The Collector -- Decades Sam Israel Bought Cheap And Never Sold. Today His Legacy Means Change For Seattle.

IN THE UPPER FIVE floors of the old Corona Hotel, where no one has bunked for more than 30 years, Sam Israel's legacy looks like stalactites of peeling ceiling paint, piles of sinks ripped from their moorings, a haze of ground plaster and brick dust.

The immigrant shoemaker turned bargain-real-estate tycoon bought the closed hotel on the north end of Pioneer Square for $95,000 in 1970 and tucked it away as he did so many other buildings. He wasn't going to open it. He never even went inside.

He was a collector, not a developer or a seller. He wanted the land more than the building and security more than money. He felt property - the earth, bricks and mortar - protected him like a fort from inflation, the government and anti-Semitism. Bank accounts, stocks and bonds struck him as flimsy as sheets on a clothesline.

"Jews couldn't buy land for many years," he once said in his high-pitched voice. "By nature, Jews protect themselves. It was a curse of God that they should be strangers in every land but the promised land."

When he died in 1994, at age 95, Israel had collected more than 500 properties, from the last undeveloped waterfront homesite on northwest Mercer Island's Faben Point to Eastern Washington wheat and potato fields, orchards and scablands. He owned timber stands and land surrounding lakes, including Soap Lake, where he lived from 1961 until he suffered a stroke in 1989. He controlled much of main-street Ephrata, a single lot in a Snohomish County subdivision, tracts from Blaine to the Olympic Peninsula to Vashon Island, a house in Ballard, lots in the state's smallest town of Krupp, warehouses, parking lots.

More than 40 properties were in Seattle and 14 in Pioneer Square, where Israel exerted influence for decades by what he wouldn't or couldn't do. His buildings were turn-of-the-century brick gems that sat neglected between their roofs, which he kept repaired, and their bottom retail floors, which he rented cheap.

The low rent helped small businesses survive. Artists moved into some of the buildings. But Israel riled city officials, developers and housing advocates who shamed, cited and sued him. He complained they were picking on him and was determined to move at his schedule, not theirs.

Now, five years after his death, Israel is still calling the shots. He left behind the Samis Foundation, stocking it with his massive, debt-free real-estate portfolio and steering it through a hand-picked board of volunteer trustees - realtors, lawyers, bankers, accountants and a rabbi. He left instructions that the charity be self-sustaining and as perpetual as possible. He gave it a goal nothing short of preserving Judaism.

His properties are being resurrected into housing, parking, office and retail space, with every rent and fee check going to the causes he cared about.

By early next year the Corona, wedged mid-block on Second Avenue between James and Cherry, should be 20 middle-income, loft-style apartments. The grand but dormant Terry-Denny Building near First and Yesler will hold 48 more. The sawed-off Butler Block Building across from the Corona will become a 460-space parking garage. Nearby, the empty Collins will be renovated into an office building. The vacant old Pioneer Square Theatre next door will become office or retail. The Smith Tower, which the foundation bought and renovated, anchors it all. And this is only the initial phase.

The foundation's annual $2 million in donations figures to multiply several times as Israel's old-world collection awakens. Buildings that don't fit the plan are being sold - a little nervously.

"There are times when we're discussing selling a building and wonder if Sam is watching," says his nephew and foundation president Eddie Hasson, "and whether selling it will somehow run us afoul with him. Sam didn't like to sell buildings."

BY THE TIME ISRAEL bought the Corona he was 71 and entrenched on his Soap Lake ranch. He lived in a tiny home, little more than a shack, and lived off his rent checks and Social Security payments. He still bought property, combing tax sales and using the phone to keep tabs on Seattle.

He began buying in the 1930s, using the stake earned making and repairing shoes, a trade he learned on the Aegean Isle of Rhodes. His family was one of many from the Sephardic Jewish community who left there for America, looking for opportunity. His father, a cigarette-paper merchant, lost much of his wealth when the lira collapsed, an event that forever shaped Sam's attitude toward currency.

