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Real estate record and builders' guide: v. 18, no. 452: November 11, 1876

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Real Estate Record AND BUILDERS' GUIDE. Vol. XVIII. NEW TORK, SATURDAY, NOVEMBER 11, 1876. No. 452 Published Weekly by Cfje §lcal Estate %aaxb ^ssodaimit. TERBIS. OWE YEAR, in advance....$10.00. Communications should be addressed to C. W. SWEET, Nos. 345 AND 347 Broadway. NOTICE TO SUBSCRIBERS OF THE BANKER AND TRADESMAN. In accordance with the terms of an agreement en- tci-ed into betAveen the Real Estate Record Associa¬ tion and the Banker and Tradesman's Company (Limit¬ ed), the Real Estate Record newspaper is sent this AveekandwiUbesent every Aveek hereafter to CA-ery subscriber of the Banker and Tradesman for the term of his subscription to the last named paper. Readers of the Banker and Tradesman not famiUar AA-ith the contents of the Real Estate Record avIU find, upon perusal, that Avhile it contains aU the important fea¬ tures of the Baijker and Tradesman, it also has a number of specialties distinctively its oaa-u Avliich can¬ not be found in any other journal, a familiarity Avith Avhich vrill give the patrons of the Banker and Trades¬ man no cause to regret the change. BROADWAY. If ever the citizens of New York had reason to hang their heads Avlth shame, it is at the present time, in contemplating the vacant concUtion of Broadway buildings. From the Battei-y to Four¬ teenth street no less than two himdred placards of " To Let" are to-day exhibited, whUe ia the oc¬ cupied stores there is a change for the worse in the class of tenants. BuUdings heretofore devoted to the wholesale trade, have been arranged for offices of various kinds, and of these, it is safe to say, not one-half are occupied. Those buUdings that retain their mercantUe character, are princi¬ pally in the hands of the clothing trade ; the once famous thoroughfare thi-eatening to degenerate to the level of old. Chatham street. A great number of stores are temporarUy occupied as auction marts, jobbiug houses, and places for the sale of bankrupt stocks. TUere is a large sprinkling of the poorest class of retail business and penny shows.. This state of things contrasts unfavorably with by-gone years, when the chief AVholesale trade of the city was carried ou along . Broadway, merging into, and closely crowding, the best class of retail estabUshments, making this great artery of our city, as we are boastingly ac¬ customed to claim, a panorama of most active business, and a spectacle dazzling to the eyes of country -vdsitors. But this great display is no longer conspicuous, and a walk along Broadway has become a doleful and dreary afiEair. We are wout to attribute this condition to the severity of the times, and this, no doubt, would answer as a gehereil cause, The hard times have left an in- deUble impression upon this great business street, and the vacancies ^that there occur, are sure ra¬ dices of the untold disasters that have -visited former tenants. Upon closer analysis we can discern other causes which have led to this con¬ dition, causes whose remedy lies directly -within the power of the present OAvners of such property. They ace mostly the representative pioneers of real estate investment in this city. To-day the bulk of these properties are held by f amiUes Avhose ancestors were purchasers fifty or more years ago. Their history illustrates in the highest measure the intrinsic and progressive value of the best Ncav York propei'ty. Lots which were purchased at a few hundred, or at the most a few thousand doUai-s, have become so valuable that any one of them to-day, after allowing for the re¬ cent shrinkage m values, would represent a good .sized fortune. A Umited number of these proper¬ ties have passed out of the "hands of the original OAvners at a comparatively recent date, and the present oAvners, no doubt, have invested fabulous sums on the strength of foi-mer exorbitant rents and flourishing business. The highest prosperity of our mercantUe mterests has been heretofore concentrated in Broadway, where, in times past the most manifold business has been transacted, .and the largest fortunes reaUzed. At one time, indeed, it might safely have been said that in the properties themselves, and the capital invested in the business there carried on, a larger amount of aggregate Avealth was represented than in any similar length of street in the world. Hence the OAvners of this Broadway property have become accustomed to'the contemplation of large values, and have been educated to the receipt of enor. mous incomes in the shape of rent. The times, however, have changed and the high rents have so exhausted the business houses which formerly occupied these buildings, that many of them have gone into banki-uptcy. We are aU f amUiar with the