thirty-odd who voted for the parkway site, and about sixty-odd who voted against it. And I have been told, although I make this representation only on what has come to me, that there is a petition signed by about 750 members of the bar in favor of the parkway site. When the smoke clears away you will have decided this question irrespective of the conflict of voices, and when you do I think the considerations I have outlined you will find are the ones that have to be considered.

The CHAIRMAN. The committee will now be glad to hear from Mr. Francis B. Bracken, of Philadelphia.

STATEMENT OF FRANCIS B. BRACKEN, ATTORNEY AT LAW, PHILADELPHIA, PA.

Mr. BRACKEN. Mr. Chairman and gentlemen of the committee, I represent the Fidelity-Philadelphia Trust Co., trustee, owner of one of the sites considered most available for the erection of the new courthouse if it should be decided that the building should be erected on the parkway.

The CHAIRMAN. And I understand you are in favor of the erection of the building on the parkway, is that correct?

Mr. BRACKEN. That would go without saying, sir. I have come here, however, not particularly to advocate the parkway site, but it seemed desirable the trust company's position in the matter should be understood by the committee as one of the things which might have a bearing upon the general conclusion that might be reached.

Now, the trust company in 1926 became the owner as trustee of a mortgage securing a bond issue of $925,000 covering the major portion of one of the sites suggested as available for this new court building. It became the owner recently of that part of the site through foreclosure under the mortgage. It has no interest of its own as a corporation in any parkway site, all the interest in the mortgage being held by the trust company as trustee for the various cestui que trusts. So therefore its interest in selling the property to anybody, and in selling it now if it should be taken for the purpose of this court building, is purely the interest of the trustee. That I emphasize because suggestions made at other meetings have been to the effect that a company is trying to unload its loss in this investment on the Government.

At the time when the mortgage was created the property covered by it was appraised as being worth $1,400,000. About the time the Treasury Department undertook an investigation of this whole question, having examined the several available sites on the parkway, the trust company was requested to submit a figure at which this property, and the other adjacent properties necessary to provide space for the proposed building, could be secured. The trust company submitted a figure made up of exactly the amount of the investment for its cestui que trusts in the mortgage. In other words, it hoped to realize from that part of the property covered by the mortgage, sufficient to make a sale at the amount of the investment made for its beneficiaries. It added to that estimate of value for the adjacent properties which are owned by others, some of them being covered by small 3-storied houses, and having reached a conclusion

as to the proper price and the outside price which should be paid for those properties, the trust company submitted its proposal or suggestion to the Treasury Department.

Therefore, I want to make it clear to the committee that if this site, or any site on the parkway is selected, there is no disposition on the part of the trust company to charge the Government an extravagant price for any land it may acquire. That, on the contrary, it is naturally desired for the benefit of its cestui que trusts to convert this property into cash and reinvest it, and therefore is in the position to offer the Government at this time one of the most available sites on the parkway at a price which, when conditions improve, will be regarded as utterly ridiculous.

The CHAIRMAN. Could you give us the assessed value of that property?

Mr. BRACKEN. The assessed value of the particular property owned by the trust company as trustee, the first triangular piece shown there on that map, would be $550,000, and the other piece, marked "B" on the map that I have here before me, across Cherry Street, and which is included in the ground proposed to be taken for this building if this site should be selected, is priced at $75,000. The CHAIRMAN. How much is that?

Mr. BRACKEN. It is $550,000 and $75,000. That would be $625,000 altogether. So far as values of properties in this neighborhood are concerned, and really as regards present values of real estate anywhere, it is very difficult to find a basis upon which to form a judgment, because no real estate in any of the large cities, such as large tracts like this, is at all salable. That is the present condition of the real-estate market; there is no market as a basis upon which you can fix values.

Senator DICKINSON. Is there a building located on this trusteed property?

Mr. BRACKEN. There is a 2-story hospital clinic building.
Senator DICKINSON. But no rental return?

Mr. BRACKEN. None now. The property was originally owned, or I will say was owned until some years ago, by the University of Pennsylvania. It had been the site of the Medical and Chirurgical Hospital in years gone by, and later was taken over by the University of Pennsylvania, and later abandoned by the university as a hospital site and sold to other owners. It now comes into the hands of my client as trustee as a result of the foreclosure of the first mortgage.

