# Zeckendorf  ## Metadata - Author: [[William Zeckendorf]] - Full Title: Zeckendorf - Category: #books ## Highlights - The secret of any great project is to keep it moving, keep it from losing momentum, and this, for me, meant a constant flow of telephone calls and trips, often by company plane, to Montreal, Chicago, Washington, Cleveland, Philadelphia, Denver, and points west. ([Location 124](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=124)) - Tags: [[blue]] - unexpected and phenomenal delays (especially in urban-renewal projects) between the start and actual finish of our building programs greatly increased carrying and interest costs for these projects. ([Location 129](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=129)) - Tags: [[blue]] - I have never been afraid of debt, because debt is what gives you leverage, and I also knew our projects were excellent ones. ([Location 134](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=134)) - Tags: [[blue]] - We had been loaded down by too many projects that were taking too long to be realized, and we could no longer control the direction we were going in. ([Location 138](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=138)) - Tags: [[blue]] - Note: Multiple risky projects introduces systemic risk. If a large subset of project randomly fail simultaneously (eg 2008 housing crisis), then the whole thing topples. Need to understand how many simultaneous failures your company can withstand and plan accordingly by limiting leverage - In moments of crisis, one's world tends to become simplified, and its people and events fall into distinct categories. ([Location 153](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=153)) - Tags: [[blue]] - After much deliberation, Lazard Freres, which in times past had made more than seventy million dollars from various Webb & Knapp ventures, agreed to provide some capital, but there was a condition: Henceforth they would have the right of first refusal on all General Property Corp. projects. Such an arrangement would, in effect make us lifelong vassals of Lazard. We turned down this offer and set up the new company on a more modest scale with our own financing. ([Location 169](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=169)) - Tags: [[blue]] - Note: Never shackle yourself to a single business. Think Gates and IBM - Having little capital of our own, we reverted to the tactics and style of the early 1940's and became packagers and promoters for other people. Our reward was in the form of fees or a piece of the profits. ([Location 189](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=189)) - Tags: [[blue]] - I was enrolled in the local school, and on my first day there something happened that taught me a very important lesson. It was the classic new-boy situation; I was teased and taunted, and the hazing went on during most of the day. I finally turned to the biggest of my tormentors and said, "All right, meet me outside." Everybody knew there was going to be a fight. When school was dismissed, a gang of kids was milling around by the steps of the back yard, waiting. My opponent was waiting too. I was frightened, but there was nothing to do about it. I took off my coat and started running down the stairs at my enemy. My seeming eagerness must have startled him, for I noticed that he wilted just a bit. The fact is, I was expecting to get knocked down and was rushing in to get it over with, but when I saw him flinch, I gained new courage. He gave up after one or two punches. This minor incident was soon forgotten by almost everyone but me; it taught me a lesson that later applied in business every bit as much as it did in a high-school playground: If you show hesitancy or fear, you may already be half-defeated. If you put on a bold front, and fight with everything you have, you can win. Moreover, once you have won a few battles, you are usually left alone: in the jungle, no animal thoughtlessly attacks the lion. ([Location 341](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=341)) - Tags: [[blue]] - Note: Go at everything full tilt. If you go half hearted, you will lose - I was an untrained new employee, and Sam put me to work in the housekeeping end of the business. This consisted of collecting rents, placating those tenants with service complaints, and buying shades, awnings, soap, and fuel for Sam's various properties. Having neither interest nor patience with this end of the business, I kept popping into Sam's office with suggestions and ideas that might get me into the sales end of the operation. After many months, I finally got my chance. ([Location 360](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=360)) - Tags: [[blue]] - Note: Don’t be too proud to take on “lower status” jobs. But even when in one of those jobs, do what you can to advance. Always keep your eye on the ultimate goal - Of the prospective tenants I approached, perhaps one out of five would come over to 32 Broadway to have a look. Of every five that looked, perhaps one would take a lease, but that was enough. Bit by bit I began to fill our building. By early fall, when my uncle was due back