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• 1 2017-12-15T21:17:10-08:00 State of the F. W. Woolworth Company: An Analysis of the Different Positions of the F. W. Woolworth Company, Seagram Company, and AT&T Surrounding the Development of Their Signature Skyscrapers 6 An Analysis of the Different Positions of the F. W. Woolworth Company, Seagram Company, and the American Telephone and Telegraph Company Surrounding the Development of Their Signature Skyscrapers plain 2017-12-27T17:18:03-08:00

  F. W. Woolworth Company

  Before having commissioned and moved into the Woolworth Building, F. W. Woolworth had offices for his company in a building directly facing the plot that would eventually become his namesake company’s signature office building. (1) This meant that he had a thorough understanding of the area and the other businesses that were tenants in neighboring buildings, which he could eventually use to his advantage as he tried to lure them into what was then the tallest building in the world. (2) Furthermore, the continued push towards urbanization and rising land prices and rents meant that some businesses were beginning to think of making an investment and developing their own bespoke skyscraper project. (3) Cass Gilbert, architect of the renowned Woolworth Building in New York, once said that a skyscraper was “a machine that makes the land pay.” (4) In 1910, the Woolworth Company ended up commissioning Gilbert to design the Woolworth Building, meant to be the new headquarters for the company and a symbol of their success. (5) Woolworth commissioned this structure following the incorporation of his company, the opening of its first international store location, and the beginning of merger talks (which ended up being completed with four major competitors in 1911). (6) By commissioning their own sixty story building, of which they only used around two stories for themselves, Woolworth suddenly became a major player in the New York real estate market. All of the speculative space in the building was meant to capitalize on the Woolworth Company’s partners and neighboring businesses wanting to be in such a signature building and become an additional revenue stream for the company. (7)

  Seagram Company

  Contrary to the common school of thought regarding the construction of skyscrapers, the Seagram Building was not commissioned during a great time for the company. Seagram had become one of Canada’s largest distillers prior to moving their headquarters from Montreal to New York City, where they first occupied space in the Chrysler Building, in 1934. (8) The Seagram Company that ended up commissioning the famous building that shares its name actually came about when Samuel Bronfman, owner of family business Distiller’s Corporation Limited, purchased the Seagram distillery that was floundering during Prohibition in 1928. (9) As a result of the concerns about the Seagram Company’s involvement with illegal alcohol production and distribution during the Prohibition era, the company’s reputation, along with Bronfman’s own, was getting dragged through the mud. Understanding that his company was occupying the headlines far too often for negative reasons and criminal activity speculation, Bronfman set about taking control of the narrative in the press. Contrary to the common perception that the typical company would commission the development of a signature building project during a time of economic success and strong public relations, Bronfman clearly did not follow that model. (10)
  
  In order to take back the narrative and manipulate the press surrounding his company in a more positive light, Bronfman commissioned the Seagram Building in 1954. (11) In the past, companies like the F. W. Woolworth Company commissioned their signature namesake building as they were expanding internationally and merging with competitors domestically to expand their reach. (12) Yet, the Seagram Building was meant to make a statement in the same way that the Woolworth Building was. Both buildings served two main purposes: displaying the power of the corporation and serving as a real estate investment in a hot market. (13) Every new skyscraper construction was a speculative activity to a certain extent. The company commissioning the building very rarely, if ever, used up all of the space in the building. For example, the Woolworth Company only used around two stories out of their sixty story tower and the Seagram Company used under 200,000 square feet of the roughly half million square feet Seagram Building. (14) (15)

  American Telephone and Telegraph Company (AT&T)

