CHAPTER 10

GIRARD ESTATE[1]

 

When Girard died in 1831 his Estate was valued at about seven million dollars, the equivalent of approximately $30 billion in 1999 money.  He decreed that no more than two million should be used to build the college. Another half million was willed to various causes and family. The remainder of the assets including real property and investments was intended to sustain the cost to operate the College.  He also said that none of his holdings were to be sold and the revenue from them was intended to sustain the college.  Today the estate is valued at about $400 million.  Should it be more?  Is the Girard legacy in trouble?  Are there sufficient funds to sustain the College?  If so, for how long?  Could the Trustees have done a better job in administering the Trust?  These are important questions because the answers involve the future of the Girard legacy.

Between his death in 1831 and 1860, the estate’s growth was slow and unimpressive because the governing body was constantly changing because of political affiliation.  Most of the increase came from rental fees from the numerous properties.  Beginning in 1860, the coal mining lands were leased.  Mining increased because coal was replacing wood as the main source of fuel.  Royalties were received from each ton of coal shipped from the estate-owned land.   In 1869 the State established a permanent Board of Director’s of City Trusts and the estate began to grow rapidly.   Between 1880 and 1930, the total value, real estate and financial investments, rose from $6.3 million to $89.5 million.  Table 1, Girard Estate Statistics, charts the increase in residuary value, excluding the worth of the real estate.

Today the College and the Estate is controlled by a Board of Directors of City Trusts.  Appendix C of the 1870 Board report explains the following evolution of the Board from the death of Stephen Girard.  The City supervised the construction of the College through a Building Committee appointed by the City Councils.  When construction was completed, management of the College was turned over to a Board of Directors appointed by the City with each member to serve no more then four years.  However, control and administration of the property and the Trust was retained by the Councils through a committee designated the “Committee on Girard Estates”.  This awkward arrangement existed until the State Legislature passed, on September 2, 1869,[2] an act that created the Board of Director’s of City Trusts.  The discharge proceedings of President Smith revealed that the Board’s two political parties fought over every action involving Girard College and control of the Board depended on who controlled the City Councils.  The reports also reveal that the constant membership changes retarded the growth of the Estate. “Frequent and violent political changes in the City government induced partisans to use sacred trusts to a greater or less extent for party patronage. The tried officers who had become familiar with their duties were removed and replaced by professional politicians who were compelled to pay a percentage on their salaries to the dominant political organization, and to employ mechanics who were influential in the party.  The most rigid party rules were also applied by Council to Girard College, by removing every director who did not belong to the dominant party.  As no nation, nor state, nor city government could long survive under such a rule, so the usefulness of the College was being curtailed and imperiled by it.”[3]  These actions led to the State act passed in 1869.

The act designated that the new Board consist of 15 people, including the Mayor, the Presidents of the Select and Common Councils and twelve citizens living in Philadelphia, selected by Board of Appointment consisting of judges from the Pennsylvania Supreme Court, District Court, and Common Pleas Court of the City.  The members would serve for life “during good behavior” subject to removal only by two thirds of the Board of Appointment.  Not wanting to lose control of the College, the city challenged the Act on the grounds that the State could not dictate matters of this type.  The Act was found constitutional and implemented.  Between 1869 and 1930, Board members voluntarily retired or died in office and the average number of years serving on the Board was fourteen. 

In 1870 the new Board immediately initiated contracts to build additional houses and buildings on the Estate’s  properties so their rentals would help expand and sustain the Estate.  In 1870, eight houses were built on 6th Street, below Brown, and they cost an average of ten thousand dollars to build and were rented for between a thousand and twelve hundred dollars a year.  Three dwellings on Chestnut Street were converted into stores and together they rented for $13,000.  In 1871, 11 houses on Marshall Street between Brown and Coates were nearing completion.  In 1872, ten houses were being built on the east side of Sixth Street and two on the west side. The 12 houses cost $143,000 to build and were expected to produce $14,000 in yearly rentals.  Another row of houses was being built on Fifth Street and Brown, and on the east side of Fifth Street north of Chestnut.  The Estate owned the entire front on Marshall Street from Coates to Brown.   In 1873, the building of rental houses continued.   At least four rows of houses had been built between Coates and Brown Streets and many on Fifth, Sixth and Marshall Street.    A bank was built and rented at Chestnut and Ranstead Street.  The bank was designed by James H. Windrim, the Architect for the Estate and a Girard College graduate.  By the end of 1874 the Estate in the City “comprises two hundred and thirty buildings, three piers or wharves, and five hundred and fifty acres of land in the southern portion of the city waiting for development in the near future”.