from Europe, I had all but two small offices rented. ([Location 375](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=375)) - Tags: [[blue]] - Note: “Do things that don’t scale”. Getting those first customers requires tons of leg work. Being willing to put in that work - He had no property-management department. I still don't know why, but I talked Gans into creating a management department which I would head. I ran this business for a few months, but I became more and more restless. I was a late riser in those days, and I also went to bed very late, and it was a dark-of-winter's-morning call from a tenant complaining about plumbing that finally convinced me I was in the wrong field. ([Location 389](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=389)) - Tags: [[blue]] - My commissions on sale of the fee and leasehold of that building came to eight thousand dollars. I could marry. I was twenty-three and had never before had so much money. It made me uncomfortable, and I thought we had better spend it quickly. ([Location 407](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=407)) - Tags: [[blue]] - Note: Extremely unhealthy spending habit and mentality. Fight this same mentality in yourself, be frugal and invest - But it was such developers as Fred French and Henry Mandell who were New York's builders of vision. Mandell, for example, built office buildings at 1 and 2 Park Avenue and created London Terrace, the excellent block-long apartment complex on Twenty-third Street on New York's West Side at Ninth Avenue. Mandell improved any property he touched, and it was to Mandell that I made my next big sale, by contacting Otto Kahn. ([Location 434](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=434)) - Tags: [[blue]] - Generally there are three categories of real-estate investors—those who borrow nothing, those who borrow the maximum, and those who borrow conservatively. The nonborrowers, such as the Astors, who owned all their properties free and clear, could ride through almost any storm. Predictably, those speculators who borrowed the absolute maximum on their projects were among the very first to get wiped out. And yet, it was the conservative investors who ultimately suffered the most. Speculative builders, who were mortgaged to the hilt and beyond it, were the first to cave in—and the first to have court-appointed receivers take over the mortgage or bond holders. When a receiver takes over a property for the mortgage holders, he is not faced with the costs that faced the previous owners; he is accountable only for real-estate taxes and payroll. This means his total costs are sharply cut and he can greatly reduce rents for the properties he runs in order to make them attractive to tenants. Furthermore, being in a sense a political appointee, he may (especially in a time of chaos) want to make a career of his appointment. If this was the case, the worst thing that could befall such a receiver would be to make such excellent profits that his property soon recovered and he was no longer needed. The best thing that could happen to him would be to receive just enough income to pay the minimum charges needed to keep his particular ship afloat, while maintaining his own and his lawyer's fees. When the new management cuts rents, it is in unfair competition with the building next door, which has to carry the weight of a conventional mortgage and rents. As a result, those buildings in receivership soon send their conservatively mortgaged neighbors to the cleaners as well, and that is exactly what occurred in the 1930's. ([Location 501](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=501)) - Tags: [[blue]] - To keep things from completely falling apart, Shields, the company vice-president in charge of mortgages, would readily make mortgage loans that virtually ignored the matter of adequate payments needed to pay back the principal. He would renew existing mortgages indefinitely on the theory that the rise in value of the land would eventually be great enough to recover any principal. ([Location 522](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=522)) - Tags: [[blue]] - Note: Long term thinking - instead of panicking from the short term loss of interest payments, he waited until the properties recovered value - Shields was right, in the long run, but in the long run we are all dead, and he died before his point could be proved. ([Location 525](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=525)) - Tags: [[blue]] - Note: Sometimes the long run can be TOO long run - in 1936 Eliot Cross was trying to revitalize Webb & Knapp by bringing in new blood. In 1937 I had been the broker in the sale of an office building at 369 Lexington Avenue to Webb & Knapp. The next year, when several major tenants moved out, the building began to lose money. Webb & Knapp asked me to bring in some new tenants. I was able to repopulate the empty floors rather quickly. John Gould, who was company president, invited me to join the firm, and I accepted. ([Location 606](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=606)) - Tags: [[blue]] - Note: When you have the opportunity to