Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: v. 59, no. 1516: April 3, 1897

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April 3, 1897. Record and Guide 549 ESTABUSHED^ liyiRpH awe*'1868, Opi6TiDToRf\LEsTWi,BuiLDifJG A;RpifrrECTUi^>(ousEaoii>DEea^H»HL .Bifsutess Alto Themes or GEjto^lW'reRfsT. PRICE, PER YEAR, IN AOVANC«, SIX DOLLARS. Published every Saturday. IBLEPHONE, . _ . . . . COHTLANDT 1370 Commtmioatlone should be addresaed to C. W. SWEET, 14-16 Vesey Street. J T. LINDSET, Business Manager. _______________^_______________________________■_________________________ "Entered at the Post-office at New Tork, Jf. Y., as second-class mailer." :VoL. LIX. APEIL 3, 1897. No. 1,516 Over li;20,000,000 new buildings have been planned for ao far thia year. Have you obtained your share of it? Do you know of the many otber large jobs now being prepared, and of tbe hundreds of cuatomers in your line who are about to come into market for materials? Tou oan obtain thia informa¬ tion daily from the F. W. Dodge Co. (Inc.), 310 Sth avenue, southeast corner 6th avenue and 20tb street. RAILKOAD men are fretting over the fright into which the Supreme Court decision on pooling plunged them, and as a result we have had a reaction in the atock market, wbich has also "been sufficient to check an organized raid to break all the Coalers because of the weakness of Jeraey Central and because there is an idea floating around that the decision affects the Coal roads most injuriously of all. The situatiou created by the Supreme Court decision is a serious one for all railroads, but the idea that it threatens the Coalers most i'- pnrel? a sentimental one; because it is notorious that, although the Coal roads have agreed o« percentages of outputs and prices each year for a number of years the agreements have never been kept. This was the testimony given before the Lexow Committee in this city recently and every well-informed Wall street man knows that the statistics corroborate it. However, if people choose to scare from any cause whatever, they will find the professional element in the Stock market always ready to assist their fears and at the same time scalp some profit out of them. The situ¬ ation is such that no bull movement can be expected until the Joint Traffic Contract has beeu considered by the United States Supreme Court and their opiniou of its legality rendered, or until Congress has provided a way of protecting the business of the counti-y, as well as of the railroads, froni disorganization and consequent trouble and loss. The outlook is for a dull market for a little time to come, and if preseut values are fairly preserved that will be as much as can be expected while business everyvchere is awaitinji the disposition of two such very im¬ portant questions as the settlement of the tariff on imports and the future of carrying rates. UNDEE the strain aud anxiety of waiting for a settlement of the current chapter of the Eastern question, there are signs of a shrinking iu the volume of European business. Statistical reports now appearing, which are very favorable, relate to the past and for the same results to be repeated it is necessary that confidence receives no set-back. The sentiment¬ alists aud imaginaries, who would settle the Cretan question by giving Greece what its buccaneering espedition set out to get, are disappointed in finding that the powers remain determined to prevent the infraction of the public peace if possible. These poetical enthusiasts on both sides of the Atlantichavedetermined in their minds what all the Great Powers have not yet been able to find out, the wishes of the Cretans themselves. They say Crete wants to be annexed to Greece, but they do uot say how they know it. Certain Cretans wbo may be only bosses and corrupt politicians say Crete wants annexation and say this so loudly that it deceives the people content with superficial ties into assuming th i theirs is the voice of all Crete. An im¬ pression t.revailed some time ago that our good city wanted to be annexed to Brooldyn, and accepting the cries of sentiment¬ alists aathe voice of the whole people, the Legislature has annexed us to Brooklyn accordingly aud now the great repre¬ sentative business interests and powerful sociological organiza¬ tions of the city are fighting tooth and nail to postpone, if they cannot avert tho doora impending over us. In like manner the real voice of Crete may be inaudible at the preseut moment amidst the din raised by the annexationists but which when heard may pronounce for autonomy. There are good reasons, not unlike Xew York's for avoiding annexation to Brooklyn for sup¬ posing that this may be the case. Crete released from Turkish rule and alone will have no debt while Greece is almost swamped by excessive financial burdens and extravagances, part of which would be thrown on Crete in the event of union. In fact sucli an arrangement woul i make Crete virgin soil