Chicago’s Sherman House faced the Courthouse at Randolph and Clark Streets.
By Megan McKinney
The Leiters: Chicago’s British Aristocracy
During the summer of 1854, the Sherman House, at the intersection of the bustling Randolph and Clark Streets, was Chicago’s newest and most ambitious hotel. A guest climbing to its rooftop dome at sunrise was offered an unobstructed panorama of the emerging city at daybreak. Barely visible to the west, almost lost in a low haze, were the wide verandas, smoke houses and stables of fine horses belonging to a prosperous colony of genial Kentuckians who were settling along what is today Ashland Avenue, home to several generations of Wallers, Honorés and Harrisons. Further west, and stretching beyond view, the visitor might sense monotonous miles of flat prairie waiting to be cultivated and developed.
Toward the north, two blocks from the Sherman House, unseen seamen were beginning to stir under the masts and rigging of the ship-choked Chicago River. And, past the river in a silent world apart, golden images of the rising sun flickered in vertically paned windows of serene white villas. These portico-fronted houses of the city’s original settlers were surrounded by flowering shrubs beneath great shade trees, elms, oaks and cottonwoods, all that remained of an ancient swampy forest now drained and cleared of underbrush. Within the foliage-encircled mansions lived Chicago’s leading citizen and first mayor, William Butler Ogden, and others of Chicago’s “aristocracy.” It was from this privileged enclave that visiting foreigners and Easterners returned home, bringing reports of being entertained with style in the new Midwestern city.
William Butler Ogden.
Also across the river, but further to the east and extending along the lakefront, leaned the precarious huts and shanties of a notorious district known as the Sands, home to a despised underclass of thieves, drunks and wantons. And, east of the Sands, stretching out to the horizon — rippling and shimmering in the early morning sun — splashed the blue waters of a portion of America’s vast interior freshwater sea known as Lake Michigan.
Everything in mid-19th century Chicago stretched out from the Courthouse.
Yet, the most compelling sight to the ambitious newcomer was a view south — across Randolph Street and past the city’s year-old Courthouse — that the eager viewer would observe, and perhaps evaluate, streets lined with a broad assortment of properties, many residential. It was real estate that even a neophyte would know was tenuous, fated soon to be displaced by commerce as the energetic business district expanded.
Looking east and south from the Courthouse.
When 20-year-old Levi Ziegler Leiter arrived in Chicago that summer, it was from Leitersburg, Maryland, which had been settled by his Swiss Mennonite ancestors. After a year in Springfield, Ohio, where he had lodged with a cousin while working in a local store, he traveled on to Chicago.
Almost immediately, the savvy novice learned of the Sherman House, recognizing it as an appropriate base from which to launch his ambitions. After securing a position as bookkeeper with Downs & Van Wyck, a nearby merchant, Levi negotiated the lease for a room in the hotel, where he would live for the next three years.
Ralph Waldo Emerson.
The location of the Sherman House and the excellence of its clientele made the price of Levi’s new quarters a shrewd investment for a prospective entrepreneur already practiced in weighing quality against cost. Among the hotel’s periodic visitors during those years was philosopher Ralph Waldo Emerson, who reported that his fellow guests were often American Easterners, which he felt accounted for the fact that they were “earnest and active,” and “quite intelligent.” Sherman House amenities included passenger elevators and gas lighting in the rooms, as well as complimentary candles for traditionalists who still wished to live by candlelight.
The Chicago of the mid-19th century was unruly and chaotic, yet electrifyingly dynamic. However, its most striking characteristic was the viscous mud forming the business district’s streets and pathways. Despite the city’s almost miraculous growth and increasing sophistication, low priority had been given to pumping out the sea-level central area, installing a system of drainpipes and raising the city’s surface above lake and river heights.
Appallingly poor drainage and sewage disposal were more than travel hazards and unaesthetic nuisances; epidemics of typhoid and dysentery plaguing Chicago for the previous six years had risen to a new level of concern that summer. Throughout the area people were talking about the outbreak of a new scourge, thought to be cholera, which was claiming citizens at the rate of 60 a day.