If it would be of any service to the committee I should be glad to leave with you the map, which indicates the site, which is close to the center of the city, on the parkway, the most available in the judgment, I think, of nearly all who have considered the question for the erection of a Federal court building. The parkway is here [pointing on map] as you will observe, and this is the triangular piece of property, included in the property owned by the FidelityPhiladelphia Trust Co., and would be the principal frontage of the new site if selected for the courthouse.

The CHAIRMAN. Does the site embrace all that is shown on this map?

Mr. BRACKEN. It embraces all included in these red lines.

Senator DICKINSON. What is the estimated value of your proposal, including your site and the other properties necessary to 'build this courthouse, what is the total amount?

Mr. BRACKEN. Approximately $1,500,000.

Senator DICKINSON. Now, is that proposal definite or is a condemnation proceeding necessary in order to get a part of it?

Mr. BRACKEN. As to the Fidelity-Philadelphia Trust Co. property, which is valued at about $1,100,000 for the purpose of that estimate, that of course is a definite commitment that has been made by the trust company. With regard to the other properties, there are no definite commitments and the values of them are estimated amounts, the outside amounts which it is believed they can be readily acquired for, for the purpose of this Federal court building, and certain amounts which would be in excess of any allowance made if there were a condemnation proceeding.

Senator DICKINSON. The thing I had in mind is this: That this is an emergency relief construction act of 1932. If you are going to be tied up in the courts up there with condemnation proceedings for a part of this real estate you would be probably delayed at least a year before you could get any emergency relief up there.

Mr. BRACKEN. I think it safe to say that that emergency will not arise. None of these properties is producing a present-day income. All these holders, and one of them is another trust company which I think acquired its property in the same way that the Fidelity-Philadelphia Trust Co. acquired the large piece, through foreclosure of a mortgage, and I am quite certain that all of them will be quite willing to sell their properties at a very reasonable valuation.

Senator DICKINSON. Have their proposals been placed in the hands of a Government agency? I mean an agency that is authorized to purchase such properties?

Mr. BRACKEN. This proposal I speak of is the only one I know of. and that is the proposal made by the Fidelity-Philadelphia Trust Co. affecting its own property, but undertaking to secure the other properties at values not in excess of the values named in the proposal. Senator DICKINSON. In an emergency proposition, of course, time is the essence of the matter. The question I had in mind is that if this were decided upon and you would be tied up for a year in condemnation proceedings by some obstreperous property owner, there would be no way to meet the requirements of the emergency relief act of 1932.

Mr. BRACKEN. I am quite sure that would not happen. And even if you had such an attempt, I can see no reason why you could not take immediate possession of the property and let the value be determined later on.

Senator DICKINSON. Of course, that depends upon the laws of the State of Pennsylvania, and I am not acquainted with them. There are some States in which you can not take possession until after there is an award, and then there may be an appeal noted to the superior court, and it takes another six months.

Mr. BRACKEN. In Pennsylvania that is not so.

The CHAIRMAN. I believe Senator Austin wishes to ask a question or two.

Senator AUSTIN. What is the present value of that lot and the adjoining lots?

Mr. BRACKEN. The value of the lot owned by the Fidelity-Philadelphia Trust Co.?

Senator AUSTIN. Yes.

Mr. BRACKEN. They have considered it to be worth at least the amount of the first mortgage, plus the expenses of foreclosure, and so forth, at which they took it in. That would put the valuation upon that part of the property at about $1,100,000.

Senator AUSTIN. How does that value compare with its value two years ago?

Mr. BRACKEN. I can not answer the question because I do not know of any appraisement made two years ago of this property. The last appraisement of which I have knowledge is the appraisement made in 1926. At that time the valuation was fixed at $1,400,000 by a very competent and conservative real-estate man in the city of Philadelphia. There has been, of course, a decline in the value of real estate in Philadelphia as elsewhere and, as I say it is very difficult to form a judgment as to what the real value is to-day because of lack of market.

Senator AUSTIN. Did you make the statement that the mortgage which was foreclosed was for 60 per cent of the value?

