Pei's partner and one-time student, Henry Cobb, was to be the architect in charge of our Canadian venture. I suspected that a New England Yankee might get along well in old Montreal, and twenty-eight-year-old Henry, a bright, very talented, and most circumspect young man, was the scion of an old Boston family.
Soon after our first New York meeting with Gordon, Cobb and I flew up to confer at the site. The "hole" Gordon wanted to fill was just north of the railroad station, the principal department stores, and the St. James Street financial area. A great, new building complex, a sort of Rockefeller Center-cum-Grand Central Station, could create a new center of gravity and focal point for the city. This location would provide the "centricity" which Montreal needed, and which we needed, to make the project click. I was enthusiastic, made no bones about letting the CNR know how we felt, and gladly committed Webb & Knapp to the $250,000 it would take to draw comprehensive plans.
By late winter and early spring of 1956, Cobb was ready with preliminary plans for Montreal. He and Vincent Ponte, our city planner, as well as some Look-magazine people who were doing a story on Webb & Knapp, flew up to Montreal with me in our DC-3. Circling the city at a few thousand feet, I looked over the site while studying Cobb's designs. Because we were concerned about the conservative atmosphere that pervaded Montreal, Cobb had prepared a step-by-step design. On an elevated platform plaza over the "hole," he set two rectangular towers plus a number of lower, subsidiary buildings. In this way, only after the first tower was successful would we need to put money down for the second structure. It was a competent and a pleasant design, but as I stood up in the steeply banked airplane, and looked out of the windows to the winter-gripped city below, I was dissatisfied. Something was missing. Here lay this unexploited but potentially fabulous site which only we could develop, but what we proposed to develop lacked power. As I began to sense what was missing, I said, "Henry, I want to tell you something . . . you don't make 'melly' out of a blue white diamond." The minute I explained that "melly" are merely the bits and chips left over when a great diamond has been cut, he saw what I meant. He, too, recognized that we needed something with enough critical mass to force changes on Montreal. By critical mass I mean not only the physical but also the emotional and the aesthetic impact of a truly successful building complex. We then and there set out the final specifications, within which Cobb was free to design as his genius dictated. I told him we wanted a major building of at least 1.5 million square feet total area, with at least 35,000 square feet per floor. It must be designed to provide corporate identity for more than one major tenant. Given these directions, Cobb went off to produce the plans of the great cruciform building that now so powerfully dominates downtown Montreal. This was the design that I took to Gordon. What we determined on that airplane was the most crucial decision of the whole Montreal project.
Through early 1956 Gordon and I held a series of meetings to hammer out just how we would work with one another on the project. Gordon is a man blessed not only with self-confidence but also with humor, which made these planning and bargaining sessions highly enjoyable for us all. Cobb sat in on all of these conferences so as to be aware both of the economics and of the nuance of attitude on which any agreement was reached. Normally such agreements are long and involved treatises which lawyers concoct with legal language which consumes page after page, but by now Gordon and I knew and trusted each other so fully that what we produced was a concise two-page affair in simple English. A key part of this final agreement was the master site plan, which we were to produce in six months.
That master site plan proved to be the conceptual basis not only of our venture but also of all following ventures in mid-Montreal. Rather than conceive of our giant building complex as an isolated venture, I had Cobb and Ponte plan it in context with the whole of the CNR's twenty-two acres, and, most important, with the surrounding area which we would affect. The plan, which was devised in close collaboration with Montreal's City Planning Commission, included marketing studies, traffic studies and details of proposed street widenings, underground parking, and pedestrian and vehicular crossovers. It involved studies and projections of peak-hour and off-hour pedestrian flow through various routes, the interactions between various routes, and detailed cost estimates of the various elements of the plan. That plan is what sold Gordon. As he says, with a faint Scottish burr, "When I saw the model, well . . . it was very handsome, but it was not necessarily real. Then I went over the plan, and that convinced me."