In 1875, the Estate enlarged Pier No. 3 and stores were being built in the 1100 block of Chestnut.  A building was being erected on Hudson Street, in the rear of the Girard Bank, to be rented to the Board of Brokers.  An economic depression occurred in 1878 that caused the Estate to reduce rents and curtail expenses.  In spite of this, two additional blocks of offices were built south of the Girard Bank building on Third Street and the house on the corner of Girard and South College Avenues was purchased to prevent “undesirables” from living near the entrance of the college.[4]

By the end of 1879 the Estate owned 275 buildings/houses that were rented at various rates from $225 to $18,000 per year. Most of the houses had been built since Girard’s death.  In Schuylkill and Columbia Counties there were eleven coal collieries in operation under ten leases.  According to the 1879 Board report, the first coal removed and sold commercially from the Estate’s mines occurred in 1863.  That year 40,788 tons were sent to market.  In 1879, the amount marketed was 1,600,000 tons and royalties grosses $463,644. The Estates coal mines were leased with a royalty of forty cents per ton and progressed to fifty-four cents.   Three- fourths of that was reinvested “in the real property in the City, so as not to diminish the fund upon which the support of the College must ultimately rely when these lands shall have been stripped of their mineral resources.”  The Estate also owned 2,511 acres of land in Kentucky[5], that were mostly woods of little value.

The security of the Estate owned house at the corner of Twelfth and Girard Street

(Girard Street is a small street just south of Market Street.) was improved in 1882 and all the deeds and Trust of the Estate were moved to that building while nearby a building was being constructed in which the Board’s offices would be located.  The following table reflects the properties owned by the Estate in the City of Philadelphia in 1882.

 

 

 

LOCATION OF GIRARD ESTATE PROPERTIES IN THE CITY - 1882

 

 

LOCATION

ANNUAL RENTAL

 

 

Nos- 306 8-10-12 S. Second St.

$2,450

Comptroller St., (11 houses)

$2,875

Nos. 206, 326-28-30-32-34 Spruce St.

$3,400

No. 106 to 136 South Third St.

$27,855

Building N. E. Cor. of Harmony and Hudson Sts

$6,870

Philadelphia Stock Exchange, 125 Hudson St.

$5,560

Nos. 304-6-8, 433-35-37 Chestnut St.

$28,200

Nos. 1101 to 1131 Chestnut St., (16 stores)

$56,000

Girard St., from Eleventh to Twelfth, (40 houses)

$33,839

Market St., From Eleventh to Twelfth  (22 stores)

$32,812

Nos- 31, 33, 35 S. Eleventh St.

$2,900

No. 119 N. Eighth St.

$900

No. 3 Winfield Place

$225

Nos. 19, 21, 23 , 25, 27  S. Fifth S

$6,525

Front St., above Market, (11 stores)

$13,563

Nos. 103, 105, 107, 109, 111 Church St., (5 stores)

$4,900

Nos.  25, 27 Hudson St.

$850

Water St., above Market, (11 stores)

$19,800

Delaware Ave. above Market St., (5 stores and 3 piers)

$18,100

Fairmount Ave., from 5th to 6th St., (14 houses)

$6,100

Lot N. W. Cor. 6th St. and Fairmount Ave.

$1,815

North Side of Brown St., from 5th to 6th Sts. (12 houses)

$6,300

South Side of Brown St., from 5th to 6th Sts. (4 houses)

$2,400

Fifth St., Fairmount Ave. to Brown St., (10 houses)

$7,800

Sixth St., Fairmount Ave. to Brown St., (18 houses)

$13,650

Marshall St. Farimount Ave. to Brown St. (11 houses)

$6,150

527 Acres of land in 1st and  26th  Wards

$8,228

Total Rent

$320,067

 

 

 