impress big players, go all out. You never know what opportunities will be waiting for you because of it - I was familiar with almost every block of property in town, knew or was known to most important brokers and a great many bankers, as well as numbers of insurance men. I also brought ebullience and personal drive. If some of my partners were rich, I was ambitious. Thus, through a combination of background and personality I became the chief enthusiast, contact, and idea man for the organization. ([Location 617](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=617)) - Tags: [[blue]] - Note: Knowledge, connections, and drive will take you VERY far - This made me keenly aware that it paid to look at the real-estate business not as an end in itself but as a device for bridging gaps between the needs of disparate groups. The greater the number of separate groups (or their needs) that one could interconnect (or satisfy), the greater the profit to the innovator-entrepreneur. ([Location 716](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=716)) - Tags: [[blue]] - Note: Dissipate gradients to succeed. Find groups that are not being served and serve them, either directly or as the middleman in a marketplace (think Uber or Airbnb) - There was a gap, however, between my newly developed insights and the opportunity to apply them on any scale. Webb & Knapp didn't have the capital or credit to make a proper, profitable impact in the field of real estate. And that is the way things remained —all of us working hard, doing well, but not accomplishing anything truly spectacular. ([Location 719](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=719)) - Tags: [[blue]] - The business of selling off Astor's less desirable properties was even less difficult than I had expected and taught me anew that there are a great many nonrational though quite real factors in real-estate values. Some, for instance, have to do with whom or what a piece of land or property is associated. The inn where George Washington slept, the house where Washington Irving lived, the sword General Sheridan waggled at his countrymen—all these properties take on a certain associational virtue and value. I soon learned there was an invisible but tangible aura about the Astor properties that made them attractive: if the great Astor estate had owned them, they must have extra virtues, because Old Astor had been so shrewd. But this was only one incidental part of the attraction of these properties. ([Location 792](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=792)) - Tags: [[blue]] - Taking a reverse lesson from the Clews-mansion deal, and the opposite tack from my cash-hungry friend Mr. Blumenthal, I sold for very low cash down payments but at steep prices. In this way I got a sales price of, say, a million dollars on a property that would have sold on the cash market for $400,000. Of the million dollars, I might take $50,000 or less as a down payment, in addition to a piece of paper in the form of a mortgage. Then I would turn to the mortgage companies to sell off my paper. They would ask, "What is the price of the property?" and I would say, "One million dollars," and when they asked what we wanted from them in cash, I would suggest a peak of, say, $666,000. I would immediately follow this with the announcement that Astor would accept a second mortgage for the remaining $284,000 of the million-dollar price. The fact that Astor would take a subordinate mortgage served as a psychological guarantee, making the mortgage buyers courageous enough to take our paper. ([Location 800](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=800)) - Tags: [[blue]] - The crystal ball we used was the simple, built-in type. The only trick was not to be so awed and frightened by the present that you were not able to see the future that lay within it. In an America that had been traumatized by the Depression, I was one of those who recognized that the Depression was past and then acted on this recognition. A great many others, thinking the Depression was still with us, did in fact keep it here for themselves, out of sheer habit of thought. ([Location 840](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=840)) - Tags: [[blue]] - Note: Don’t become stuck to the past. Recognize when times have changed and take advantage. In the case of economic downturns, realize that times when sentiment is lowest can correspond to when it’s the best time to buy - We had purchased all the stock as well, and therefore the actual companies that owned the properties. On the company books these properties had an aggregate, pre-Depression book value of 3.6 million dollars. When, after a complex series of paperwork exchanges, we sold off the properties at more than we paid for them, but at less than their book value, the residual companies wound up with a capital loss of more than two million dollars showing on the books. As a result, this two million-dollar book loss became a two-million-dollar tax credit. This meant that the next two million dollars in profits, which we were able to make through the residual companies, would be tax-free. Through a number of