Lot Sales in 1874
Many of the earliest investors purchased additional
lots in 1874. Not lots for their own houses which they had purchased the
year before and where they were building their houses, but lots all over
the map. Why? Probably because a paralyzing financial panic broke out in
1873 in the Country, caused basically by over-speculation and over-expansion
in mining, manufacturing, the railroads, and grain farming. Also, the currency
had seriously depreciated. The Republican majority in Congress was defeated
by the Democrats in 1874 causing political chaos. It was not until Rutherford
B. Hayes was appointed President in 1877 by Congress, that the economy began
to settle down. We think what happened in 1874 was that there was a need
for an infusion of cash that third season to keep the development from failing.
Not so many people were steam boating out to Shelter Island to participate
in the auctions for lots. The development needed cash. Those with deep pockets
-- at least ten men -- between them bought at least 60 lots.The list of lots looked random at first, but by mapping the purchases for that year it is clear that small syndicates were put together to buy contiguous lots.
It appears, that despite the Panic of ‘73, the developers did a decent job of keeping the community afloat. Still it was not taking off as the resort the developers had hoped it would.
By the end of 1874, the real estate structure of Prospect Grove had been established. Never again would the Association sell more than a dozen lots a year. Most of the peninsula would become a nine hole public golf course, which would eventually be turned over to the Town of Shelter Island. The 1992 Registration for a Historic District designation listed 175 structures, with 142 contributing historic significance. (1875 Structure Map)
By the end of 1874, the Association had sold an additional 121 and added $23,548 to its coffers.
Capitalization would continue to be a perennial problem.