This list was attached to the 1882 Board Report and strangely  “Girard’s Farmhouse” is not listed.  The 587 acres of land in the 1st and 26th Wards is mentioned but not the farmhouse(s) on that land.  Also, attached to this report is a list of the Estate’s 14 farms in the 1st and 26th Wards.  The location of the farmhouse would have been in what the report calls “Farm No. 4--Between Porter and Johnston, and Twentieth and Twenty-fifth Sts. containing 65 acres.”  Could it be that the farmhouse, if there, was considered so insignificant that it was not mentioned?  Perhaps it is not mentioned because it was not revenue producing.  What makes this more puzzling is the fact that a 1909 newspaper article reads “Old stonehouse in the Neck razed for improvements and to make way for new buildings.  Famous landmark was once the house of Stephen Girard.  The Stonehouse was built in 1756 by Thomas Willing.  A short time later he sold the place to Stephen Girard.  According to tradition in the neighborhood, it was one time used by the great merchant as a residence and is still owned by the Girard Estate.  They are directing the work of razing the building.”  The article indicates that the house was vacant for the last fifteen years and that in the past it was used at various times as a residence, a factory, storehouse, blacksmith and during the Civil War it was a prison for Confederate prisoners-of war.  The house stood on Stonehouse Lane, near Front Street and Packer Avenue and would have been in Farm No.13.

In 1883, the old Girard Bank was completely renovated inside and rented to Peoples Bank.  The Girard Estate offices that had been at 19 S. Fifth Street were moved to 1138 Girard Street.  On December 27, 1886 the Estate took possession of the newly completed building at Eleventh and Market Street.  This department store was built to be rented by Hood, Bonbright and Colonial, who later were bought by Snellenberg’s Department Store, and the building was described as “the largest and most imposing of its kind in the city”.  Six other stores were being built in that block[6] and cost the estate a half-million dollars, a great amount of money in those days.[7]  By the end of 1890, that block, 11th to 12th of Market Street,  was nearly completed.  Nearly all the store were rented and construction of the new Reading Railroad Terminal, across the street, was expected to make the new stores the most valuable rental properties in the city.

In 1889, the real estate holdings within the city produced huge rent money,$396, 302, the largest ever.  Also, “the income from the 35,407,710 tons of coal shipped this year has never been equaled in the history of the trust”.  Also, this year the Estate began building homes at 25th and Poplar  Street, a five acre section of the Peel Hall farm that was not enclosed within the College wall.  Construction of these beautiful row houses continued into 1892 and they were in such demand that they were leased before they were completed.

A detailed map of the Estate’s south Philadelphia farms is appended to the 1890 Board report.  In the area of today’s Girard Park, the map shows a cluster of nine buildings, one I assume to be today’s Farmhouse.  Near 22nd and Ritner there is a cluster of five buildings, including a large furniture factory built by the Estate and rented in 1890.  That factory was the first construction since Girard’s death, in south Philadelphia.  At 28th and Ritner there is another cluster of four buildings.  Near 23rd Street and the Naval Base there is a cluster of 6 buildings. Near 3rd and Shunk there are two buildings. None of these buildings were ever included on the list of rental properties attached to earlier Board reports.

In anticipation of developing the south Philadelphia farms, the City began building new streets and installing utility lines in 1892.  Also in 1892, the first electric lights were placed on Delaware Avenue and Front Street, paid for by the Estate.  Conforming to Girard’s Will, large amounts of money were spent each year removing wooden buildings in the city and maintaining Delaware Ave and adjacent streets.

In 1894, the eastern boundaries of the farms at 17th and Porter were “square off” by additional purchases to configure the presently owned properties to the new streets being built. The 1895 report is the first since Girard’s death to mention his “country residence”, what we today call the Farmhouse.  The city intended to confiscate 26 acres of the Estate to be set aside as a park.  Instead, the Board suggest that it would develop Girard Park which would “contain the country residence of Mr. Girard”.

In 1894 the Estate was valued at $14.5 million but revenues had decreased because of a country wide major depression.  Between 1863 and 1895, the receipts from the 32 million tons of coal shipped from the Estate’s coal lands amounted to $11.2 million. It was the coal revenues that enabled additional construction in the College that led to the school’s dramatic population  increase (Refer to Chapter 4).

In 1896, construction of the thirteen story Stephen Girard Building at Girard and 12th Streets began and when completed it was expected that the Board’s offices would move there from 120 S. Third Street, the building rented to the Girard National Bank and formerly the banking house of Stephen Girard.  The new building was designed by James H. Windrim, a Girard College graduate, and the contract was awarded to Doyle & Doak.[8]  The Stephen Girard Building formerly opened on December 18, 1897 and it was nearly completely rented. The Board moved to the new Stephen Girard Building on November 21, 1898.