such carefully chosen purchases of stock and sales of property, I kept Webb & Knapp a tax-sheltered concern throughout the war and for part of the postwar period. ([Location 959](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=959)) - Tags: [[blue]] - Note: Knowing the tax code well can help find loopholes like this. This is knowing the “game” of business. Rather than being a scrub and playing a self imposed harder game because it’s more “pure”, be clear about the real objective and do everything you can to get there. Leverage the existing environment and rules to get to that objective efficiently - When we bought outside New York City, we were merely putting our money where America's growth was strongest. ([Location 974](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=974)) - Tags: [[blue]] - Note: Good markets win. Put your money where the rising tide of the market will bring it along to success - I hate to bargain. If, in my judgment, a property is worth the asking price, I see no reason to try for less. A lot of shrewd dealers think this foolish, but I notice that others tend to lose more business, and to poison relationships, by trying to refine an already good bargain beyond a reasonable point. There is a much better flavor left in everybody's mouth when such haggling is avoided. I wanted the property, their price seemed reasonable to me, and so we were in business. ([Location 1017](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1017)) - Tags: [[blue]] - I never refused a phone call from a caller with a deal in hand. It was a policy that paid off. ([Location 1338](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1338)) - Tags: [[blue]] - The Indian Trail properties may now be worth three hundred dollars an acre, but what we sold the properties for were good prices at the time and followed the Webb & Knapp pattern. We could not hold all our properties, because we would need the money to meet our tremendous commitments in yet another new field. ([Location 1357](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1357)) - Tags: [[blue]] - This is what happens with a bold project, where, in the first instance, you make some sacrifices to get your first key tenants. Then, because you have a fine building, and because it catches on, rents go from a discount to a premium in value. The early leases, as they mature or as tenants decide to expand in a successful building, later take on yet another increment in value, and 1407 today may be worth thirty million dollars. Inflation, like a rising tide, comes to all ships, but 1407's value rise was based on concept and execution. ([Location 1443](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1443)) - Tags: [[blue]] - Note: If you build something great and put in the leg work to attract those initial customers, amazing things can happen - one has to realize that New York City, where you can buy anything, is really a giant, Oriental bazaar in concrete disguise. It is the greatest such bazaar in the history of man, and, true to the type, it is a marketplace where birds of a feather and merchants of a type flock together—the money lenders and speculators in one section downtown; publishing, TV, and advertising men in midtown; and the cloth merchants in between. ([Location 1539](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1539)) - Tags: [[blue]] - I recognized that we could afford to lose ground income if, by giving tenants a prestige building, we could ask for rents fifty percent greater than those in the immediate vicinity. This is what we did, and by losing $150,000 in ground rent we gained at least $400,000 a year in office rentals—and had a fine building. Based on its current leases, that building is now worth some fifty million dollars. ([Location 1555](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1555)) - Tags: [[blue]] - Note: Luxury products can command luxury prices. Sometimes going for a higher price market can beat competing by cost cutting - some advice Pei's father had once given him: that the essence of good architecture was the ability not only to conceive of great buildings but also to tie them effectively to finances and economics. Part of Pei's interest in us was the opportunity we afforded to weld design to marketing factors. ([Location 1596](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1596)) - Tags: [[blue]] - What we came up with was a reverse merger, American Superpower first changing its name to Webb & Knapp, Inc., a Delaware corporation, then absorbing my Webb & Knapp, Inc., a New York corporation. In exchange for my stock in the New York Webb & Knapp, with a net worth of forty-two million dollars, I received one million shares of junior preferred stock plus eleven and three-quarter million shares of common stock in the new Delaware Webb & Knapp. The old Superpower's sixty-three thousand shares of senior preferred (now Webb & Knapp, Delaware, preferred) had a claim on 13.2 million dollars on the merged company's assets. Superpower's common shareholders, whose assets had previously had a negative value, now held stock in Webb & Knapp, Delaware, with an asset value of sixty cents