The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1910-12-11
ASTOR'S FORTUNE
MADE In REALITIES
Many Investors Practice the
Same Methods Now.

The great fortune of S1SOO0.O00 or 40
000,0o0 that John Jacob Astor. the founder
OF the family. bequeathed to his son Is
the most remarkable instance of the &C.
emulation of great wealth by land IN
vestment in the United States. While
money has been made and is now being
made in real estate investment in all
parts OF the country, it is not likely that
the country win ever see Ike conditions
in the same degree as those under which
this enormous sum was made. When
the time at which it was made is con-
sidered, and the amount is compared with
other fortunes OF that time, the appre-
citation of its great relative size is in
creased.
The Foundations Laid.
The land operations upon which this
fortune was built began as early as $780,
and the scene of the deals was laid in the
localities just a little beyond the limits
OF the city Of New York, which were
much contracted at that time. These pur-
chases were sold at any time when they
could be disposed of at an advance price,
and the proceeds were Immediately re-
the city.
The principles upon which John Jacob
Aston worked are well exemplified in the
story that Parton tells of the occasion
when Astor sold a lot on Wall street to
highly pleased customer for 5000. The
buyer boasted that the lot would be sold
IN a few years for $1,000, and sought 10
convey an impression of Astor's lack Of
foresight in selling it.
Yes" replied Aston. but with the
$500 l viii buy eighty lots above Canal
street. and by that time my lots will be
worth $50, ZOO"
War of 1912 Helped Him.
John Jacob Astor was able TO lend
much money on real estate security dur
ing the war of 1872, and many of the
mortgages thus acquired were foreclosed
at a great profit. At one time he ap-
peared as The plaintiff in no fewer than
sixty such suits at a single court
The panic of 1897 brought land values
down in New York. and Astor was able
to buy at great advantage in the low
market His profits on the sales of land
thus obtained are known TO have swollen
his fortunes TO a very great extent
A study of the methods which this real
estate master employed shows that he
operated upon the same fundamental prin-
ciples and under the same governing laws
| OF economies as do the majority OF the
men who are TO-DAY enjoying a success
| full career as land investors. He bought
unimproVed property in rather remote
situations at low figures and was able
TO dispose of this often at a great ad-
vance-sometimes of double or even
treble the original purchase price. Back
| OF 1t all was the keen discrimination that
enabled him 10 foresee with most profita-
| bic accuracy the forces that were working
to enhance the value of his holdings. He
read the signs Alright and with tremen-
dous profit 10 himself and his heirs.
The Unearned Increment.
| II is fashionable for some economists
to rail at the fortunes that have been
made by advances in the value of real
estate holdings and to assert or to imply
that the profits that accrue to the holder
have been brought about without effort
or without any mental qualification of
the man who reaps the benefits OF the
! successful investment II is absurd 10
! reason that the profits which Astor made
| from his methodical and systematic pro-
cedure did in no way depend upon any
qualification or especial fitness ef the
/ investor. This criticism. if it were true.
might as truthfully and as justly be made
against all who acquire wealth by in
vestment OF any kind. While land invest
ments most frequently of any Of the sew
eral forms of investment Of savings af-
| fords striking examples of value accre-
ton associated with only a minimum of
! personal activity, the sure basis of con-
tinuous and sustained success in opera
tons depends upon the discrimination that
/ guides the investor in forming his judg-
ment upon the localities in which his in
| vestnents should best be made