A fifteen year lease, to commence Jan.1, 1898, was granted to Snellenburg & Company to operate a department store in the Estate’s 1120-1142 Market Street building.  The demand for anthracite coal declined and most of the mines were worked less than half of the year.  Chestnut, Pea, Buckwheat and Rice coal had become more popular and were being shipped from the Girard mines.

The Estates impressive Mariner and Merchant Building was completed in 1901 and a power plant for all the Estate’s buildings in today’s Society Hill area was placed into operation.  Also, inside renovation work began to the Bank of  Stephen Girard, then rented to the Girard National Bank.   In 1903 the Estate bought  the nearby four story Frederick Brown Building, at the corner of Fifth and Chestnut.

In 1903, plans were drawn for the first homes to be built on the south Philadelphia farms.  They were intended to be built on  the north side of Porter Street from 17th to 18th.  Eighteen semi-detached house, the first built in what became know as the Girard Estate in south Philadelphia, were built in 1906 and addressed 1701-1735 Porter Street.  Most were rented before they were completed.  Another row of houses, 1801-1835 Porter Street was being built in 1907.  In 1908 ninety-seven new houses were being built on Porter and Shunk Streets and on 17th, Colorado, and 18th Streets.  All of the homes in the project would receive their electricity and heat from a central heating plant that the Estate was building at 20th and Oregon Avenue.  In 1909, an additional 72 homes were being built between Porter and Shunk Streets on Cleveland and 19th Streets.  With the completion of these homes there would be 205 houses in south Philadelphia that cost the Estate approximately $715,000 to build and their rents were expected to yield $85,000 annually.  In 1910 Garnet, 20th and Shunk Streets where completed and at year’s end  281 were completed or near completion  and plans to renovate Girard’s farmhouse were being made.  Near 20th and Shunk Streets a lot was selected for a Free Library to be construction using, like all Pennsylvania libraries, Andrew Carnegie funds.

Another 54 homes were built in 1911, bringing the total to 335.  In 1912 building continued and the number of houses would soon number 371. In 1913 rentals for 316 completed homes  amounted to $174,126.  Houses were beginning to be built on the four streets facing Girard Park and in 1915, Girard Park was finally completed and the Board was still talking about renovating the farmhouse.  The completed south Philadelphia Girard Estate housing development contained 404 two story houses, 77 three story houses, a store, and flat-house building.  They yielded $419,238 yearly in rents.  The garages were built in 1930.  As of this writing, 1999, only the garages still belong to the Estate.

Every year the properties of the Estate continued to grow.  The 1905 report presents a detailed financial statement for the properties listed in the following table.

 

Properties Belonging to the Girard Estate in Philadelphia in 1905

 

306 to 312 S. Second Street

four-story brick stores and dwellings.

217 Delancey Street

1 three-story brick dwelling.

301, 307 & 309 S. Philip Street

3 four-story brick dwellings.

315 S. Philip Street

1 two-story brick factory

304 to 314 S. Philip

6 four-story brick dwellings (tenements)

206 Spruce Street

1 four-story brick dwelling (tenement)

326 to 334 Spruce Street

6 four-story brick dwellings

3rd and Chestnut Streets

Mariner and Merchant Building

116-126 S.3rd Street

1 three-story marble bank building

132, 134 & 136 S. 3rd Street

3 four-story office buildings

 

with a two story printing office in the rear

25 & 27  S. Orianna Street

1 three-story brick factory building.

29 & 31  S.  Orianna Street

1 vacant- lot in rear.

125 S. Orianna Street

1 three-story office building

433-437 Chestnut Street

1 four story office building

439-441 Chestnut Street

1 five story office building

23-27  S. Fourth Street

1 four story warehouse

1101-1131 Chestnut Street

16 four story brick stores

1100-1142  Market Street

1 six story department store

1100-1124   Girard Street

13 four story dwellings

23-27 S. 11th Street

3 four story brick stores

Stephen Girard Building

14 story office building

119 N. 8th Street

1 three story and half brick store

727  Appletree Street

1 four story brick factory building

10 and 12 N. Delaware Avenue

2 four-story warehouses

14 N. Delaware Avenue

1 four-and-a-half-story warehouse

16 N. Delaware Avenue

1 five-story warehouses

18 N. Delaware Avenue

1 four-and-a-half-story warehouses

 9 and 11 N. Water Street

2 three story warehouses

13 to 19 N. Water Street

2 three and a half story warehouses

21 to 27 N. Water Street

4 five story warehouses

2 1 to 25 N. Front Street

3 six story warehouses

27 and 29 N. Front Street

2 five story warehouses

18 to 20 N. Front Street

2 four story warehouses

22 to 30 N. Front Street

5 four and a half story warehouses

103 to 111 Church Street

5 four story warehouses

219-223 Church Street

3 four story warehouses

Piers1 and 2 N. Delaware Avenue

 (303 ft. 8 1/2 in. river frontage)