per share. As a result of this transaction, I lost (on paper) ten million dollars, because, whereas previously I had as sole owner of Webb & Knapp a claim on forty-two-million dollars of net worth, I now had, as a result of dilution by merger, a claim on only thirty-two million. Nonetheless, I now had a publicly listed company. By sale of some of my stock I could clear my personal debts. The new company had a useful tax credit by which we could conserve and reinvest a greater share of our earnings. Then too, Superpower also provided ten million dollars in new working capital when we sold off its various stockholdings. ([Location 1634](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1634)) - Tags: [[blue]] - Note: This is a masterclass in corporate restructuring. A reverse merger that ends up in a LOSS for Zeckendorff but allows him access to funding from the stock market by becoming a publicly listed company, paying off all his debts in the process and giving him capacity to expand quickly. - I found it possible to join their ranks without discommoding or unsettling them, for one way to succeed is by aiding and supporting the position of others through new or ingenious ideas or projects. This usefulness to others is in large part the reason for my own success, though there were times when we quite consciously upset other groups for our own and quite often for their own good. ([Location 1666](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1666)) - Tags: [[blue]] - With general population rising and with various service industries moving into town and seeking space, the downtown properties were renting nicely, with little or no further investment needed by the owners. The return on investment on these properties, in terms of the original investments of many years ago, were excellent. Why, therefore, rock the boat? Better a tight and assuredly profitable real-estate market than an open and uncertain one. The logic was admirably conservative. It was also utterly unrealistic, for these gentlemen were overlooking some key points. For instance, they were consistently overlooking the even greater return on investment that imaginative new building efforts in Denver might develop. ([Location 1803](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1803)) - Tags: [[blue]] - their eyes fixed on individual properties in Denver rather than on overall possibilities of the Denver area, they ignored all the many opportunities they were offered. If met imaginatively, these regional opportunities could propel Denver to a new position in the mainstream of American cities. If nothing were done, this growth and vitality would be transferred elsewhere. Only Denver's major property holders in conjunction with the local banks (which they controlled), could generate the capital and momentum to get Denver moving purposefully with the times, ([Location 1808](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1808)) - Note: Think on large scales (both in terms of capital and time). What can be done if maximum effort and power is put behind a movement? - The local realtors who were doing the appraising for the insurance companies we turned to for financing, just could not bring themselves to understand how a building that had terraces rather than stores on the ground floor could more than make up for this loss of rental space by charging higher rentals for the upper floors. They could not believe that there was prestige connected with having offices in a beautiful building. In Denver, as elsewhere, we eventually proved that beauty can be good economics. We got an unheard-of $5.85-per-square-foot rental for the two top floors, and even at this writing Mile High Center boasts one of the lowest vacancy ratios in town. ([Location 1872](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=1872)) - Tags: [[blue]] - Note: Again, luxury items (in this case beautiful real estate) can command a massive premium - Move we did, and at last, after almost fifteen years, our Denver ventures were coming to a close. ([Location 2112](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2112)) - Tags: [[blue]] - Note: 15 years developing the SAME LOCATION. It takes drive and persistence to keep up the momentum for a big project. Make sure that your big projects always keep moving forward - FROM THE VERY beginnings of my ascendancy at Webb & Knapp, I made a practice of keeping the momentum going by constantly developing new projects, some of which might bear fruit and some of which might not, and some of which might divide and interact upon other deals over the years. ([Location 2181](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2181)) - Tags: [[blue]] - Note: Reminds me of the fundamental law of portfolio management. Easier to improve returns through breadth of investments versus improvement in skill - If in 1955 and 1956 we had pulled in our horns and nursed only a few key projects along, I could have settled back as a multimillionaire and staid property holder. But with all of America before us and with so many useful things waiting to be done, I no more knew how to settle down to mere money counting than a bee in