Harvard Business School -8- Our affiliate, the Marcona Mining Company, exclusive of any shipping activities, is today larger than the Utah Construction Company was in 1949 The Peruvian venture in less than 4 years has achieved a size and profitability greater than Utah could establish in the first 50 years of its corporate life. Our activities in the field of land development and land purchased for resale again indicate the gradual evolution of an idea. We started out conventionally enough during the Korean War, building Wherry Act housing projects and Critical Housing projects under the government program. When the government program was no longer of interest, we had an organization that was naturally seeking ways to keep profitably employed. They began to explore the possibilities of large-scale land purchases and development and this ultimately lead to the purchase of 5,000 acres of land in the Moraga Valley. In 1951 we had entered into a purchase agreement to buy 868 acres of tidelands off of Alameda known as Bay Farm Island but had set this land aside because of the construction freeze imposed by the Korean War. In 1953 the project was revived, and an economic study made, which lead us to the conclusion that we should undertake the development of this area and an additional 388 acres which we purchased immediately adjacent to Alameda as a residential and commercial area. This put us into the land manufacturing business, a business which we plan to pursue. Most investors buy land with the hope that the land will increase in value, either because they bought it below the market or because the market price of the land will increase in response to economic factors. Our approach differs in that we are trying not to depend upon the accurate prediction of the market price for land but rather to buy land which is relatively worthless in its present form and to which we can add value by the performing of construction service, thereby creating economic gain beyond the cost of performing the work. For example, we are interested in a project in South San Francisco where we have 80 acres of hilly land behind the Bethlehem Steel plant and 204 acres of marsh land west of the airport. By removing the hill from the 80 acres and spreading