Arriving in Seattle in 1919 at age 20, he went to work for a Greek shoemaker. Israel had the hands of a craftsman but the mind of an entrepreneur and set up his own shop after a few years.

He prospered and scored a lucrative boot-repair contract with the U.S. Army during World War II. Although he claimed to net only about 20 cents a pair, volume was everything and the business helped him leave footwear and focus full time on real estate after the war.

By then, he had already bought several buildings around town - in Belltown, for example, the Austin Bell, for $9,800, and the Douglas Hotel, for $16,000. The foundation has sold each for $1 million. Israel paid less than $5,000 for a corner lot at 90th and Aurora where a Taco Bell now sits.

Hiking around Mercer Island one day he saw a sign advertising waterfront lots being sold cheap at auction and wound up with two acres. He lived there until 1961. His boarded-up house still sits on the overgrown lot, surrounded by expensive homes, and a developer holds an option to buy it from the foundation for millions.

Israel looked to amass concentrations. The size of the down payment was more important than the price. He bought with cash or on contract and was keen on estate sales.

He focused on Pioneer Square during the 1940s, when it was still considered Skid Road, a neighborhood of rundown buildings, flophouses and rough taverns. He bought the Hartford, Drexel, Yesler, Washington Shoe, U.S. Rubber and Schwabacher buildings for an average of about $55,000. Although he was convinced the area would thrive again some day, he never did anything to prod it along. Other than the caring for the roofs, he did and spent as little as possible.

There were days long ago when Israel was a man about town, wearing custom shoes and shirts, playing banjo in a band, scaling Mount Rainier twice, drumming up support for a statue of Seattle pioneer and mayor Henry Yesler. He made headlines in 1942 when he donated six tons of heels collected through his repair business to a wartime rubber drive.

He was known as an honest man who had a hard time trusting; but if he did trust you, a handshake was good enough. After moving to Soap Lake he returned to Seattle only a few times and only when he had to. Once, it was to attend a court hearing to make official a land swap he wrote out on a piece of notebook paper.

Israel bought lot after lot in Grant County. People there debated whether he was miserly or generous, but just about everyone called him eccentric. He drove around in a dusty Jeep with an overturned milk crate as the passenger seat. His ranch along Soap Lake was lined with rusting heavy equipment and populated by stray dogs he adopted.

He built a camp for Boy Scouts on his property, opened bank accounts for kids, lectured at schools and churches on Judaism. When an Ephrata Methodist church built a new church, he bought a bell for its tower.

Yet his downtown Ephrata buildings mainly sat empty and when one was gutted by fire, he refused to tear it down. Instead, he surrounded the charred hulk with a big plywood fence painted blue and white, the colors of the Israeli flag. It stayed that way for more than a decade. Accounts differ, but he was either angered by what he took as an anti-Semitic comment from a city official or by the volunteer fire department's refusal to break into the building to fight the fire.

Soon after Israel's funeral the Samis Foundation tore down what was left of the building and allowed a service group to build a landscaped parking lot there.

THE 1903 CORONA IS JUST one jewel in a trove of historic brick buildings erected in Pioneer Square after the Great Fire of 1889 swept through, leveling the original wooden ones. It was an office building until about 1920, when it became a cheap hotel where boarders could stay a night, weeks or months.

From time to time, Israel talked about replacing some of his old buildings with high-rises, but he never came close to doing it. Ultimately, his mothballing ways helped save many turn-of-the-century brick structures long enough for preservation laws to be enacted in the early 1970s.

Seattle architect Ralph Anderson, whose early work and investment helped spark the area's transformation, believes he is the only person ever to buy a building there from Israel. After Anderson refurbished a building at First and Jackson he asked Israel to sell him the nearby Union Trust Building.

Israel was known to end conversations with buyers by slamming down the phone, but he quickly accepted Anderson's offer. The men never met and Anderson, who wound up restoring about nine Pioneer Square buildings, says he doesn't know why Israel said yes.