Levi was unperturbed even though he often saw the horse-drawn “death cart” plodding through downtown streets, bearing its grisly cargo to lime pits outside the city. Inadequate sanitation did little to discourage Leiter, secure in his hotel with a modern bathroom on every floor, providing hot water, soap and fresh towels for its guests.
The winter that followed was bitter, the coldest in memory, with mounds of snow heaped on top of frozen mud. The old settlers living in the white villas of the North Side — hardy pioneers who had created the city in the 1830s — believed the climate had profoundly changed that year, proving Levi’s Sherman House investment wiser even than he had thought in the summer.
Few Chicago hotels provided the central heating of the Sherman House, and the fireplace in his room, blazing in the early morning and late afternoon, continued to provide a glow long after he retired.
When summer finally arrived, Levi made an important career move, leaving Downs & Van Wyck to accept a position with the city’s largest dry goods wholesaler, Cooley, Wadsworth & Company, located next to the bustling Chicago River on South Water Street. He worked first as an office clerk–then bookkeeper, accountant and eventually credit specialist–and he met the first of the giants, the men with whom he make dry goods—and Chicago–history.
Potter Palmer.
Potter Palmer was born in Potter’s Hollow, Albany County, New York, in 1826, son of a prosperous Quaker farmer. After clerking for a short time in a nearby dry goods store, the 18 year-old opened a shop of his own in upstate New York, but after visiting Chicago in 1851 he decided sell the New York State store and move west. He soon established P. Palmer on Lake Street, the city’s most prosperous commercial stretch, and like Levi Leiter he identified the Sherman House as an appropriate home for an ambitious young bachelor.
Palmer Dry Goods & Carpets (the sign maker charged by the letter) is prominently displayed at the top of the tall building toward the right.
Before long, Palmer was navigating his company into tradition shattering areas; by 1855, he had begun to transform the existing concept of retail trade by focusing on women—especially women of means. He was on his way to introducing practices that would revolutionize the shopping experience when the third of the retailing giants arrived.
The Young Marshall Field.
Marshall Field, another farmer’s son with no interest in farming, was born in 1834 outside Conway, Massachusetts. After five years of clerking at a dry goods store in neighboring Pittsfield, he moved to Chicago during the winter of 1856 hoping to work for Potter Palmer. But this was not to be — at least not yet — and it was only though the extreme persistence of Marshall’s brother Joseph that he was hired by Cooley, Wadsworth, where he quickly learned the inventory and impressed his employers with his courteous manner. The frugal young man worked 18 hours a day, and saved half his four hundred dollar annual salary by sleeping on a pallet in the store at night.
Levi Leiter.
Although their styles and to some extent their values differed, Leiter and Field bonded at Cooley, Wadsworth. The heavily bearded young Levi has been described by one source as “dynamic…bushy-whiskered and irascible, with unquestionable integrity and an outstanding gift for finance” and by another as “generous, opportunistic…burly and brusque,” adding that “Levi talked things to death…and had a hundred friends.” Whereas the clean-shaven, carefully spoken and meticulously well-mannered Marshall was “painstaking, analytical, and measured.” One of Field’s most fundamental traits throughout his long career was a determination to maintain a cushion of cash for either a downturn or an opportunity.
Although he respected quality and spent amply to obtain it once he had achieved his objective, the thought of paying for quarters at the Sherman House when he could accumulate capital by sleeping at the store would never occur to him. However, the two young men devoted their little free time to making plans for the day when they would possess a company of their own.
Cooley, Farwell principal John V. Farwell would become a leader in the wholesale dry goods industry nationally.
