prices, contemplated street im¬
provements, or transportation  facilities.





Raises Value of Adjacent Property.

In my opinion the sale is making ex¬
cellent progress. The prices lots are
bringing are remarkable for an auction
sale, and they are having a stiffening
effect on neighboring property, some
owners of which, judging from the prices
paid at this sale, have come to the con¬
clusion that they liad undervalued their
own holdings.

I will cite an instance of my own
experience. An owner listed a 45-foot
corner near the Morris Park property
with me, to sell at $3,500. I procured
a purchaser, who agreed to buy at that
figure. On the day the contract was to
be signed the owner jumped his price
to $5,000, based on the prices Morris
Park lots were bringing. The result
was no sale. He has since shown me
an offer of $4,700, which  he has refused.

The sale should help The Bron.x. Its
unquestioned success must establish a
great deal of confidence in Bron.x 'real
estate.                      GEORGE    PRICE.





Testifies to the Public Confidence.

In response to your request for an
opinion regarding the auction sale of the
old Morris Park race track now in
progress, I would say that I am im¬
pressed with the fact that, at this writing,
there have been gold to builders and in¬





vestors more than 1,300 lots, at an aver¬
age price in excess of $1,000 a lot. If
the sale progressed no further, I would
still think it a great achievement that
testified in a notable way to the under¬
lying public confidence in New York
City real estate.

In view of money and general mar¬
ket conditions, the ability and willingness
of the public to respond to this sale
in so substantial a tnanner must be ex¬
ceedingly gratifying to everyone inter¬
ested, either directly or indirectly, in
New  York  City  real  estate.

On the other hand, the prices being
realized for property, the greater part
of which lies on streets graded, curbed
and flagged, when reduced to an acreage
basis, appears to me to be low in com¬
parison to the prices at which desirable
Bronx acreage  is being held.

AUSTIN  L.  BABCOCK,
Of .American  Real   Estate   Co.





Immediately Available for Development.

The rapid buying at excellent prices
at the Morris Park sale is very signifi¬
cant, because it shows the widespread
interest and confidence in real estate in
the Borough of The Bronx. This is
more marked because at present real
estate in New York generally is very
(Uiiel. The purchases seem to be made
r.ot by speculators but by buyers who
intend  to  build  homes.

The efTect on the East Bronx of the
influx of new home builders will revive
activity in a section of the borough which
his been dormant for many years. This
interest is justified by the rapid transit
and industrial railway plans which now
are n.aturing for the locality. The build¬
ing of trunk line sewers makes these lots
immediately available for development.
CYRUS C. MILLER,
Borough  President of The Bronx.





Breaks Down a Barrier.

The sale of the Morris Park tract
which is now going on has greater sig¬
nificance as to the future of The Bronx
than  many  appreciate.

The growth of The Bronx up to the
time of the building of the subways was
relatively slow. Its growth then took
place in jumps, and big jumps at that.
The increase in assessed values, 1899 to
1910, tracing to the operation of the
Interborough in the lower Bronx, was
460 per cent. This phenomenal growth
was necessarily confined in greater part
to the district served by the rapid transit
lines.

The opening of the New York, West¬
chester & Boston Railway the early part
of last summer made accessible a iiew
section which had heretofore been with¬
out transit facilities. The development
along its line had reached not much fur¬
ther north than Bear Swamp Road, and