Mid Atlantic Real Estate Journal — Brokerage Directory — July 26 - August 15, 2013 — C
www.marejournal.com
B rokerage D irectory
By James J. Reis The North American Land Company The First R.E.I.T.
A
little known story in American History is that of Robert Morris
the company objectives and benefits. The stock promised a return of 6% per annum for 15 years at which time the land hopefully would have appreciated, and the accrued value would have been given to shareholders. Well like the late 1980’s, the 1780’s looked like a real estate boom, but by the mid to late 1790’s real estate investment was a bust. Rural locations and timing certainly added to the real estate bust. Morris sent his son-in-law, James Marshall (the brother of Chief Justice John Marshall), to Europe to
sell the stock. Things did not go well for Marshall and the other agents as Europe was gearing up for the Napoleonic Wars, and real estate speculation was not to be trusted. Morris also has serious problems with poor titles and creditors looking for payment. Things looked pretty bleak for Morris by 1797. So bleak that he was a house pris- oner in his own him “The Hills,” which is near Boat House Row along side the Schuylkill River in Philadelphia. Morris finally gave in, said goodbye to his wife and six grown children, and went off to
an unknown future in Debtors prison. To think that someone who was once the wealthiest man in America, now in his 60’s, someone who signed the two most important documents in history, the United State Constitution and the Declara- tion of Independence, was now off to fend for himself in prison. Entering prison in February 1798, he writes to his creditors and partners often up to 10 to 20 times a day. In a personal letter to his son Thomas he asked how his wife and son William were doing (during continued on page 26C
and his involvement with the North American Land Com- pany. The N.A.L.C. was, and is considered, the largest land trust in American History, and is one of the first publicly traded Real Estate companies. In the mid 1770’s Morris, an extremely wealthy Phila- delphia merchant, backed the idea of independence from his native country, England. If the colonies had lost their effort for independence, we would certainly live in a different world today. Morris, known as the “fi- nancer of theAmerican Revolu- tion,” found inventive ways to fund the revolution and; kept his friend George Washington, and his troops fed, clothed, and armed during the long war with England. In the end, the Americans prevailed. No doubt feeling exuberant after the war, Morris turned from a Merchant Prince to become a banker, and subse- quently a Real Estate Inves- tor. Always the entrepreneur, Morris founded the Bank of North America, the first com- mercial bank in the united states. Never lacking for new business interests, by the late 1780’s he was a huge landowner and speculator. He believed in European expansionism to the Americas and purchased inexpensive land in rural Penn- sylvania, Virginia, North Caro- lina, South Carolina, Georgia and Kentucky Pretty soon he was in the same situation that many Real Estate Investors were in during the late 1980’s, and he stated to look for a way to settle with his creditors. Instead of calling it quits and doing what he should have done by going back into the Mercantile Trade Business, he bought more real estate. By the mid 1790’s Morris and two of his partners, James Greenleaf and John Nichol- son, pooled their land and formed what must have been a very novel idea in its day, a land company called the North American Land Company. The purpose was to raise money by selling stock secured by the real estate. Six million acres were put into the trust in the six states. Formed on February 20,1795 the partnership set out to sell the stock for $100 per share. Every share represented 200 acres of real estate. Before
you bought the land you got a prospectus, which outlined Robert Morris
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