Water lot at foot of Market Street

 

501 Fairmount Avenue

1 four-story brick store and dwelling

503 to 527 Fairmount Avenue

12 four-story brick dwellings

529 Fairmount Avenue

1 four-story brick store and dwelling

Lots on Fairmount Avenue near 6th & Marshall Streets

 

501-521 Brown Street

11 four-story brick dwellings

801 N. 6th Street

1 four-story brick dwelling

514 –521 Brown Street

4 four-story brick dwellings

702-720 N. 5th Street

10 four-story brick dwellings

422 N. 6th Street

1 three-story brick factory building

712-726 N. 6th Street

8 four-story brick dwellings

711-721 N. 6th Street

10 four story brick dwellings

701-721  N. Marshall Street

11 four story brick dwellings

2428-2438 Poplar Street

6 three story brick dwellings

886-894  N. 25th Street

5 three story brick dwellings

574 acres of farms in S. Philadelphia with buildings*

 

Third Street Power House

 

Stephen Girard Building Power Plant

 

*including a furniture factory, church, baseball park, brick making factory, oil refinery and wharf.

 

 

The Market Street Elevated/Subway was being constructed in 1906 and a connecting loop passed through the old Girard Water Street property and the excavation uncovered a sub-terrain containing two levels of barred rooms where Girard apparently stored merchandise beneath what had been his house.[9]

In 1907, a new ten story building, to be named The Lafayette Building, was being built by the Estate at 5th and Chestnut.  In 1912, the Board moved again, this time from the Stephen Girard Building to the Lafayette Building.  In 1911 the Estate grossed  $2 million, mostly from real estate rentals and $677,638 in royalties from the two million tons of coal shipped.  In 1912, the earned interest rate amounted to 4.3%, not much by today’s standards.  The 1914 Board report lists the rental receipts from properties owned by the Estate in the City.  The list shows an amazing accumulation of properties, for example:  they owned 22 buildings, factory, stores and dwellings near Second and Spruce Sts.; seven banks, office buildings, factory, and lots near Third and Chestnut; the Merchant and Mariner, Lafayette, and Stephen Girard Buildings; 20 stores and 13 dwellings near 11th and Market; two covered piers, 33 warehouses and one water lot near Front and Delaware; 68 dwellings, 2 stores, and ground near 5th and Brown; 11 dwellings near 25th and Poplar; 401 dwellings near 18th and Porter; 450 acres of farmland in South Philadelphia; three power plants; thousands of acres of coal lands and an upstate town; three reservoirs and a water company.  Receipts from these properties were intended to sustain the cost of operating Girard College.  In 1914 they sold a large vacant farm bounded by Porter, Shunk, Second and Third and since then most of the properties listed above have been sold in spite of Girard’s Will that directed that none of the properties should be sold but instead be held as investments to sustain the College.

On Girard Street in downtown Philadelphia, the houses were removed in 1916 and a new department store was constructed, to be occupied by N. Snellenburg’s under a lease to expire in 1936.  Snellenburg’s was already leasing a nearby Estate building.  In 1917, the Estate leased sixty acres of its South Philadelphia lands to the U.S. Government to construct the U.S. Army Quartermaster Corps warehouses.  Remember, although not mentioned in the reports, United States was embroiled in World War I and government facilities were expanding everywhere.[10]

In 1919, Owen J. Roberts, who later became a U.S. Supreme Court Justice, was appointed to the Board and remained for eleven years.  In 1921, the Estate sold its real estate at Fairmount Avenue, from 6th to Marshall Sts. and at 306-312 S. 2nd Street, 217 Delancy Street and 727 Appletree Street.  No reason for the sale was mentioned.  In 1925, the Estate owned twenty-eight warehouses, near Front Street and Delaware Avenue, that yielded  annual rents of $59,000.