to the Grecian tax-gatherer. The powers, however, say let both Turk and Greek withhold their hands and give the island an opportunity to consider and mature its own wishes. Surely thi« is fair. IF tha weather be fine au enormous crowd will witness the official acceptance by the City of the custody of the Grant Mausoleum. The occasion will serve to bring to the attention of a good many people a fact which uot everybody notices, viz.: that the upper West Side has taken on a grand and monumental air. Something of the effect of the several public or semi-public improvements planned for in that locality during the last half decade is now visible. St. Luke's Hospital, of course, is finished. The outlines of Columbia College are established. Barnard's College is more than roofed in. The Teacher's College remains amid its newer surroundings a charming piece of architectural work. Riverside Drive is one of the finest parkways in the world, and now Grant's Tomb serves as a monumental focus- point at the northernmost extremity. Even when merely the buildiugs now erecting or planned for are completed the district will wear a very noble appearance and New Yorkers may be proud of it. It is a disgrace though, that the authorities do not take the Boulevard Parkwaysiu hand and develop them beyond the tin-can and dust-heap stage in which they are at present. Private enterprise has made the West Side what it is. The City should co-operate and do its part promptly. Building Loan Profits. THE real estate market at present has several weak spots wbich deserve to receive the careful attention of the trade. We do not refer to conditions that are the result of the general commercial depression and will pass away when business re¬ vives. What we have in mind are special infirmities, diseases, we may say, of the system itself, which are workinggreat harm and are bound sooner or later to produce disastrous conse¬ quences. One of the most marked of these evils is tbe Building Loan Operation. There is no necessity to define for our readers' understanding the system of enterprise which hinges upon this particular species of money-lending. Properly conducted it is legitimate enough. Undoubtedly it has been of benefit and has enabled builders possessed of little capital to successfully carry out op¬ erations entirely beyond Ihe scope of their personal finances. A considerable part of the work done in building up the city has been advantageously based upon this system of loans. In the last few years, however, with the extension of the system, it has undergone a pernicious development, un(il to-day it is, broadly speaking, a very objectionable and dangerous form of enter()ri8e. In a majority of cases as practicedit has become a cunning, skilfully methodized form of legal cheating. It not only promotes disaster and bankruptcy but aims for that result. Certain classes of buDding operatiors are nowso honeycombed and undermined by it that they can no longer be regarded as in the category of bgitimate business enterprises. The time has come for plain speaking and vigorous action. We have to deal with a commercial form of piracy—financial wrecking. Builders —those who build to sell—are going down under it, walking the plank through its tyranny. Building material dealers are robbed by it under the guise of legitimate trade. The proportions which the enterprise has attained can be measured only by carelul inspection, because operations are ob¬ scured by the practice now so common of putting only "nomi¬ nal considerations" in deeds. This cloaks the transaction. When, however, we get behind this suppression of facts, the nature of the hidden scheme, its purpose and inevitable result are too plain to need further inquiry. The whole game is dis¬ closed. We find on one side a Builder with a comi aratively small amount of capi'al engaging in an enterprise for wbich he must borrow a considerable part of the monev he needs. On the other side we find the Building Loan Operator supplying him wilh the funds required aud with the lot or lots upon which he is to build. Formerly, in the days of legitimate transactions, the land was turned over to the Builder at a price which gave the money lender a substantial but not extortionate profit of $1,000, $1,500 or $2,000 a lot according to circumstances. This apart from interest for borrowed money. It was possible then for a borrower to build with a reasouablf chance of success. This has all been changed. Tbe present system is effectively arranged to prevent any Such result. Let us take a recent example of what i-- done—a case which concerns a block of lots on the West Side. These were purchased a short time ago hy a Building Loan Operator for, say, $300,000. Only about $50,000 was paid down in cash: the rest remained on mortgage. Investigation shows that the parcel was bought at a fair market price. It was no particular bargain. Now, this block has since been disposed of to builders at the modest