Gordon was impressed, but he was still Gordon. He had his engineers go over the details of that plan for six months. He formally accepted it in September, 1957. The Canadian government, which owns the CNR, approved the plan in December, 1957, and that month we signed a lease for our project, which I estimated would cost one hundred million dollars in total.
During this time I was moving on the financial and corporate front. In November, 1955, we had formed a new company, Webb & Knapp (Canada) Limited. One of the first things we did after that was establish relations with a Canadian bank, and I use the singular advisedly. This is because in Canada, unlike the United States, banking is a membership business. Once you are affiliated with one particular bank, that bank expects you to be loyal to it and to bank exclusively with it, or almost so. In exchange it gives its loyalty to you and will support you in your efforts. The bank we joined was the Royal Bank of Canada, which, more accurately, meant James Muir. When John McCloy, chairman of the Chase, heard that we were starting up a Canadian company, he had introduced us to Muir, the most powerful and controversial figure in Canadian banking. A dominant and domineering man who kept his aides in a constant state of terror, Muir was a tough competitor who had driven his bank from the second rank to the head of the industry. The Bank of Montreal, which for the previous hundred years had been the biggest in Canada, was now number two, and Muir did all he could to slow or crowd his prime competitors. Muir, a great sports fan, and a stout drinker (when he drank), laced his everyday speech with profanity worthy of a sergeant major. Highly dogmatic, he kept things simple: if you were his friend, you could do no wrong; if you were his enemy, you could do no right. If you were worth considering at all, you were in one category or the other. We became good friends because, although I could yell back at him when it suited, I was genuinely fond of this outspoken ruffian, and he liked and approved of what we were trying to do in Canada. He was of tremendous financial and psychological help from the beginning. So, too, was one of his directors, scholarly, quiet-spoken Lazarus Phillips, who gained and kept Muir's confidence through his own integrity and keen intellect. When we bought the solidly built Dominion Square Building for our Canadian company, the purchase was financed by the Royal Bank. Muir and Phillips gave good backing and advice in this and all our other Canadian projects.
In the meantime, armed with our basic agreement with Gordon, we set out to lay a monetary base for our new Canadian company. Graham Mattison, a lawyer and driving force in the New York investment firm of Dominick & Dominick, handled this job. His company, which had a strong branch office in Montreal, created a consortium of Canadian merchant banks to underwrite a package of bonds, convertible debentures, and common stocks, most of which Mattison was able to place through banking connections in Switzerland. This issue brought in some twenty-five million dollars which almost immediately began bearing interest at 5½ percent. Since we had no income to speak of in Canada, we went out looking for short-term investments where we could put the money to work and draw it out later for the project. For instance, we used some ten million dollars of this new money to buy a group of some 277 gas stations owned by anew oil company in Canada, Petrofina. We leased these stations back to Petrofina for ten percent, which, right away, gave us one million dollars a year against our interest payments, and we later quite profitably sold off the stations as we needed money for construction in Montreal.
At the start of the winter of 1957–1958 we had a lease and we had a wonderful plan, we had a great hole in
the ground ready for filling, we even had a name for the project: Place Ville-Marie. But when we went looking for tenants, every major company in Canada turned us down.
We were in trouble from the beginning, because we were strangers and foreigners. And later the Montreal establishment would be spiritually in arms against us, because, to round out the property around the "hole," we had, in "collaboration" with Mayor Drapeau and the City of Montreal, arranged to expropriate and demolish the venerable St. James Club. This stately watering spot was established in 1863 in a fine building on the corner of Dorchester and University streets. There, for ninety-four years, some of Montreal's most solidly established English Canadians and their fathers and grandfathers before them had been quietly spending the afternoons and escaping their womenfolk in the evenings. Quite apart from this desecration and razing of a local temple and wildlife refuge, our project was originally resented because it threatened the stuffily stable state of affairs down at St. James Street, where every major bank and company was located. Not only did these gentlemen not like to see their ancient, dark-paneled offices made obsolete, but the very idea of a shift to center-town offices struck many as dangerously radical. The banks that competed fiercely with Muir's Royal Bank were most reluctant to advise their clientele to aid any allies of his. But essentially our trouble was that nobody, not even Muir's friends, actually believed we would ever put up a project as big as we said we would. No matter where we went, we were turned down. Du Pont of Canada gave us a particularly haughty rejection, and Canadian Industries Limited, though we offered them five million dollars for their old building as an incentive to move to our new tower, also showed us the door.
