$700K for the World’s Largest Building
$700K for the World’s Largest Building
How JFK's Dad Acquired the Chicago Merchandise Mart
In 1945, amidst skyrocketing WW2 era taxes of over 90% in certain cases, Joseph P. Kennedy seized a golden opportunity: the struggling Chicago Merchandise Mart, a colossal 4.2 million sq. ft. structure erected in 1930 at a $30 million cost.
Kennedy amassed immense wealth through savvy investments in the booming 1920s movie industry. His perfect timing of the ‘29 crash amplified his fortune.
With nine children and a passion for public service, Kennedy aimed to shield his family from financial worries. He even insisted that money was off-limits at their dinner table.
The Mart's owner, Marshall Fields, weighed down by obligations, contemplated a loss-inducing sale to ease wartime tax burdens. Enter Kennedy, one of America's wealthiest, renowned for his personal liquidity.
Seizing the moment, Kennedy offered $13.2 million, backed by a $12.5 million mortgage, needing only $700K from his own pocket. The deal nearly fell apart because the seller heard taxes might decrease, making a sale unnecessary. Yet, Kennedy's Senate friends assured them this wouldn't happen soon enough.
Leveraging a close relationship with the IRS, Kennedy shifted Mart ownership to his family trust, ensuring a lasting legacy. He was meticulous about taxes, even sharing his returns with the IRS before filing to make sure he followed the rules and didn't pay extra.
Kennedy's bold management style revitalized the Mart. He bolstered rent from $3.5 million to $13 million by 1955, even convincing tenants to finance a $5 million air conditioning installation.
The Kennedy family's ownership spanned decades, ultimately selling the Mart in 1998 for $625 million. Although Joe Kennedy passed away in 1969, his family’s ideas, backed by his financial acumen, continue to resonate.
Today, the Chicago Merchandise Mart thrives as a cornerstone of the city's business landscape under the ownership of Vornado Realty Trust. A testament to Joe Kennedy's shrewdness and enduring influence.