Mr. BRACKEN. No; I did not. It was more than that. The mortgage was for $925,000, and the appraised value as of the date when the mortgage was placed was $1,440,000. I think there was a margin then of about $500,000.

Senator AUSTIN. Have you stated what in round figures are the amounts of your proposal?

Mr. BRACKEN. Yes. We stated it in a letter to the Treasury Department.

Senator AUSTIN. Are you willing to state it here for the committee?

Mr. BRACKEN. Certainly. What we stated in the letter to the Secretary of the Treasury, when we were requested to submit a figure at which we would sell this property, the figure was $1,100,000 for the property controlled by the trust company. And we added to that an estimate at which we believed the additional properties, one of which was under option, could be secured, making a total proposal, conditioned upon the acquisition of the other properties, of $1,535,000, as I recall it.

Senator AUSTIN. I thank you.

Senator DAVIS. You say that the Fidelity-Philadelphia Trust Co. foreclosed that property on a mortgage of $1,100,000?

Mr. BRACKEN. No. The mortgage was for $925,000. But it had accumulations of interest, expenses, and so forth, of foreclosure, which ran the cost of the property to the Fidelity-Philadelphia Trust Co. as trustee up to just about the figure it named to the Secretary of the Treasury as the selling price.

Senator DAVIS. On what basis had the Fidelity-Philadelphia Trust Co. made their loan? Was it at the rate of 50 per cent of the value or 75 per cent of the value?

Mr. BRACKEN. Well, I do not think I am able to answer that question. Generally speaking, I should think in the past when loans were being made on real estate, some companies at least were quite happy to make a loan on 75 per cent of the value, for centrally located real

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estate where the valuation was conservatively fixed. And I think this was a conservative mortgage, having regard to values at that time, and having hopes of increased values, which everybody entertained in regard to property on the parkway.

Senator DAVIS. Would you say, then, that the mortgage was within about 75 per cent of the value of the property?

Mr. BRACKEN. I should think it would figure up about that, and it may have been slightly less than that.

Senator DICKINSON. It seems to me it would be very helpful to the committee in passing upon this bill if the proponents of the parkway site had a definite proposal that they could deliver the property at, and knew the property could be turned over to the Government if such a proposal were accepted. But it may be that it is not possible to present it in that form.

Mr. BRACKEN. In answer to that suggestion, it seemed to us that if this site were selected and the matter placed in the hands of the proper Treasury Department representatives, that they would be able to acquire the site at a figure less than this figure named, which seemed to the trust company to be the outside figure at which these various other small properties could be acquired for. It is difficult to go to anyone and get a definite commitment from him as to property without his knowing that it is going to be utilized.

Senator DICKINSON. Let me give you a little experience we have had here in Washington. In the expansion of the Capital Grounds there were certain properties that needed to be acquired in order to construct Constitution Avenue and its various intersecting streets. The property owners refused to accept the award which was the appraised value plus a certain percentage. That went into the condemnation courts and they got award of 100 per cent more than the allowance, and the committee refused to make the additional appropriation. I understand that now several of them have come in and are accepting the assessed value plus 30 per cent. In other words, poor old Uncle Sam usually gets gored when such a matter goes into the courts for appraisement, and I am very much opposed to it.

Mr. BRACKEN. You see, as to a goodly portion of this remaining property, one considerable piece is owned by the Pennsylvania company for the insurance of lives, and so forth, and a large trust company, and they are perfectly willing to sell at the price estimated to be its value in this proposal. There is another one, a $100,000 property, which is subject to option and that can be obtained almost immediately, leaving only two or three of the smaller properties outside to be acquired. I think it is quite inconceivable that these few remaining properties could not be very promptly acquired by the Government at prices less than those mentioned in this letter if this proposal should meet with the approval of the committee. The CHAIRMAN. Will you leave that map with us?

Mr. BRACKEN. Yes.

Senator BARBOUR. Mr. Bracken, I take it from what you say there is no element of promotion or speculation or anything of that kind in this suggestion?

Mr. BRACKEN. Absolutely none. The trust company has not one penny of interest in the enterprise, other than the interest that