clover knows how to doze in the sun. ([Location 2215](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2215)) - Tags: [[blue]] - Note: Don’t conquer for any reason other than that ITS THERE AND CAN BE CONQUERED - We had discovered that in many cases it takes only a relatively little bit of seed money, plus quantities of effort and imagination, to get a worthwhile project under way. ([Location 2219](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2219)) - Tags: [[blue]] - A continuing series of minor forays and adventures can keep life interesting and sometimes exciting. I certainly got more pleasure from helping Helen Reid out of a tight corner than I would from buying and selling a particular piece of land, but I never let myself forget that these interesting side ventures came about because of our efforts and successes in various major projects. ([Location 2614](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2614)) - Tags: [[blue]] - The stars must have been right when we met, for each of these men had individual visions about Montreal which matched mine, so we could work together. ([Location 2637](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2637)) - Tags: [[blue]] - Note: Work with people who share your vision and are willing to stake something on it - Any real-estate man is interested in twenty-two acres of singly owned midtown city property. What was frightening most people off was its size, plus the owner's insistence on an overall rather than a piecemeal development. But it was this very aspect of the situation that intrigued me. ([Location 2656](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2656)) - Tags: [[blue]] - Note: Be attracted to possibility and a blank canvas. Don’t shy away from it - It was a competent and a pleasant design, but as I stood up in the steeply banked airplane, and looked out of the windows to the winter-gripped city below, I was dissatisfied. Something was missing. Here lay this unexploited but potentially fabulous site which only we could develop, but what we proposed to develop lacked power. As I began to sense what was missing, I said, "Henry, I want to tell you something . . . you don't make 'melly' out of a blue white diamond." The minute I explained that "melly" are merely the bits and chips left over when a great diamond has been cut, he saw what I meant. He, too, recognized that we needed something with enough critical mass to force changes on Montreal. By critical mass I mean not only the physical but also the emotional and the aesthetic impact of a truly successful building complex. ([Location 2702](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2702)) - Tags: [[blue]] - Note: Always think about how you can do things bigger and better - This issue brought in some twenty-five million dollars which almost immediately began bearing interest at 5½ percent. Since we had no income to speak of in Canada, we went out looking for short-term investments where we could put the money to work and draw it out later for the project. For instance, we used some ten million dollars of this new money to buy a group of some 277 gas stations owned by anew oil company in Canada, Petrofina. We leased these stations back to Petrofina for ten percent, which, right away, gave us one million dollars a year against our interest payments, and we later quite profitably sold off the stations as we needed money for construction in Montreal. ([Location 2745](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2745)) - Tags: [[blue]] - Note: Always looking for ways to put money to work and to leverage debt - our trouble was that nobody, not even Muir's friends, actually believed we would ever put up a project as big as we said we would. ([Location 2761](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2761)) - Tags: [[blue]] - Note: Dream so big that people don’t believe you - These two key leases were good-sized deals in themselves. The Royal Bank's lease provided 2.6 million dollars a year in rent for fifty years. Aluminium Limited's was two million dollars a year for twenty years. Next we got in the Montreal Trust Company at $750,000 per year. This came to fruition after Don Kerlin at the Trust had turned us down, but I got him on the phone, saying, "Don, I know you have said no, and I know that you mean no . . . but let's talk for a minute. . . ," and the logic of what was now taking place in Montreal was so persuasive that Kerlin took that lease and was glad of it ever after. Later we made a fine deal for another $750,000 with Trans Canada Airlines, now Air Canada, and with names such as these lined up, all Montreal now realized that our project was no dream but a great reality. The great freeze-out of 1957–1958 had cracked and thawed, and the city would never be the same. ([Location 2823](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2823)) - Tags: [[blue]] - Note: The amount of legwork he put in and creative deal making he used was insane. At every seemingly dead end, he knew the right people to call and pursued those leads until they happened. He didn’t take no for an answer - Since we had only twenty-five million dollars of