From Winnipeg to Pasadena

I have long thought of Winnipeg as a city with a bigger past than a future, a sentiment with which that peculiar, but intriguing, movie My Winnipeg seems to be aligned. Historically, real estate busts parallel stock market collapses, but with a separation of a few years. So, the 1836 Chicago real estate dive was followed by a generalized huge stock market drop in 1837 as the USA slid into the deepest depression in its history, with unemployment rising to about 50% by 1840. The 1926 Florida real estate bust was followed by the infamous 1929 Wall Street crash. Likewise the Winnipeg real estate market entirely deflated in 1882, two years before the 1884 stock market panic, and in terms of inflation adjusted dollars, Winnipeg’s real estate has yet to recover those losses. Yes, it is not true that if you patiently hold onto real estate long enough, the price will always recover, unless 135 years is not enough patience.

The steel magnate, Andrew Carnegie, whose company morphed into U.S. Steel, built sandstone library buildings around North America. We have one of them here in Victoria, downtown on Blanshard Street, except very few people know that it used to be a library. I’ve seen them elsewhere too. I’m rambling here. Later, one of the largest --- perhaps the largest --- stockholder in U.S. Steel, and a director, was Hulett C. Merritt. He is reputed to have said that any man that knows how much he’s worth mustn’t be worth very much. Around 1900, Orange Grove Boulevard in Pasadena had become the home to several mansions of wealthy and influential families. They generally still stand. There is the Wrigley mansion, later to become the headquarters of the Rose Bowl Parade. There was the Busch mansion (think Anheuser-Busch). These, and other, great estates fronted onto the aristocratic Orange Grove Blvd.

Then came the upstarts. Cyrus McCormick built a mansion on Orange Grove, but he structured his property to back onto that elegant street, and his frontage was Terrace Drive. If I recall correctly, the mansion south of him, which I knew as Manor del Mar, was owned by his father, but I might be wrong. To McCormick’s north was built a large Tudor mansion that came to be called Mayfair. Next in line, north of Mayfair, was the Italian styled Terrace Villa, owned by Lewis J. Merritt, father of the aforementioned Hulett Merritt. A bit further on was the smaller Olcott mansion, and smack in between these two estates lay what I think was about 3 acres of ground sloping from Orange Grove down to Terrace. This property was purchased by Hulett Merritt, and from 1905 to 1908 he constructed a 17,000+ square foot trophy home, the biggest one in that row of mansions that now backed onto Orange Grove Boulevard like it was their back alley, and which stretched from Del Mar Blvd. to Green Street. Merritt paid 1.1 million dollars to build that home in which he lived for 45 years. Its dining room had the first recessed lighting in America, and in the rear of the home was a beautiful Italian Garden. The two Merritt mansions were also connected by a secret underground tunnel as I recall. Many regularly saw the Hulett C. Merritt mansion in the TV show The Millionaire.

Now, here’s the point. The Merritt estate sold the huge mansion in 1956, obtaining $20,000 for it --- less than the original cost of the front wrought iron fence. Ambassador College bought it and renamed it Ambassador Hall, converting it into a classroom building. Later, when the college closed, the property passed into other hands, and I see that it was once again sold this month for 2.1 million dollars. I don’t know what the 1.1 million cost of 1905-1908 is in today’s dollars, but I think something like $30,000,000.  Winnipeg is not the only place where it would not have paid to hold real estate for 135 years.