Charles J. Urstadt '53: Swimming Upstream
Talking with Charles Urstadt '53, you get a history of real estate in New York City from the 1930s to today.
"I grew up in a real estate family," he says. "My grandfather owned it, my father managed it, and I'd help them collect rents." Later, Urstadt was to serve as the New York State commissioner of housing and community renewal under the Rockefeller administration, and go on to chair Urstadt Biddle Properties, one of the few real estate investment trusts (REITs) to survive and thrive during the recent financial crisis.
Why did this ultimate real estate man get a law degree at Cornell?
After graduating from the Bronx High School of Science at age sixteen, he went to Dartmouth, and then to their Tuck School of Business. The Korean War had just begun, and the young Urstadt signed up for a commission in the navy. While waiting for them to call him up, he decided to go to law school. "Law is a skill intrinsic in real estate," he says. "You can't buy property unless you know what you're doing in contracts."
He chose Cornell because he wanted a New York law school, and Cornell was the best.
Also, he notes, "I like schools outside of cities. I don't feel you have school spirit in a city school. And the affinity people have for each other is much greater. I stay connected with a lot of Cornell people," Urstadt says. "I'm glad I went there."
And then he began his career as a lawyer.
But in 1953, "There was no such thing as a real estate law firm," Urstadt recalls. So he joined Nevius Brett & Kellogg, because they represented big contracting companies who built real estate. A year later, the navy called him. He served on the U.S.S. Bennington, an aircraft carrier, for two years-and met his wife, Elinor, a Smith graduate, while stationed near her native Santa Monica.
On returning to New York, Urstadt soon found a position in the law department of William Zeckendorf's real estate firm. "He was the Donald Trump of his time," quips Urstadt. "And he was king of leverage." As part of that job, Urstadt worked with Alcoa Residences, who later asked him to join them full time. However, he says, "People would be shipped around the world; they would eventually work in Pittsburgh. That wasn't my kind of real estate business."
Fortunately, a Cornell connection, Robert R. Douglass '59, introduced Urstadt to Nelson A. Rockefeller, who was running for governor of New York State. Rockefeller told Urstadt, "I want to do something about urban renewal in New York State. I want to do something about rent control, and I want to fill in the Hudson River."
Urstadt did all of those things.
He created the Urban Development Corporation (which is now the Empire State Development Corporation). His idea was to have a state authority initially own and fund the project, then have private developers purchase it and build it.
Rockefeller's idea was to create housing and offices on ninety acres of landfill in the Hudson River in lower Manhattan, twenty acres of which had come from the excavation from the World Trade Center. Urstadt was the founding chairman of the Battery Park City Authority. He served for its first twelve years during which extensive political, legal, financing, and engineering challenges were solved.
As the commissioner of housing and community renewal from 1967 through 1973, Urstadt also tried to solve the problem of rent control with vacancy decontrol. "We had 72,000 apartments held by the city as a result of foreclosures," he says. "Rent control discouraged both renovation and new construction." The Urstadt Law made some people happy and others furious-but it is still on the books.
In fact, Urstadt says, "I was recently honored at a dinner at the University Club, and there were all kinds of tenant groups picketing the Urstadt Law. "A woman came in demanding 'Where's Urstadt?' And my son-in-law pointed to the other side of the room!"
Urstadt's government service expired at the end of 1978, and he used his experience and connections to return to the real estate business in partnership with his son, Charles D. Urstadt.
"We decided to keep our property local, run it ourselves with no outside managers, and keep our mortgages low," Urstadt says. "These are our real estate rules."
In 1995, his son-in-law Willing L. Biddle joined the company, now known as Urstadt Biddle Properties, an REIT listed on the New York Stock Exchange (UBA). Young Charles is now a director, and its core investments consist of shopping centers concentrated in New York City suburbs.
"My grandfather had a great expression: don't buy anything you can't walk to. I've gotten a little more modern than that," Urstadt jokes. But it's still a family business. Although he notes that third-generation companies make up only a tiny percent of family businesses, that's a plus: "We buy properties from third-generation families who are fighting with each other!"
And because the company kept their debt low and their property base focused, "We just celebrated paying a dividend every quarter for forty years and raising it each year for the last sixteen years," Urstadt says proudly.
Not one to rest on his many laurels, Urstadt returned to competitive swimming in 1999. He had raced as a boy in the Bronx and was an All-American at Dartmouth. He also helped Scotty Little to coach swimming at Cornell. He still holds the world championship record for the fifty-meter breaststroke in his age bracket, plus many U.S. Masters championships and records.
Urstadt talked by phone from his Connecticut office on his eighty-second birthday. He can't resist making one more joke, which he attributes to George Burns. "At my age, when I order a three-minute egg, they make me pay in advance."
Actually, in the next year or so he'll probably start a few more companies and win a few more swimming medals.