Dealmaker in Chief

[Don Konipol]

This should probably be in the category of real estate HISTORY, but since we don’t have that category…..

I’m reading a book that has me intrigued, “DealMaker in Chief.  The premise of the book is that the first real estate “investor” in our country was - ready for this? - GEORGE WASHINGTON.  And that his understanding of business and economics enabled him to lead our country to establish the free market based system we benefit from today. 

Most people know that George Washington began his business career as a surveyor; in fact he was selected as county surveyor at the age of 17.  What’s little know is that Washington recognized in the land he surveyed that certain parts of that land had potential for development, while the majority of the estates had less or even little potential.  Washington offered to trade his surveying fees for those parcels he considered ripe for development, and utilized any money he earned to do the same.  So, for example Washington might survey a 1 million acre estate, offer to purchase 550 premium acres (or accept such as payment for his services) and “bank” those 550 acres for future development. 

Now, as background information, up until Washington’s land purchases, almost all land was obtained either through land granted by the crown to a Lord, or through inheritance being the first born son. The few sales that took place were for full estates, not parcels.  Washington was the first recorded deeds of smaller parcel transfers; additionally he also surveyed those parcels himself. 

George Washington acquired a significant amount of land this way, and shortly after acquiring such created SYNDICATIONS (he later used JOINT STOCK COMPANIES when they came into existence) to raise the capital needed for development.  Washington was the operating partner, with the land being developed for small farms, houses, grain silos, tanneries, barrel manufacturing facilities, churches, stores, etc. 

Washington continued with land acquisition and development through most of his life, with two exceptions, both of eight year duration.  The first being when he was General in charge of the Continental Army during the Revolution; the second being the eight years of his two Presidential terms. 

Washington inherited two large estates; the first was the estate he got possession of when marrying Martha; however, unlike most husbands of that era he didn’t “consume” the ownership of Martha’s estate into his own; he operated it in a “trust” capacity for the benefit of Martha and her daughter by a previous marriage.  Further, while bringing the estate from the brink of bankruptcy to profitability, he invested all cash flow into improving the estate and diverted no funds to increasing his personal wealth.   The second estate he inherited was from his half brother; he once again operated their estate in a way to keep it whole and did not do land development; instead he started numerous business endeavors to keep the estate profitable. 

As near as historians can figure, Washington’s net worth at the time of his death in current dollars was over $1 billion.  He engaged in about 70 land development and business partnerships in which he was the operating partner.  So, not only was George Washington our greatest military leader and greatest President, he was also our greatest REAL ESTATE INVESTOR.!