By Bill Coffin, Class of 2004
Tour Director, Art Deco Skyscrapers: Downtown and Art Deco Skyscrapers: Riverfront
How did a largely forgotten safe deposit company come to own the Chicago Board of Trade Building in 1930?
Organized in 1848, the Chicago Board of Trade obtained its corporate charter by a special act of the Illinois legislature in 1859. The charter authorized the Board “to maintain a commercial exchange; to promote uniformity in the customs and usages of merchants; [and] to inculcate principles of justice and equity in trade.” It also prohibited the Board from owning property worth more than $200,000.
The charter’s $200,000 limit presented a problem when the Board was looking to build new headquarters, but ways were found to circumvent it. In 1881, having acquired the lot at LaSalle and Jackson, the Board could not own the $800,000 building envisioned there. Thus, five Board members, serving as trustees, raised the money to build, and to own, the first Board of Trade Building in 1885.
In 1928, having outgrown the first building, the Board created an out-of-state corporation to build the second Board of Trade Building. Illinois law disfavored corporate accumulation of real property, but an out-of-state corporation would not be limited by an Illinois charter. And although a state statute allowed corporations to own only the property necessary to transact their business, courts interpreted the statute to include property that might become necessary due to future growth. Until that future growth occurred, the not-yet-necessary property could be leased.
That broad interpretation, allowing for future growth, allowed a small Delaware corporation – the brand-new Chicago Board of Trade Safe Deposit Company — to build a 45-story skyscraper in Chicago. The new company was owned by five members of the Board of Trade. It obtained title to the Board’s $10.5 million lot at LaSalle and Jackson and issued bonds to pay for the new $12 million building.
When the building was completed in 1930, the safe deposit company moved in and began its business. It advertised in the Daily Tribune. It rented safe deposit boxes in the basement vault. And it had noteworthy clients; in the 1950s, when jewelry encrusted with diamonds, emeralds and rubies, and letters written by Theodore Roosevelt, were found in boxes rented by the widow of a former Chicago mayor, the press published the particulars.
Although the company was the real deal, it would have been farcical to forecast a future when it would grow to fill the full 45-story skyscraper, as the law contemplated. Nonetheless, the lawfulness of such a small company acquiring such a big building, and then leasing most of it, was never challenged. So, as planned, the building became the home of the Chicago Board of Trade, and it was named the Chicago Board of Trade Building. But the art deco skyscraper at the end of LaSalle Street was owned by, and owed its existence to, the Chicago Board of Trade Safe Deposit Company.
Sources:
Fifty-sixth Annual Report of the Trade and Commerce of Chicago, Hedstrom-Barry Co., 1914, Appendix p. 5.
https://babel.hathitrust.org/cgi/pt?id=njp.32101068317104;view=1up;seq=6
Rector v. Hartford Deposit Company, 190 Ill. 380 (1901).
https://books.google.com/books?id=o9kDAAAAYAAJ&pg=PA380&lpg=PA380&dq=Rector+v.+Hartford+illinois+1901&source=bl&ots=6z4_Mi7mKH&sig=gPgwTTb61Of2S_hh-Zt7xt_hTQA&hl=en&sa=X&ved=0ahUKEwjMqY20xfXTAhVoylQKHWViBl8Q6AEIKDAB#v=onepage&q=Rector%20v.%20Hartford%20illinois%201901&f=false
Chicago Daily Tribune, Dec. 4, 1928 and May 19, 1955, Chicago Historical Archive.
http://search.proquest.com.gatekeeper.chipublib.org/hnpchicagotribune/index?accountid=303