In 1926 the Estate grew by nearly $5 million, probably because of the inflation that existed for several years prior to the 1929 stock market crash.  Of the total $77.8 million, $35 million was the assessed value of its  real estate.  The list of other investments was growing rapidly each year.  There were many investments in municipal bonds and stocks, probably a smart investment at the time, realizing how so many municipalities were growing and building.  In 1927, Albert M. Greenfield joined the Board of Director’s.  Those familiar with Philadelphia history recognize him as one of the City’s smartest land speculators, real estate brokers and owner of one of Philadelphia’s largest real estate agencies.  In 1928, investments were paying significant receipts.  Rents and royalties from the coal lands amounted to $2.1 million and the real estate in the city generated $2.3 million.  Interesting is the fact that the Estate paid taxes of $624,542 on the real estate in the City.

The far reaching, never discussed or appreciated, value of Girard’s money can be seen in the 1929 Board Report.  The Estate was heavily invested in stocks of and loans to many municipalities such Hanover, Reading, Upper Darby, Clymer, Forest Hills, Fountain Hills, Mt. Oliver, Wilson , Allegheny,  Chester, Easton, Erie, Johnstown, New Castle, Philadelphia, Pittsburgh, Scranton, and Wilkes-Barre:  and these school districts Abington, Manor, Nether Providence, Plains, Upper Darby, West Mahonoy, Hamstead, Media Nanticoke, Oakmont, Bethlehem, Sharon and Philadelphia.  The number of different municipalities and school districts totaled sixty-five and approximately $40 million was invested in them.  Other investments were in the State of Pennsylvania, the United States Treasury, Girard Water Co., Reading Railroad, and the John Wanamaker Store.  Then too, about $1000 was being spent yearly to maintain recreation fields in South Philadelphia..

In 1930 the Estate value was at $85.4 million, an increase of $3 million in 1929, the year of the stock market crash. Apparently the stock market crash in October, 1929 did not have an immediate effect on the Estate.  In 1930 portions of the Girard Estate lands were condemned by the city and used for the city’s League Island Golf Club (later renamed Roosevelt Golf Club) and for that land the Estate received a measly $612.62.  That golf course today is worth several million dollars.

In 1937, for the third year in a row, the Estate’s value declined because of reassessments  associated with the depression, but the Estate still collected $1.6 million this year in city rentals.  The 1935 report explains in detail the evolution of the Board of City Trust and the changes to it that occurred since the opening of the College.

In 1940, for the seventh consecutive year the value of the Estate declined, allegedly because of property reevaluation.  It was valued at $83.7 million including $40.7 million in real estate.  In 1941 the Board sold a property at 21st and Johnson Street for $156,370, a large amount of money in 1941.  In 1949, the city block bounded by 18th, 19th, Johnston and Bigler Street was condemned by the City so that it could be used for a playground and for it the Girard Estate received only $42,600.  In 1949 the Estate was receiving nearly $3 million yearly from rent of real estate within the city and this was the year that they began to consider selling the Girard Estate homes in south Philadelphia. 

John A. Diemand, a Girard College graduate of the class of 1903 and the Executive Officer of the Insurance Company of North America, was elected President of the Board of City Trusts in 1950, the year the decision was made to sell all the Girard Estate south Philadelphia houses.  That same year, G. Curtis Pritchard, also a graduate and employee of the College became the Board's secretary.  Since all the homes were heated from a central heating plant it was necessary for the Estate to spend $314,440 to install heating systems in the homes so that they could be separated from the Estate’s central plant.  The Board not anticipating the future rapid rise in real estate values, and disregarding Girard's Will restricting sale of any property, decided to sell the nearly five hundred homes.  Granted, the Estate was temporarily losing money on the homes because government rent controls limited increases in rental fees.  The homes were sold for between $9,000 and $12,000 and today most sell in excess of $130,000.  In 1951, three hundred and forty-eight (348) houses in the S. Philadelphia Girard Estate were sold for $3.7 million, an average of $10,668 each,  and considering the costs to build the homes, the profit was only $1.2 million excluding what was made in rentals.  The power plant was closed and rented to the Government for $10,000 a year, and four acres of ground were sold for $46,000 on which the Tasker Project was build by the Philadelphia Housing Authority.  Another 133 houses were sold in 1952.

The Board sold, in 1954, the Lafayette Building  at 5th and Chestnut Street for $1.5 million.  Other nearby properties intended to be included in the Independence National  Historic Park were also sold.