If we couldn't get a major tenant, we couldn't get mortgage financing from an insurance company. This meant we couldn't get any interim bank loans to finance construction—and this meant that we and Place Ville-Marie were dead. All that winter of 1957–1958 I kept trying, but the ironclad faith of the local business community that we could not get going kept anyone from committing themselves as tenants. Meanwhile, the "hole" kept getting bigger. We kept digging, putting up scaffolding, and working the architects, if for no other reason than the psychological impact on the community; but the local business community were not impressed. By late winter we were four million dollars out of pocket, with nothing to show but the air in the hole we had broadened. The cold Canadian front we were encountering had reached deep into my bones and into my pockets. Numbed by months of this exposure, I did not know where to turn next, until one gray day, walking by the black-and-white, soil-and-snow landscape of the site with my son, I had a thought.
I said to him, "You know why we are not getting anywhere with this damn thing? Because we are tied in with a powerhouse like Jim Muir. His enemies are not going to take a lease in there. And we haven't gotten anywhere with his friends because they don't believe we are going to build. There is a lot of prejudice and antipathy in Canada, particularly in Montreal. They don't want Americans, and especially an American Jew [myself] with a Chinese [Pei] for his top architect. These guys are provincial as hell . . . and they don't like it; we are interfering with their nice infield way of life. . . . I'm going to call Muir."
That weekend, calling from my home in Greenwich, I got Muir on the phone and said, "Jim, you know we are not getting anywhere with this damn renting."
He roared back, "Why the hell should you get anywhere? That goddamn Chinaman is stopping you."
"No, you're stopping us."
"I'm stopping you?"
"Jim, your enemies, the ones who hate you, won't take space here. The ones who love you don't believe in us. There is a gang-up on the part of the other banks, the Bank of Montreal, the Imperial Bank, the Canadian Bank of Commerce, the Bank of Nova Scotia, Toronto Dominion . . ."
He said, "You're crazy."
"I'm not crazy."
Then he said, "Well, what do you want me to do about it?"
"Move."
"I should move? Move? You're mad."
"Move, Jim. We'll call the new tower the Royal Bank of Canada Building in Place Ville-Marie. You will be king of the hill, towering over the whole of Montreal. The business will come to you."
"You're out of your mind. We have the biggest bank in Canada in the biggest bank building in Canada."
I said, "I'll buy it from you."
"You've got no money to buy it, you ________ Jew."
"Now, look here Jim, think this over. I'm coming up tomorrow morning to a directors' meeting."
"Och," he interrupted, "I'm going to England. I don't get back for two weeks. Forget about it."
"No, you think it over, Jim. Call me tomorrow and tell me how you feel about it."
I arrived at our Canadian office at 9:30 next morning, and there were three calls from Muir. When I called him back I said, "Why don't you go to England, and appoint three members of your staff to study this thing while you're gone? We'll have three members of our staff work with them, and when you get back, you'll have a report on it. If it's no good, you don't have to do it. If it's good, you'll do it."
"Well," he said, "all right, I'll do it, I'll appoint three people, but you are crazy anyway." And he hung up.
We put the team together, and when Muir got back in two weeks, they made a report. It was affirmative, and three weeks after that we started drawing up the leases, which involved our buying their building and their moving into the tower. That started the Royal Bank of Canada Building going.
