THE RENT GRAFT.
The excess rental profit, due to the fact that at least 1,000 buildings in Chicago are the rendezvous or dwelling places of prostitutes and women of loose character, is today $1,000,000.
This figure is based on the conservative estimate of the Vice Commission arrived at in its recent investigation. In its calculation the members began with the figure of 577 places immorally used. They conservatively estimated that $1,000 was the average excess profit of rent in open houses in the restricted districts, and $300 was a similar profit per year on “flats” and assignation hotels.
This same profit would not exist if vice did not place a high price on the haunts where it thrives. If the profits on vice are so enormous, the Vice Trust figures that the resort keepers and hotel and “flat” renters can pay high prices.
The prices for rent on “flats” are boosted from $20 to $40 above the actual rental valuation of the property.
The rental price on property in the segregated parts of the city is raised five times the actual rental figure.
The real estate owners, and the real estate agents raise the price. But they cannot steal this vast rental profit. The Vice Trust must have a share. A split is made. The lords of the vice combine get their share of the rental theft and back into the pockets of the Directorate of Ten goes the graft.
If this money is not paid by the real estate men and property owners, then they are the losers in the long run. The police department closes the place, refusing to allow prostitutes to live in the building.
Result: The property must be rented to people of poor condition who can pay but small rent. The physical value of the property is so small that a large rent could never be exacted from decent citizens. Therefore in order to make a profit himself, the lessor holds the rent high, countenances prostitution in his buildings and pays his graft to the Vice Trust.
A certain real estate agent controlling a building in Cottage Grove avenue, which is infested with immoral “flats,” declared that he boosted the rents in the building $30 for each flat above the actual rental valuation. This same man declared that he was obliged each month to hand over to detectives who visited him, $20 on each flat, leaving him but a boost of ten dollars per flat.
A woman who keeps a “flat” in Cottage Grove avenue declared that she was compelled to pay $50 for a $25 flat. She argued with the real estate agent but he showed her that if she desired police protection she would have to meet the demand. She did so.
Some time later, on account of public protest by clean-living citizens near this place, the police shut down the “flats” in the building in one day. The women inmates moved out. A week later those flats which had rented from $40 to $75 to the immoral women, were rented for $15 to $25 a flat.
Another example of the rent graft is given on the West side levee. A resort keeper who was once known as a king of the West side levee, owned a two-story building, which was used as a house of prostitution from which he derived the enormous rental of $250 a month. The place was situated in Curtis street. The street was “wiped out” by the police. A week later the two flats were being rented for $20 apiece.
There is one estate in Chicago today situated in a levee district which is valued at $1,000,000. If the segregated districts were wiped out this property would not be worth $20,000.
As an indication of the difficulty that would be experienced in wiping out this graft, remember that three city officials are owners of property used for immoral purposes. They are members of the great Combine. They would not permit the destruction of the immoral “flat” system because it would deprive them of an enormous revenue.
This rental graft is either paid to the police who take a small percentage and then turn the remainder over to the agents of the Directorate of Ten, in return for their protection, or is given to the vice powers direct by the real estate agents.
This rental graft is one of the big factors in maintaining a City Defiled. To strike at these places is to strike at the vice lords not alone through their enslaved women but through their property valuations.