Harry G. Schad, a Girard College graduate and executive at the Atlantic Refining Company became a member of the Board of City Trust in 1956.  Since 1861, when the Estate started leasing the coal lands, 143 million tons of coal were shipped.  In 1957 the value of the Estate excluding real estate was $63.4 million and the income from it invested amounted to $2 million or a little over 3%.

In 1969 the Residual amount of the Estate was about $79 million and had remained about the same for nearly ten years and most of the time it was yielding approximately 3%.  In 1970, only $632,875 was received from real estate rentals in the city and real estate rentals outside the city lost money.  Only 6219 gross tons of coal were shipped, far from the 2-3 million tons shipped early in the century.  Whereas years ago there were 11 coal leases, this year there were only two.

In 1991, Louis Esposito was the President of the Board[11], and still is in 1999, and the Estates value was $164,977, 422 of which only $35 million was in real estate. Income from real estate was $7 million and income from investments was $12 million.

The 1993 Report reflects that the Board is administering one hundred and twenty trusts, the largest being the Girard Estate which in 1993 was valued at $207,842,000 exclusive of the value of the real estate.  Ten million dollars was spent to administer the College and in addition nearly another million was spent on long-term projects/major expenses.  The income from investing $195,703,000 of the Residuary Fund was $9,740,000, only 5 percent.  Receipts from real estate netted $3.4 million from a gross of  $10.9 million.

 

EVALUATION OF THE ESTATE GROWTH

Is the Stephen Girard legacy in trouble?  Did the estate's value increase proportionately to the increase in the growth of the nation's economy?  Naturally, the cost to operate the College must also be considered when determining the growth of the Estate.  It appears that conservative or unwise investing has caused the estate to lag behind the stock market and economical growth.  Even in recent years the growth is not impressive when compared to the money many people are making from investments.  In 1992, the Estate invested $185,018,000 and the return was $11,277,000 or about 6 %.  The investment yielded 9.6% in 1993.  In 1994 an income of $8.5 million was received on investments of $193.5 million, a return of 4.4 %.  In 1995 the Estate received $8.3 million on an investment of $212.4 million, less then four percent.  The return was worse in 1997 when they received  $8 million from an investment of $270.7 million.  One can safely compare the period 1993 to 1995.  From 1990 to 1995 the Dow Jones Average rose from approximately 2800 to 6700, approximately 139%.[12]  

Although some of the Estates’s growth appears impressive when considered by itself,  the amount is not so impressive when compared with the nation's overall financial growth and the inflation that has occurred since 1940.  In comparing the above statistics, consider that between 1966 and 1991, inflation rose 320 percent.[13]  In 1915, seven cents bought what a dollar bought in 1992.  Thereafter it was 14 cents in 1920, 12 cents in 1930, 10 cents in 1940, 17 cents in 1950, 21 cents in 1960, 28 cents in 1970, and 59 cents in 1980.  Moreover, the Dow Jones Industrial average since 1940 has increased from 170 to approximately 6700.  Using the growth of the Consumer Price Index, a real measure of buying power, $277 was needed in 1985 to buy what $100 bought in 1970.  The Estate's growth, therefore, has not kept pace with the national economical growth and because of inflation its buying power has diminished.

 

GIRARD ESTATE STATISTICS

 

 

 

 

 

YEAR

RESIDUARY*

OPERATING COSTS

NO. STUDENTS

COST/STUDENT

 

 

 

 

 

1880

1,286,350

$350,112

872

$402

1890

2,219,900

$514,061

1,378

$373

1900

5,126,650

$488,852

1,547

$316

1910

7,480,250

$563,342

1,511

$373

1920

19,641,800

$1,391,883

1,552

$896

1930

49,285,578

[14]$4,085,952

1,610

$2,679

1940

43,832,402

$1,747,581

1,733

$1,010

1950

66,499,051

$2,163,647

1,305

$1,647

1960

 

NOT REPORTED**

812

 

1970

79,674,484

$3,221,198

496

$5,965

1980

89,593,523

$5,147,471

321

$16,035

1990

161,999,031

$11,689,296

524

$22,308

1991

164,977,000

$12,601,590

532

$23,687

1992

198,027,000

$12,338,000

499

$24,725

1994

210,687,000

$9,946,000

548

$18,150

1995

229,440,000

$9,789,000

559

 

 

**In 1960, when a private Board administered the estate, no public financial report was made.

*  These amounts exclude the value of the real estate.  In 1992 the residuary amount was expressed as market value rather than the heretofore-invested value.