Changes at the upper levels of the Chicago dry goods business had begun accelerating with the approach of the Civil War, including the firm that was now Cooley, Farwell & Company. In 1860, both Levi and Marshall were awarded the opportunity of purchasing junior partnerships in Cooley, Farwell, a privilege that would cost each $100,000 in loans from the firm. After discussing the matter between themselves, the young men decided to take advantage of the offer. This was not a frivolous move by either the company or the new partners, but rather based on the correct assumption that war would bring a vast upsurge in dry goods profits.
It was however Potter Palmer who had benefited from the war bonanza more than any. Palmer’s increase in personal riches had come at the expense of his health, generating another Chicago dry goods upheaval. When his physician sternly suggested he retire from active business, Potter began looking for a pair of partners to bring into his remarkable firm. The driven Palmer recognizing similar ambition in Leiter and Field–by then a notably forceful and effective duo–saw the motivated young merchants as the obvious choice.
In January 1865, Potter’s business became Field, Palmer, Leiter & Co., with Marshall signing a two-year note to Palmer for roughly a quarter of a million dollars, and Levi pledging another $120,000. The contract with Palmer gave Field and Leiter ownership of the store’s real estate and inventory, and Potter’s contribution consisted of the $330,000 working capital he left in the business. It was a tenuous two years; however on January 1, 1867, the firm became Field, Leiter & Company, one of the most celebrated names in dry goods internationally throughout the next decade and a half.
Palmer’s genius had taken him to a brilliant new career, real estate development. Before creating the North Side residential area for which he is now celebrated, he transformed a seedy former Indian trail into the city’s premier shopping mecca, State Street. He anchored the stretch with his own magnificent Palmer House Hotel and a six-story Corinthian-columned, mansard-roofed emporium at the corner of State at Washington Street, known as a “marble palace,” and leased it to Field and Leiter for the exorbitant annual rent of $50,000. With these two colossuses securing the avenue, the reputation of “that great street” was established, leaving savvy merchants no choice but to lease Potter’s State Street shops.
The original Palmer House.
On October 12, 1868, Marshall and Levi’s glorious new store opened, giving them the arena in which to embark on their dream, pulling together everything they had absorbed in partnership with Potter Palmer. It was a spectacular launch for two men still in their 30’s, who had no reason to suspect the sturdy grandeur of the marble palace might be short lived.
The $50,000 a year marble palace.
Almost precisely three years later, during the evening of October 8, 1871, a catastrophic fire broke out in the dry autumn air of Chicago’s West Side. Energetic winds whipped the flames eastward and within hours the center of the city was burning, along with the Palmer property lining both sides of State Street.
Field and Leiter, who had been awakened by alert employees, arrived at their store almost simultaneously. With flames approaching from the west, Levi organized men who removed the most valuable goods while Marshall supervised a soaking of blankets, which were hung from the store’s open windows to prevent an overheating and crumbling of its walls. A third executive jump-started operation of the store’s steam elevators by lighting a fire in the furnace, breaking up boxes and feeding them into it, thus facilitating the urgent removal of merchandise to the sidewalks, where goods could be loaded to wagons. Rather than sending their wagons to the lakefront as other merchants did, Levi directed them south to his Calumet Avenue house and to a nearby schoolhouse, both out of the fire’s pathway. Throughout the night employees continued to spray the walls with water from the store’s pumping stations in an attempt to save the building, but without success. By morning the store was a smoldering ruin of warped steel and powdered marble.
Field, Leiter & Company after the fire.
Within days a temporary Field, Leiter & Company opened in the empty car barns of the Chicago City Railway Company on the South Side. Because the partners had invested in insurance worth $2,200,000, their losses were minimal. They had continued a philosophy of always conducting business in cash and maintaining a sizable reserve and therefore were able to meet current obligations without tapping insurance money. Six months after the Fire, they reopened in a five story building at what is now Madison and Wacker and, despite several interruptions including another fire, Field, Leiter continued to prevail.
The Leiters: Chicago’s British Aristocracy, Megan McKinney’s series of articles on this remarkable dynasty, will continue in Classic Chicago over the next several weeks.
Next Sunday: Skyrocking Riches
Author Photo:
Robert F. Carl
