Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: [v. 94, no. 2423: Articles]: August 22, 1914

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REAL ESTATE AND NEW YORK, AUGUST 22, 1914 WAR'S EFFECTS ON BUILDING INTERESTS I As Viewed by Manufacturers of Construction Materials an(d Real Estate 1 I Brokers—A Big Business Revival After a Time, the General Expectation I iiiiiiiiiiiiM^^^^ A GREAT market is opening up for American building materials if our producers can avail themselves of it. The Government has this week made it pos¬ sible to quickly enlarge the merchant marine so that American exports can be sent anywhere in neutral bottoms, but the question of freight rates remains to be settled, and on these will largely depend how much material our manu¬ facturers ma^' be able to send abroad. Confidence in the ability of the Ad¬ ministration at Washington to keep this country out of the armageddon that has cut off or paralyzed thc exporting indus¬ tries of Europe is firmly established, and the general expectation is for a great acceleration of our foreign trade, and that this will eventuate into a general re¬ vival of buildine construction in New York. Many manufacturers, including those engaged in cement, steel and building equipment lines, are already arranging for banking facilities: and, on the other hand, the South Americans are looking to us to supply their needs. The di¬ rector of public works at Santiago, Chili, has opened a bureau of informa¬ tion for American building materials, where Chilean architects and engineers can come and examine American cata¬ logues, price lists and samples. Interviews with representative manu¬ facturers and dealers here this week dis¬ close that they are waiting only for the apparent opportunity to be made prac¬ tically available. The general expecta¬ tion is that a general revival of all the various lines of business related to real estate will eventually result from the war. Ironmasters Expect Big Business. James Wells, of the Wells Archi¬ tectural Iron Company, said: "The intiuence of the European war on building material values will natural¬ ly advance prices, which may result in a temporary check to Building activities, but the effects of advanced prices are likely to be discounted by a decided im¬ provement in general business later. "The key to the new conditions is now in the hands of the alert manufac¬ turing and financial leaders of this coun¬ try, who arc not likely to lose the pre¬ vailing opportunities of securing a great¬ er portion of Europe's vast export busi¬ ness. "This country's enormous capacity i.ever was in better condition to enter into contracts to supply the world's re¬ quirements, and when investors recog¬ nize a movement for new export busi¬ ness, then our building trades will im¬ mediately receive an impetus to prepare for the demands of progress." Foreign Cement Business in Prospect. Albert Moyer, of the Vulcanite Port¬ land Cement Company, with offices in the Fifth Avenue Building, said: 'The price of Portland cement is de¬ pendent upon the relation of the num- b-^r of barrels manufactured in any one district to the consumption of Portland cement in the market supplied by that district. New York City is supplied by the Lehigh \'alley region of Pennsyl¬ vania and New Jersey, and by New York State mills located on or near the Hud¬ son River. These two districts also sup¬ plv nearly all thc cement which is ex¬ ported. At the present time the stocks in the Lehigh Valley are as low as they have been since 1910 and the prospects for doing a tremendous export business are excellent. South America consumes millions of barrels a year and the coun¬ tries south of us buy nearly all of their cement from either Great Britain, Ger¬ many or Belgium. Not over a million barrels of American cement is export¬ ed annually to South America. "Owing to the war, it will now be im¬ possible for these countries to obtain their supply of cement from their usual sources, and they will be forced to turn to the United States. The amount that we can export to South America de¬ pends upon a merchant marine and prop¬ er banking facilities. It is to be hoped that the New York banks will make ar¬ rangements to furnish facilities in the South American countries so that drafts can be drawn on New York. Up to the present time, practically all drafts have been on either London, Berlin or Paris. "This tremendous prospective export business undoubtedly will have the ef¬ fect of -stimulating prices on Portland cement for the New York market." All Depends on Shipping Facilities. William P. Corbett, of the Alsen Port¬ land Cement Company, said: "There is an enormous market for first- class Portland cement in South Amer¬ ica and the West Indies, which amounts to approximately 15.000,000 barrels. If all the mills in the Lehigh Valley ran at top capacity, thev probably could not make more than 8,000,000 barrels above the present supply, and by that we mean mills that could be suitably run. There¬ fore, if they should increase the output 8,000,000 barrels in the Valley, the mar¬ ket in question would take practically twice that. It has been shown that the moment the consumption of ceinent reaches or exceeds the production to even a triflino- extent, the price cannot be held in check, because contractors naturally become nervous the moment shipments are delayed. They cannor have important contracts retarded, as the cost would be enormous, and their anx¬ iety is then as great to buy as their procrastination when there is a chance that prices may be a little lower. "This country having no ship subsidy, such as England possesses, we have no adequate merchant marine. There are numerous commodities besides cement which could be advantageously sold to some of the rich Southern countries if we had reasonable freight rates. Fur¬ thermore, in regard to cement, a great advantage would he the fact that those countries, on account of their warm cli¬ mate, would use cement right through the winter when work up here is more or less shut down. The deplorable situ¬ ation abroad has brought a great oppor¬ tunity to this country if advantage can be taken of it. Our Congressmen, not¬ withstanding our enormous expanse of coast, have often been very shortsighted in such matters. Need of a Big Merchant Marine. "This country needs a splendid mer¬ chant fieet besides a war fieet, and with it we could now profit tremendously, owing to the lamentable position of those in Europe. Germany, England and Belgium, the great exporters of cement to South America and the West Indies, are now shut off completely. Germany has the best of this trade and England comes next. Belgium exports large quantities. The American cements are fully equal to the English and much better than the Belgian brands and are, in fact, equal to most of the German cements which run verv high in quality. Germany especially has been able to ship enormous quantities of very high grade Portland to South America and to do so at a price which American brands could not meet because of the exorbitant freight rates as compared with those from abroad. "From this you will draw the con¬ clusion that any advance in Portland cement because of this war would be de¬ pendent on the question of facilities for transportiner promptly. Even if a rea¬ sonable number of vessels could be ob¬ tained at this time, it would take, of course, a few weeks to get any great quantity loaded and shipped, but a start would be beneficial, and furthermore, a market once gained is much easier to keep than it is to obtain a new market. Personally, the writer does not look for any immediate advance; or, if there is an advance this fall, for more than a moderate increase in the price, and cer¬ tainly not enough to injure or interfere with any hoped-for revival in the build¬ ing trade. A difference of say 10c per barrel would not be felt at all in good times, while a large export business would wonderfully stimulate things in this country and perhaps hasten the re¬ covery from the unquestioned depres¬ sion from which business men have suf¬ fered. All of the large contracts which we are supplying are going along just as usual, with no indication of any ces¬ sation which, of course, would not be expected." A New Era at Hand. William K. Hammond, a director of the association of Dealers in Building Materials, said: "For the immediate present, in my opinion. building construction must await the eventualities of the war. Many kinds of material will for a period be sold at prices so near a loss to the producers that those who are now able to purchase and use these goods will be greatly advantaged over those whose operations are long deferred. "Not that I predict a sudden or sharp advance in prices, yet the results to this country from its own internal com¬ merce, together with the world's busi¬ ness which will presently be transacted here, all make for changes and in¬ creases in demand in our Greater City and surroundings, not to speak of the