 

            These financial figures are especially alarming when one considers Stephen Girard's instructions.    He instructed that his property not be sold but should be used to sustain the College, but nearly all of the revenue-producing real estate has been sold.  Until recently, the old real estate that remained was surprisingly yielding only about $2 million yearly out of gross receipts of nearly $10 million.  Although the estate still owns many acres of coal mines, their revenue producing value has declined, netting only about a $1 million annually in most recent years.  Girard's foresight was better than that of the people who have administered his estate for the past 50 years.  Imagine what 583 acres in south Philadelphia would be worth today, or the value of Girard's Society Hill, downtown, waterfront, and Pocono properties.  Consider that the Girard Estate houses were sold on average for approximately $11,000 each in the 1950s and today sell for at least $130,000.  What about the camp in the Poconos that cost $4910 that was sold for $100,000, and today is worth about seven million?    The value of property has increased far more than the invested money from its sale and one needn't have been a genius to predict how real estate values would sky-rocket with the ever-increasing population demands.

            Girard anticipated that rental from his properties would perpetuate his College.  Today, with most of the property sold, that option no longer exists.[15]  Today, nearly all the money to operate the College is dependent on the investing skill of the financial advisors, and that hasn't been very impressive.

Things have changed in the last few years.  Apparently the present Board realizes the potential value of real estate investments.  The Estate has purchased a one third share of the Bellevue Hotel and purchased another property now leased to an up-scale restaurant.  Additionally, a major bond issue, $26 million, has been issued under the name of Girard Estate Facilities Leasing Project to purchase upstate properties that are apparently leased to the State.  Simultaneously, the Estate has speculated in the establishment of Girard Estate Coal Mining Co, using $20 million in bond issued apparently intended for capital improvements to process residual coal.  Heretofore, much of the success of the Estate’s growth came about by leasing mines and receiving royalties from coal shipped.  The 1997 statistics indicate that shipments of coal have been substantially reduced, 800,315 tons in 1992 to 372,579 in 1997, so for the first time the value of the on hand coal inventory is counted as assets.  As a result of these investments, the liabilities of the Estate has risen from $8.1 million in 1996 to $57.6 million in 1997.  Time will tell how successful these new ventures will be.



[1] Much of the information in this chapter was obtained from Board reports available to the public at the Philadelphia Main Library at Logan Circle.  They are sometime difficult to understand with respect to the Estate’s value because some years they express the value only of the Residual amount, sometime the value represents the total including real estate value and investments.

[2]Another report gave the date as June 30, 1869.

[3]Board Report for 1876

[4]Thereafter, the  Steward of the College lived in it for many years.

[5]In 1891, all the Girard lands in Kentucky, most of little commercial value, were sold for only $2932.

[6]This was the block in which Girard College was originally intended to be built.

[7]When Snellenberg’s closed, the building became the Philadelphia Community College.

[8]Floor plans for the building are included with the report.

[9]From a newspaper article on a 1906 Record

[10]Today, 1999, the Government is closing this facility after having served in WWI, WW II, Korean, Vietnam, and Desert Storm wars. )

[11]The remaining members in 1997 were:  Vice Presidents Melvin C. Howell, Isadore A. Shrager, Esq., and John J. Egan, Jr.  Other Directors were:  M. W. Baehr, Sr, Dominic M. Cermele, Ronald R. Donatucci, Ann G. Eisman, Vincent J. Fumo, Judith J. Jamison, Anna C. Verna, and Stephen R. Wojdak, Esq.   Mayor Edward G. Randell, Mayor and John F. Street, President of City Council are “Ex Officio” members.

[12]The Philadelphia Inquirer on June 22, 1999 indicated that the Dow Jones and the S & P average annual return between 1973 and 1998 were 13.6%.

[13]Department of Commerce.

[14]High because of money set aside or committed for new construction.  The cost/student is therefore inflated.

[15]The Philadelphia Inquirer recently reported that the Board of Directors of City Trusts has $4 million invested in what once was the Bellevue Hotel, recently renamed Park Hyatt, and it is believed that two other downtown Philadelphia properties were recently bought.  Also, the newspaper reported that some upstate properties were purchased.



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