  In its heyday, AT&T had expanded to be one of, if not the, largest and most powerful corporations in the world. (16) Due to some relatively manipulative business practices in dealing with distributors on a more local level, AT&T had drawn the ire of MCI Communications. Following a skirmish that ended up with Illinois Bell, a subsidiary of AT&T, shutting off access to telecommunications services for MCI Communications in the area. As a result of what they viewed as an unfair competitive advantage stemming from monopolistic practices, MCI Communications began gathering evidence to justify their view of the situation. Having been based out of Washington, D.C. in close proximity to the lawmakers, MCI Communications had a fair bit of sway, and ended up submitting evidence to the Department of Justice that supported the claim that AT&T was in violation of anti-trust laws. In 1974, the Federal Communications Commission formally entertained an antitrust lawsuit against AT&T on suspicions that it was using profits from its technology division to subsidize the costs of its telephone service and leveraging its government-supported monopoly on the telecommunications industry to stifle competition and put its distributors out of business. After a long process, MCI Communications was awarded $1.8 billion to compensate for the monopolistic actions taken by AT&T. Additionally, AT&T agreed to a breakup of the Bell System that had caused the antitrust suit with MCI Communications in 1982. As a result of having divested from the localized Bell Systems, AT&T suddenly was a much weaker and smaller company, no longer needing all of the space being created with the AT&T Building.  

  With construction having started on the AT&T Building in 1980, the design and planning indefinitely were done a few years in advance. However, the antitrust lawsuit brought up against AT&T was filed in 1974, meaning that the company definitely had time to process what was being brought up against them before continuing on with the skyscraper. At a time when the company knew that the possibility existed that the Department of Justice would order that the company splits up to fall in line with monopoly regulations, they continued on with constructing a signature building. Prior to the lawsuit having been brought against them, AT&T had been doing well financially, as their government-sanctioned monopoly meant that they could focus on innovating their products and improving performance for their customers without the fear of competition coming in and undercutting their prices. Nevertheless, by the time the skyscraper was being built, they had been ordered to pay out $1.8 billion to one of their competitors and they had been dealing with the Department of Justice for over six years. Applying the ideology of the prevailing school of thought in skyscraper economics, the conclusion would be made that AT&T was likely faring pretty well in the early 1980s. Yet, this could not have been further from the truth. When considering the full context, it becomes apparent that AT&T commissioned their signature building to make a statement. As a way of showing to the world that the company did not fear the antitrust suit and was still one of the world’s most dominant corporations, AT&T continued on with the construction of this building publicly displaying their might. Similar to the Seagram Building, the AT&T Building in New York is a key counterexample to the notion that skyscrapers are built during times of prosperity and success. 

  By: Daniel Freedland

  Sources

  1. Gail Fenske and Deryck Holdsworth, “Corporate Identity and the New York Office Building: 1895-1915,” In The Landscape of Modernity: Essays on New York City, 1900-1940, ed. David Ward and Olivier Zunz (New York: Russell Sage Foundation, 1992), 145.
  2. Fenske and Holdsworth, “Corporate Identity,” 146-147.
  3. Carol Willis, Form Follows Finance: Skyscrapers and Skylines in New York and Chicago (New York: Princeton Architectural Press, 1995), 146.
  4. Willis, Form Follows Finance, 19.
  5. Gail Fenske, “Medievalism, Mysticism, and Modernity in Early-Twentieth Century New York,” In Skyscraper Gothic, ed. Kevin D. Murphy and Lisa Reilly (Charlottesville: University of Virginia Press, 2017), 55.
  6. Fenske and Holdsworth, “Corporate Identity,” 145.
  7. Willis, Form Follows Finance, 146-147.
  8. Phyllis Lambert, Building Seagram (New Haven: Yale University Press, 2013), 4.
  9. Jack S. Blocker, David M. Fahey, and Ian R. Tyrrell, Alcohol and Temperance in Modern History (ABC-CLIO, 2003), 554.
  10. Fenske and Holdsworth, “Corporate Identity,” 129-130.
  11. Lambert, Building Seagram, 6.
  12. Fenske and Holdsworth, “Corporate Identity,” 145-146.
  13. Willis, Form Follows Finance, 146.
  14. Fenske and Holdsworth, “Corporate Identity,” 145.
  15. Lambert, Building Seagram, 38.
  16. Steve Coll, The Deal of the Century: The Breakup of AT&T (New York: Atheneum, 1986).