recent case where a lease was effected at the comparatively low rent of 825,000. Yet, in less than six months time, the firm assuming this obligation, found itself insolvent through the f aUure of business, and is now passiag through bankruptcy. The propositions present themselves fairly and squarely to landlords—whether m attempting to hold their premises at old rates they "wiU be con¬ tent to have them remain vacant, or to accept weak or failing firms, and let their buUdings undergo an ordeal of misuse and loss of rent, Avorse than emptiness, or whether desiring to see the street bi-istle again with activity and reani¬ mate with the stir of successful business they AviU fix their rents on allAong and rational scale. There is not the sUghtest question but that every store on Broadway, \Adthui the Umits we have named, could be readily flUed with solvent and successful tenants, if the rents were lowered.in accordance with the times. Instead of this, Aye find the best retail business crowded into Four¬ teenth street, Sixth avenue and upper BroadAvay. The importers and jobbers are driven into Broome, Grand, and. the streets ruiming paraUel to Broadway, whUe only the meaner classes pf business and the most risky kinds of wholesale trade are found courageous enough to encounter the high tariff rents that are stUl demanded for Broadway stores. It is safe to say that there are tAvice the number of business firms on the streets adjoining Broadway who would gladly transfer then- locations to the main thoroughfare; and the places left vacant by them would be quickly fiUed up with a smaller class of trade We have grown accustomed during the past few 3'ears to the deserted appearance Avhich Broadway noAV presents, but we hope that in the immediate future sufficient practical sense AviU be mfused into the minds of the owners of these properties to induce them to break the deadlock, to offer their properties at moderate rates, and thus secure a resumption of the foi-mer business prosperity which has ever before characterized this favorite thoroughfare. Any valuation of BroadAvay pi-operty, which ex ceeds from tAA'o to four thousand dollars a front foot for improved property, is unduly inflated for the present time, and rents based upon any such valuation, aatU surely fail of acceptance. We know of stores on this line which are now offered for one-half the amomit formerly obtamed, and even at this reduction tenants are Avith difBculty secured. As compared with other standards, we shoiUd judge that the gross value of Broadway property should be marked doAvn at least one half, and that rental values, for at least the jiresent, should be reduced one-half or two-thirds, from the points of highest altitude. THE SAVINGS BANKS. A report comes to us, apparently AveU authenti¬ cated, that the leading Savings Banks of the city have determined, on and after the first of Janu¬ ary, 1877, to reduce the rate of interest, to be paid on deposits, to four per cent, per annum; and that this measure avUI be preparatoi-y to the reduction of the rate on mortgage loans from seven to six per cent. We cannot but regard this poUcy as Avise and salutary on the part of the banks, and in keeping with the conservative management which has heretofore marked the best of these institu¬ tions. The effort on the part of Savings Banks to earn high interest, honestly if possible, but at any rate to earn it, has resulted m many grievous errors and abuses. The low rate of interest, which has preyaUed in the open market for nearly three yeai-s, threatens to become permanent. At aU events, able fUianciers consider low rates for money as likely to be characteristic of the market for many years to come. AVhatever differences of opinion may now be entertained as to the Avis- dom of this course on the part of the Savings Banks with reference to their depositors avo can¬ not but think that the com-se of future events wiU justify it. The mass of their depositors are not dependent upon this interest as in¬ come ; but, on the contrary, prefer to aUow its small accretion to be added to the principal and the safety of their principal is the paramount con¬ sideration. They have had an opportunity recent¬ ly to study the effect of promises of large returns. In some cases as high as six or seven per cent being offered as annual interest, and the sequel has been the sAvamping of both principal and interest in the maelstrom of disaster. We are happy to say, that there are SaAdngs Banks in this city which adorn its banking interests, and are a credit and hon'or to the country ; and it is these, which uoav propose to take the initiative in the estabUshment of a lower rate of interest. The immediate appar¬ ent loss to the depositors AviU be more than counter-. balanced by the additional security in the safety of their investment. For the real estate interest^