our own money and fifty million promised from Metropolitan Life, we were twenty-five million short of our project cost estimates, but I gave the go-ahead signal. My observation has always been that after a certain key point you must move ahead as if a project were assured—in order to assure it—because if you wait around for all the pieces of the puzzle to fit before closing a deal, you can wait forever. ([Location 2830](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2830)) - Note: If you wait for everything to fall into place, it won’t. You need to MAKE it happen - While the British negotiations were under way, I arranged a second mortgage at a walloping interest rate, because it would be far less costly to keep the project going, even at high interest rates, than to temporarily close it down. ([Location 2845](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=2845)) - Tags: [[blue]] - Note: Always keep momentum high, even if it’s costly to do so - For all my technically trained and talented young helpers, I was principal troubleshooter for Webb & Knapp and would not have it any other way. ([Location 3017](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3017)) - Tags: [[blue]] - Note: Having technical skills as a founder is IMPORTANT. You need to be able to manage and set high level strategy, but you also should have the skills to jump into the nitty gritty if needed. All the best founders have this combination of mastering the minutiae while also seeing the higher scale, broad landscape - In matters great as in matters small, around the world as in Montreal, I find it is not logic but emotions, sometimes carefully rationalized to resemble logic, that more often than not decide most issues. ([Location 3073](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3073)) - Tags: [[blue]] - Note: This is directly Nietzsche. People think themselves rational, but in reality they are rationalizing their unconscious thoughts, feelings, and emotions. We are at base irrational beings - The lesson is that in a city, a relatively minor investment in open space can pay off handsomely in better rents for whole blocks in the area—if the city and property owners can raise their eyes above and beyond the limits of their own sidewalks. ([Location 3156](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3156)) - Tags: [[blue]] - Note: Think bigger picture than your competitors - Our associate architects, angry at the Council's blow against good design and a better city, were ready to march on City Hall in protest against the stupidity of the decision against us. But if we were to throw any more forces into the battle, the resulting publicity would only convince Metropolitan Life that the mall was indeed vital to the project. Then, if we lost, and the odds against us were great, we might lose not only the promenade but also the whole project. It took soft-spoken Henry Cobb five hours to do so, but he finally talked our allies out of staging a grand battle for a principle, in order to save a cause. ([Location 3174](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3174)) - Tags: [[blue]] - Note: Playing the optics game is incredibly important - Today some explosive events and television have made most of us dramatically aware of the situation which I have laid out in barest detail. The interrelated problems of jobs, housing, and education in the great cities we now recognize as the great challenge of our ultraurban society. In 1952 this was not the case. The outflow to the suburbs was too evident to be denied, but what this exodus meant and what the speed and size of the migrations to the cities foretold was something many tried to ignore or deny. ([Location 3289](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3289)) - Tags: [[blue]] - Note: Recognizing mega trends early can be huge. Here Zeckendorf outlines how understanding migration flows and the forces driving them can help you see into the future of a city - Title I was a good idea, but it did not work. The trouble was that the law concentrated only on housing. It takes much more than the razing of slums and putting up of clean new apartments to revitalize a great area stricken with a combination of social and economic ills: revitalizing parts of a city's core calls for a change in its human chemistry. The best way to achieve this is through new or better land use (as happened in Montreal). Housing can, and in most instances should be, a key part of this change, but you also have to create supporting commercial and aesthetic elements in the area or have them already available nearby, otherwise your housing will eventually succumb to the decay around it. The 1949 law took none of this into account. ([Location 3298](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3298)) - Tags: [[blue]] - Note: Understand the complexity and interdependencies in your particular situation. Here cities wanted a simple solution (ie housing) but didn’t take into account how housing, aesthetics, and commerce interact to produce a neighborhood. Moreover, they didn’t take into the account that more quality housing with commerce and aesthetics has a POSITIVE