central
and western Germany to promote general agricultural and urban real
estate operations. The colonists sent into Poland for the
Germanization of that province were in this way assisted by the
Prussian government, and in some parts of Germany the same means have
been employed for the purpose of aiding in the process of breaking up
large estates into small holdings, in the construction of dikes,
roads, and reservoirs, and in changing the courses of streams.

Next to the Landschaften the most important intermediaries between
capitalists and investors in real estate in Germany are the so-called
Hypothekenaktienbanken, or joint-stock mortgage banks. These are
private corporations, capitalized by the sale of stock shares to the
general public, and controlled by their stockholders through
directorates, like industrial corporations the world over. Their
business is the making of long-period loans on real estate security,
and the funds thus employed are obtained by the sale of mortgage bonds
secured by the real estate mortgages in which the proceeds are
invested and by their own capital, surplus, and other funds.

They differ from the Landschaften in that they are not cooperative or
mutual institutions, but strictly business enterprises run in the
interests of their stockholders. Their primary aim is to earn
dividends rather than to secure the lowest possible loan rates and
other favorable terms for borrowers. As a matter of fact they are
forced by competition and by the principles of good business to make
loans at reasonable rates and on favorable terms regarding repayment
and other matters, and they successfully compete with the Landschaften
and other cooperative credit institutions of Germany. Their mortgage
loans are usually made repayable on the annuity plan, one-half per
cent each year being the common rate of payment, and they loan about
the same percentage of the value of the lands mortgaged, as do the
Landschaften and other land banks, and the rate of interest charged is
the market rate, into the determination of which, of course, the
competition of all other institutions enter.

While these institutions loan in the aggregate enormous sums on farm
property, their chief field of operations is urban real estate, and
particularly the industry of residence, or as we would call it in this
country, apartment-house construction. It is on this account that the
period of their most rapid development coincides with that o