Business History
Who Was Henry Flagler?
In need of capital for his new venture, Rockefeller approached Henry Flagler. Flagler would secure $100,000 from his wife’s cousin provided he got 25 percent of the shares in his new oil refinery.
Excerpted from DOWNTOWN MIAMI HISTORY*.
When the Civil War ended, Flagler re-entered the grain business as a commission merchant in Cleveland, Ohio, and became acquainted with John D. Rockefeller, who worked as a commission agent with Hewitt and Tuttle for the Harkness Grain Company. In the 1860s, Cleveland was quickly becoming the center of the oil refining industry in America, and Rockefeller decided to leave the grain business to start his own oil refinery. In need of capital for his new venture, Rockefeller approached Henry Flagler. Flagler secured $100,000 from his wife’s cousin on the condition that he be made a partner owning 25 percent of the shares in the new company of Rockefeller, Andrews and Flagler.
On January 10, 1870, the Rockefeller, Andrews and Flagler partnership was organized as a joint-stock corporation named Standard Oil. In just two years, Standard Oil became the leader in the American oil refining industry, producing 10,000 barrels per day. Five years later, Standard Oil moved its headquarters to New York City, where Flagler, wife and son moved to their new home at 509 Fifth Avenue. One of the defining elements in the success of Standard Oil was Flagler’s negotiations for favorable train freight rates, which gave them the competitive edge.
In 1878, his wife Mary fell ill, and died on May 18, 1881, at age 47, leaving Henry Flagler with a young son to raise alone. Two years after her death, he married her nurse, Ida Alice Shourds.
A Second Wife and a Second Career
Flagler was eighteen years older than his 35-year-old bride. The couple traveled to St. Augustine, Florida, which they found charming but lacking in adequate hotel facilities and transportation systems. In effect, the Florida rail system was chaotic, created by several owners and speculators. Flagler saw the potential to attract tourists if the transportation system was fixed. Flagler purchased the Jacksonville, St. Augustine & Halifax Railroad, the first step of what became the Florida East Coast Railway system.
Though Flagler remained on the Board of Directors of Standard Oil, he pursued his interests in Florida. In 1885, he began construction of the 540-room Hotel Ponce de Leon in Saint Agustine. It opened January 10, 1888, to great success. Flagler began building a hotel empire. In 1894, he built the Hotel Royal Poinciana in Palm Beach and extended his railroad further south to West Palm Beach. The Hotel Royal Poinciana soon became the largest resort in the world.
Flagler had been thinking about extending his railroad and hotel system all the way to Key West. However, the timing of his plans was accelerated somewhat when the severe freezes of 1894 and 1895 affected the area around Palm Beach, but not the settlement of Fort Dallas, about sixty miles south. Julia Tuttle offered Flagler land to bring his railroad further south.
Flagler visits Julia Tuttle
He traveled by train from St. Augustine to Palm Beach, by boat to Fort Lauderdale, and the remaining thirty miles by foot, horse and carriage — arduous journey for a man in his sixties. Judging by the presence of his chief of railroad operations and hotel designers, he probably had his mind made up and he soon struck a deal. He received half of her allotment, plus one hundred acres for the train terminus, and his grand hotel. Another one hundred acres he got from William and Mary Brickell on the south side of the Miami River. In return, he promised to bring the railroad within a year and build a grand hotel, the Royal Palm, and create a modern city. It took him 10 months to build the railway, from start to finish. The first train arrived April 15, 1896.
Appearances
How did Flagler appear to Julia Tuttle? There is no record of her intimate thoughts about Flagler. But Les Standiford rescued a description by Edwin Lefevre, a financial writer for the New York Sun, who had been sent to interview Flagler, that might have coincided with her perception: “His hair is of clean, glistering silver, like the cropped mustache and eyebrows. They see his complexion, which is neither ruddy nor baby-pink, but what one might call a virile red. He has a straight nose and strong chin… The eyes are a clear blue — some might say violet. They must have been very keen once; today their expression is not easy to describe, not exactly shrewd nor compelling nor suspicious; though you feel they might have been all of those, years ago… eyes that gleam but never flame… Handsome old man! Under his fourscore years, shoulders have bowed slightly but there is no semblance of decay.”
And how did Julia Tuttle appear to Flagler? In the words of historian Helen Muir, Julia Tuttle was almost a beauty. “Her face is a tad too square for perfection, but her vivacious determination and femininity captivated men.”
Green-Turtle Soup
Julia Tuttle treated Henry Flagler to lunch at the Peacock Inn in Coconut Grove, and over a delicious green turtle soup that Isabella Peacock had prepared for the occasion, they struck the deal — and hence her dream of a great city took a giant step towards reality.
*This chapter of DOWNTOWN MIAMI HISTORY draws in part from Flagler’s biographical information provided by the Flagler Museum, and other historical archives.
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