effect on the neighborhood, whereas more housing without sufficient quantities of those other variables actually causes more BLIGHT - In response to the poor showing of Title I and the suggestions of a special commission appointed by President Eisenhower, Congress in 1954 passed further legislation enabling the FHA to insure urban developments by using formulas based on the value of property once a project was successfully completed. In other words, the FHA insurers were called upon to begin thinking and acting as propagators of seed money and not as money guardians. ([Location 3307](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3307)) - Tags: [[blue]] - Note: A case of aligning incentives. Once the FHA was incentivized to insure projects with high dollar values, urban redevelopment became more attractive for them - The vagueness about plan details kept would-be lessees from committing themselves to plaza offices. This in turn kept mortgagors from committing themselves to finance the site—which kept Webb & Knapp from moving forward on the construction. ([Location 3589](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3589)) - Tags: [[blue]] - Note: Uncertainty leads to all kinds of problems. You have to be decisive and maintain definitive plans - Webb & Knapp, its energies diverted by crises in a dozen different areas, was in poor shape to move against a politically entrenched opposition. ([Location 3633](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3633)) - Tags: [[blue]] - Note: Dividing your attention across projects, while limiting risk associated with any single project failing, increases the probability that they actually DO - During this same period Webb & Knapp had learned how to create projects that mesh with the surrounding city. In our UN deal, at 1407 Broadway, at 112 West Thirty-fourth Street, in Denver, and in Montreal we had foreseen what would happen when, upon completion of our projects, key parts of a city would act upon each other in new ways. ([Location 3697](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3697)) - Tags: [[blue]] - Note: They learned about complexity - how changing certain parts affects other interdependent parts - All this work, plus the ultimate gilding of the lily with the model, might take six months to a year; it might cost $60,000 or $250,000 or more, but it was utterly necessary. And the model, in phase three of the process, became our most potent selling tool. ([Location 3741](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3741)) - Tags: [[blue]] - Note: You need to SHOW customers so that they get it. A demo that they can get their hands on is the best way to demonstrate what is great about your product. Lower the barrier for people to try - City planners often concentrate projects in the very worst part of a city core but do not touch adjacent areas that are still more or less viable. In other words, they conceive of their projects as planners' ghettos or oases, with no real connection to the economic forces in a city. This is a grievous and substantial error. If it is to serve, a development must add to the existing or potential flow of business and people through an area. If this means expropriating and acquiring some nondeteriorated properties as a form of bridge between areas, so much the better for the best long-term results. ([Location 3753](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3753)) - Tags: [[blue]] - Note: Again he’s referring to complexity. You need to understand the flows in a system and how best to operate within those flows. Acting as if a complex system, such as city, can have isolated parts is a recipe for disaster - Webb & Knapp, I should note, did have a way of somehow or other seeing through those projects it started, and every one of our projects wound up making money for its eventual owners. ([Location 3817](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3817)) - Tags: [[blue]] - Note: ALL the redevelopment projects ended up in losses due to struggles with local political and/or business interests. The moral of the story - DO NOT COMPETE IN A HIGHLY POLITICAL ARENA. Especially not when your costs are incredibly high, as in development. The bureaucracy will grind you to dust - I was a guest at a Columbia University dinner honoring Le Corbusier. In due time Corbusier rose to make some remarks and at some stage paused and asked, "Is Bill Zeckendorf here tonight?" I put up a hand, "I'm here, Corbu." Stretching out a long arm to point a finger at me, Corbusier said, "There is the man who has done more than anybody else for architecture in America." ([Location 3874](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=3874)) - Tags: [[blue]] - We were in business for profit, so why did we do this? We did it because it had to be done, and nobody else could do it. ([Location 4448](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=4448)) - Tags: [[blue]] - Note: Very Napoleon-esque. A strong sense of purpose - The job is to select among the possible choices and get to work. ([Location 4853](https://readwise.io/to_kindle?action=open&asin=B00LP077AU&location=4853)) - Tags: [[blue]]