Real Estate Developer Profiles
Junior Rockefeller - Rockefeller Center
conceived as Metropolitan Square, a complex anchored by the Metropolitan Opera,
Rockefeller Center was at the time the greatest real estate development and construction
project in the city, and was tremendously important to the commercial contractors
and construction companies in the city - due to the Depression it was one of the
only major projects underway, and was responsible for employing more construction
workers than any other project of its era. Its significance in the history of
American real estate development is due to being one of the first "destination"
developments - instead of simply drawing from nearby attractions or facilities,
Rockefeller Center was intended to be the destination, setting the stage for a
number of other "destination" projects that would follow in the latter
part of the 1900s. Today's planned multi-purpose developments that include office
space, retail and shopping areas, housing, and parks and recreation are direct
descendants of Rockefeller Center.
The Metropolitan Opera was intended to
be the anchor in the development, drawing visitors and prestige to the complex.
After negotiations fell through and fund-raising dried up, the Metropolitan Opera
backed out of its commitment, leaving Junior Rockefeller to develop the project
on his own. Rockefeller had signed a commitment conveying him rights to develop
the property at a cost of $3.3 million per year for twenty-four years. The stake
of his personal investment alone caused him to move ahead with the project. He
later stated that it had never been his goal to become a real estate developer,
but he embraced the role whole-heartedly, with spectacular results.
managing agent, John Todd, was delighted the project went ahead: his contract
giving him a share in the rents encouraged him to construct the square to become
the world's finest shopping and office district. Unlike many designs for buildings
in that era, Todd ensured that architects maximized usable space in each building,
thus maximizing rent income and user convenience and affordability. The construction
plans called for a central tower surrounded by a plaza and lower towers and corner
office buildings. RCA, recently spun off from General Electric, was slated to
be the major tenant of the central building.
Rockefeller eventually spent
and committed almost $100 million on the project. He received a construction loan
from the Metropolitan Life Insurance Company, who had become a regular financer
of construction projects for real estate developers throughout the city. In order
to receive the loan, he was required to pledge personal assets as collateral.
(At the time, few shared his vision of a "destination" development -
many experts of the day felt the project would fail.) Because of its cost, practicality
was the order of the day for the architects and contractors. Plans were constantly
modified to take advantage of construction efficiencies and to maximize rentable
space, keeping costs low both for the developer and for potential tenants.
battle to acquire land for the whole complex also presented challenges for the
developers. When property owners at the corners of 49th and 50th streets set their
sale prices too high, the tower was simply designed and built around them. "Roxy"
Rothafel, a burlesque theater and show designer, built the Radio City Music Hall
to take advantage of the proximity to the Center. As the development took shape,
many other local businessmen scrambled to position themselves to take advantage
of the magnet the Center would become.
Seventy-five thousand union construction
workers made the site into a center of activity so attractive to passersby there
was an official sidewalk-superintendents club, complete with membership cards.
Six buildings and two theaters were almost complete when large companies started
signing agreements to move their headquarters to the square, and more became interested
when it became clear that Rockefeller Center would be the most important new mid-town
When the seventy-story RCA Building was completed in 1933
(as the major tenant they had naming rights), Junior moved the family offices
to the fifty-sixty floor of the skyscraper. (The RCA Building is now commonly
known as 30 Rockefeller Center, or "30 Rock" for short.) Nelson, still
in his twenties, earned a real-estate license and soon became a salesman for empty
office space at Rockefeller Center. Several companies in the Rockefeller organization,
like Standard Oil of New Jersey, Socony-Vacuum, Standard Oil of California, and
Chase National Bank, took space. In 1938, the first year it turned a profit, Nelson
was named president of Rockefeller Center. By the time Junior hammered in the
last of over ten million rivets in 1939, he had transformed the project from the
butt of malicious jokes into what would become an outstanding triumph of Depression-era
real estate development and construction.
In 1948, Rockefeller Center was
bought by Junior's five sons for $442,000 each, plus their agreement to take on
a debt of $10.6 million each, payable to Junior's estate only at the time of any
future sale to non-family members. The influx of new capital allowed Rockefeller
Center to expand, paving the way for construction of towers for Esso (now Exxon)
and other former tenants who now wanted buildings of their own. As the postwar
boom hit full stride, the value of Rockefeller Center increased astronomically,
becoming the single most-important source of income for the Rockefeller family.
In fact, their fortune was no longer derived from oil - it came mostly from Manhattan
real estate. Very few families (or companies) successfully shift their core business
from one industry to another, especially a company as large as Standard Oil, then
the largest oil company in the world. Real estate development, and the vision
to pursue worthwhile projects in the face of public skepticism, allowed the Rockefellers
to affect an amazing transformation in their business. Rockefeller Center stands
as a monument both to John D. Rockefeller, Sr. and to the family's willingness
to pursue a real estate development project many thought would fail.
enough, John D. Rockefeller, Sr., patriarch of the family and the business operations,
remained curiously indifferent to the complex that has perpetuated his name. Even
though Rockefeller Center's nineteen buildings now cover 11 acres in mid-town
Manhattan, he reportedly never set foot in any of the Rockefeller Center buildings,
even though the complex was named in his honor.