I have often noticed, but never been so rash as to delve into it too deeply, the traditional similarity of bank, temple, and cathedral interiors. This deistic design style has begun to fade in the United States, but in Canada no self-respecting bank would ever move into a building that did not boast a great cathedral of a banking hall. Fitting a properly gigantic Canadian banking hall into Cobb's stark new building was a desperate problem until he conceived of the four great, blocky quadrants now at the base of the structure. These quadrants, which, happily, visually stabilized and accentuated the structure of the building, were conceived of and readied for presentation to Muir in six hectic weeks. As Muir walked into the conference room to look over the plans, the finishing touches were just going onto the last drawing. Muir liked that. He also liked the plans and, typical of the man, rather than consult with his directors about a move, he called them together, announced his plans, and then led them out to look at a model of the bank's future home. This was in May, 1958.
With this coup dangling from my belt, I went down to see my friend Fred Ecker of Metropolitan Life, to borrow seventy-five million dollars. The complex would cost one hundred million, of which we had twenty-five million. When I came in the door, Ecker grinned and said, "Bill, what in hell are you ever coming to see me for?"
"Because you said if I got a top tenant you would be interested in financing us in Canada. Now I have the Royal Bank for seven floors, and I want seventy-five million dollars."
"Seventy-five million! That's more money than there is in Canada."
Ecker lent me fifty million—with strings. He wouldn't lend the money on just the Royal Bank lease, I had to get another one. So I went to see Nat Davis, who is chairman of the board and president of Aluminium Limited and a nephew of Arthur Vining Davis of Alcoa.
Davis, a handsome, slender, youthful-looking man who stems from a top Pittsburgh family, is smart and tough. As regards Canada, Davis was nominally a member of the opposite camp, a director of the Bank of Montreal, but as an American he didn't think as clannishly or at least not as much so as many of the people around him. He was interested in doing the best thing he could for his company, and this is what I was counting on. I told him that we wanted to rent him major space in our building. He countered by saying that they were thinking of putting up their own building. The fact that they were even thinking of putting up new offices gave me hope, and I argued my case with renewed enthusiasm. We made layouts showing what their new quarters would be like. We made great concessions and expensive additions
on interior design; I just had to get Davis in as tenant to crack that fifty-million-dollar nut Fred Ecker was holding out for us. For three months I romanced Aluminium, calling on Davis again and again, and he was very tough, but finally I said, "This building is going to be such a great. . . so fantastic a structure that you just can't afford not to be in it."
He said, "What do you mean?"
I told him that we were going to put up the greatest showcase for aluminum in all the history of Canada, if not the whole world.
"How will you do that?" he asked.
And I answered, "We are going to have to sheath this thing with some kind of metal. If you are in this building, it will be aluminum. If you are not, it might be something else. Let's assume it is something else—wouldn't that be an opportunity for your competition? Like, for example, copper, or bronze, or steel? Or, let's assume it is aluminum and you don't move into it. This would be a terrible negation of your own product." Of all the arguments I could bring to bear, that one, I think, is what made it. At last, in September, 1958, he agreed to move.
These two key leases were good-sized deals in themselves. The Royal Bank's lease provided 2.6 million dollars a year in rent for fifty years. Aluminium Limited's was two million dollars a year for twenty years. Next we got in the Montreal Trust Company at $750,000 per year. This came to fruition after Don Kerlin at the Trust had turned us down, but I got him on the phone, saying, "Don, I know you have said no, and I know that you mean no . . . but let's talk for a minute. . . ," and the logic of what was now taking place in Montreal was so persuasive that Kerlin took that lease and was glad of it ever after. Later we made a fine deal for another $750,000 with Trans Canada Airlines, now Air Canada, and with names such as these lined up, all Montreal now realized that our project was no dream but a great reality. The great freeze-out of 1957–1958 had cracked and thawed, and the city would never be the same.
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