Architecture and real estate speculation during the second half of the nineteenth century

During the second half of the nineteenth century, most major European capitals were affected by real estate speculation. These transactions involving the subdivision and construction of revenue houses involved deposit banks—which invested and speculated on the transformations of cities through the creation of real estate companies—as well as entrepreneurs and architects. The latter played an important role that was no longer limited to designing buildings, but also extended to the administration of companies and the effective completion of projects: they expropriated, built new roads, and divided land into lots, thereby actively contributing to urban transformations, with speed and economy of construction taking precedence.


“M. Donon, President of the Société des dépôts et comptes courants,” in Comic-Finance, Journal satirique financier (Financial Comic, Satirical Financial Review), October 23, 1873.

Far from involving solely the major works conducted in Paris by Napoleon III (1808-1873) and the Prefect Georges-Eugène Haussmann (1809-1891), with which it is generally associated, real estate speculation affected all major European capitals during the second half of the nineteenth century. As defined by the Grand Dictionnaire Larousse du xixe siècle, published between 1866 and 1877, speculation is a combination of commercial or industrial operations seeking to generate appreciation in value, and therefore amounts to “purchasing for the purpose of resale.” Applied to real estate, it involves various financial combinations in which the purchase of land, subdivision into lots, and finally rental or resale management follow one another, with the sole aim of generating the most profit. During the second half of the nineteenth century, such practices played a decisive role in the development of railroads and canals, as well as the sanitation of cities and urban development.


Financial companies and real estate speculation

The major works initiated by Napoleon III in Paris made the French capital into a model city. It served as an example for the remodeling of many other French urban centers, including Marseille and Lyon, as well as European capitals such as London, Brussels, Rome, Lausanne, and Geneva. These urban transformations involved the expropriation of land, the laying down of new roads, and the creation of plots, all of which are operations conducive to speculation.

Banks and financiers therefore took an interest in these new markets: Armand Donon (1818-1902), the baron de Soubeyran (1828-1897), or the brothers Émile (1800-1875) and Isaac Pereire (1806-1880), lent, invested, and speculated on the transformation of cities by creating real estate companies that sometimes subdivided entire neighborhoods into lots. These considerable transactions requiring large amounts of capital were backed by their deposit banks. In 1852, the Pereire brothers founded Crédit mobilier, which specialized in long-term credit for industry, while Armand Donon, who was already behind Crédit industriel et commercial (CIC) in 1859, established on the same principle the Société de dépôts et comptes courants in 1863, which granted him greater powers.

These financiers could combine their activities through corporations specifically created for the occasion. La Caisse de Trouville-Deauville was founded in 1859 by Armand Donon, the duc de Morny (1811-1865), and his doctor Olliffe (1808-1869) in order to get a “good deal” by buying 177 hectares of land that year, which they would subdivide and sell for twenty to sixty times the purchase price. These financial companies attracted investment from European financiers. English bankers held stock or served as board members for companies in France, such as the Société immobilière anglo-française (Anglo-French Real Estate Company) created in 1865. French capital was also invested abroad: the bankers Armand Donon, Maurice Aubry (1820-1896), and Jules Gautier (1822-1897) bought part of the domain de Bercy in London, while the Belgian financier and entrepreneur Jean-Baptiste Mosnier (1822-1882), who was from Paris, played a central role in the construction of 62 buildings in Brussels.


The development of the architect-financier

The creation of these various companies designed for real estate speculation generated closer collaboration between bankers, architects, and entrepreneurs, who henceforth acted as collaborators, employees, stockholders, and even property managers. Architects were essential to the speculative affairs of real estate companies, which they helped to develop by providing their technical and scientific skills in matters of construction, subdivision, and urban planning.

Many financial companies called on the services of accredited architects, who acted almost exclusively for them and were in charge of various operations. For example, the two companies that undertook the transformation of the Marbeuf neighborhood in Paris, the Société du quartier Marbeuf and the Société générale immobilière, relied on their respective architects, Henri Blondel (1821-1897) and Paul Fouquiau (1855-?). The Société immobilière genevoise decided to directly hire Francis Gindroz (1822-1878), while his colleague Alfred Armand (1805-1888) became one of Pereire’s right-hand men.

These general contractors surrounded themselves with a network of entrepreneurs who, in an effort to reduce costs and increase profits, were asked to repeat the same construction models by using the same architectural language and materials. In order to follow the instructions of speculators, who were first and foremost looking for speed and low cost, they did not offer any particular esthetic exploration in their constructions, but focused on economy in order to obtain the greatest possible appreciation at the moment of resale.

These constraints applied to the architect Henri Blondel, who entered into the service of Armand Donon and his collaborators, and erected 172 revenue houses in Paris and Brussels, often thanks to the banker’s financial support. In order to reduce costs on the construction sites he managed, during the 1880s he used not only the same entrepreneurs and materials, but also the same layouts, handrails, doors, etc. Cost optimization sometimes led to the identical reproduction of the same houses, as in the rues de Bernoulli and Andrieux in the Europe neighborhood of Paris.

The architect sometimes performed additional duties within these real estate companies, and in addition to practicing their art could serve as shareholder, property manager, and even founder. The figure of the architect as the property manager of a company is also demonstrated by the example of Henri Blondel. He was not content with working as an architect in the service of bankers, and instead managed or created a dozen financial and real estate societies in France and Belgium, with a purely speculative goal in mind: they had to proceed with expropriations, lay down roads, and subdivide into lots. In Switzerland, Louis Joël (1823-1892) also held multiple roles in real estate speculation, and in addition to his occupation as an architect became Director of the Société immobilière d’Ouchy by managing the Société immobilière lausannoise.

During the second half of the nineteenth century, major works in Paris and the development of new banking practices helped to spread the figure of the architect financier, who was simultaneously a builder, property manager, and stockholder, and active at all levels of real estate speculation. Architects therefore contributed to the development of this phenomenon in Europe, as well as to the increased circulation of financial resources and, more naturally, to the diffusion of construction models throughout European cities and countries. They nevertheless could not act alone, and relied on bankers who provided the financial basis for the real estate company, thereby actively contributing to these works as well. This long movement gradually ran out of steam beginning with the economic crisis of 1882, which was followed around 1890 by the bankruptcy of numerous banking and entrepreneurial groups.

Translated by Arby Gharibian

To quote from this article

Elsa Jamet , « Architecture and real estate speculation during the second half of the nineteenth century », Encyclopédie d'histoire numérique de l'Europe [online], ISSN 2677-6588, published on 22/06/20 , consulted on 12/07/2024. Permalink :


Lescure, Michel, Les banques, l’État et le marché immobilier en France à l’époque contemporaine (Paris: Éditions de l’EHESS, 1982).

Lüthi, Dave, eds., Le client de l’architecte. Du notable à la société immobilière : les mutations du maître de l’ouvrage en Suisse au xixe siècle (Lausanne: Étude de Lettres, 2010).

Stoskopf, Nicolas, Les patrons du Second Empire. Banquiers et financiers parisiens (Paris: Picard/Cenomane, 2002).

Yates, Alexia, Selling Paris, Property and Commercial Culture in the fin-de-siècle Capital (London: Harvard University Press, 2015).


Don’t miss a single publication! Register now to receive our newsletter in English:

The subscriber's email address.
Manage your newsletter subscriptions
Select the newsletter(s) to which you want to subscribe.