FEBRUARY 1980 - VOLUME 1 - NUMBER 1
Land Grab In the Works
Multinational businessmen ordinarily see the United States as second to none in providing a secure home for foreign capital. A startling decision by the Attorney General of Oklahoma, however, may lead some corporate executives to think twice about that image.
Jan Eric Cartwright recently declared that Oklahoma's 1907 constitution prohibits foreign corporations from owning land or buildings in the state. And on November 14 he began enforcing the ruling. Cartwright notified Oklahoma's largest foreign investor. Hillcrest Investments Ltd. of Calgary, Canada, that unless it sold its property, he would expropriate the holdings.
The Cartwright opinion, handed down September 12, directly affects 45 companies with investments totaling $540 million. Hillcrest's holdings stand at $150 million, and include office buildings and an apartment complex.
To Oklahomans, the issue of foreign investment in real estate is more than a constitutional one. State legislators claim that foreign speculators arc wreaking havoc with land prices, and not contributing to economic development in the state. Cartwright agrees. In a report to the legislature last May, he labeled such investment as an "extractive type of ownership, not investment ownership, investing in jobs or anything else."
Cartwright's ruling is a manifestation of growing popular dissatisfaction with the impact of foreign corporate activity in the U.S. Recently, for example, Iowa became the ninth state to prohibit non-U.S. companies from owning agricultural land.
Despite forceful utterances from the Attorney General's office, it may be a while before the state takes any action against foreign companies. On December 11, a Federal District Court judge granted Hillcrest's request to bar Cartwright from carrying out his ultimatum. The Oklahoma Chamber of Commerce and Oklahomans for Economic Progress, a pro-business group, are challenging the opinion on constitutional grounds. Richard Lesher, president of the U.S. Chamber, warned at a recent press conference that Cartwright's decision , has "dangerously undermined America's open-door economic policy."
Hillcrest vice-president Douglas Fast is mystified by Cartwright's ruling. "Hillcrest's program has been to renovate and improve property. We are here for the long-term," Fast explained. "We are not land speculators. We've never milked a project." Fast's dismay may be attributable to another fact as well: it seems Hillcrest first invested in the state two years ago, after receiving promotional literature from the Oklahoma Industrial Development Department.