Israel's former property agent, Jim Horrigan, recalls him selling only one other building, several blocks north of Pioneer Square. In that case, the buyer renovated and then re-sold the building for a hefty profit.

"Sam never let me forget about that," Horrigan says.

As Pioneer Square eventually blossomed, Israel went from being regarded as an accidental preservationist to an obstacle whose unkempt buildings discouraged development of surrounding ones.

Now it's up to the Samis Land Co., which manages and develops property for the Samis Foundation, to transform the buildings to 21st-century use while maintaining 19th-century form and blending into a neighborhood where art galleries coexist with shelters for the homeless.

The margin for disagreement can be as slim as the two rickety and obsolete fire escapes hanging on the alley side of the Corona. Samis and a Seattle police crime-prevention officer who studied the site said the fire escapes created safety and security threats for future tenants of the planned apartment complex. Intruders use them. People can fall off them.

The Pioneer Square Preservation Board, though, ruled the alley fire escapes were "character-defining" and had to be kept. Samis finally won the right to remove them when a city hearing examiner found the board and director of neighborhoods ignored safety issues and the district's priority on housing.

Details like fire escapes would have sent Israel ranting, but the man handling the portfolio now is William Justen, a well-connected developer and former director of the city's Department of Construction and Land Use whom the foundation hired a few years ago.

While Israel was short, stout, excitable and intolerant of anything bureaucratic, Justen is tall, slim, sedate and familiar with the nuances of building codes, historical renovation and political terrain. He has handled several major projects, from converting Lake Union's steam plant into the ZymoGenetics research lab to helping restore Pike Place Market.

A few months before the fire-escape tussle, the preservation board tried to prevent Samis from demolishing one of three existing floors of the Butler Block Building that will eventually serve as the base for a 100-foot-tall parking structure. Samis appealed and won that one, too, claiming the board's decision threatened the project by raising the cost by about $800,000.

In both preservation cases, Samis' clout came from providing what the neighborhood lists as priorities. The Corona and the Terry-Denny buildings alone, for instance, will add 68 middle-class apartments to a neighborhood that has only about 100 now.

While the initial wave of renovation focuses on essentially empty buildings, some people there find Samis' actions more unsettling than Israel's inaction. Preservationists are concerned about protecting the area's charm. Small-business owners and artists fear escalating prices for space. Advocates for the large population of homeless and low-income residents wonder if a fuller, more gentrified Pioneer Square will become a significantly less tolerant one.

Some of them miss old Sam.

NEAR THE END of his life, Israel was no longer the old Sam with the amazing head for numbers and memory for buildings. He spent his last years in a Seward Park nursing home after suffering a stroke in 1989 that caused a series of complications. He kept asking Hasson and other relatives when he was going to Israel, where he imagined himself tending a garden.

Then one day, a property agent walked into the nursing home and talked Israel into signing an earnest agreement to sell his waterfront Mercer Island property. Hasson and the other relatives stopped the sale and had Israel ruled incompetent to protect his assets, estimated then at roughly $100 million.

Those who knew him knew that Israel hadn't been planning to sell off the estate he spent his life amassing. Since the 1970s, after making sure his sister, Bona, was taken care of, he had been making plans for his charity.

Seattle businessman Eli Almo was one of many future trustees who traveled to Soap Lake so Israel could assess their commitment.

"He was very interested on my perspective on Jewish education and what Israel meant to me," recalled Almo, who directs the Samis Foundation property committee. "My background in real-estate development and financing were important. He knew what he was doing and what he wanted."

Prominent attorney Irwin Treiger and developer Martin Selig sit on the Samis board. Four of the 16 trustees are Israel's nephews. All have lifetime membership and must be Jewish. In his will, Israel required that the board always include a rabbi whose job would be to make sure the spirit of the will was followed.

To emphasize the commitment he expected, Israel told trustees through his will, "For the past 2,000 years some of our devoted Hebrews have let themselves be burned alive for the preservation of our people. . . . We are our brother's keeper."

Charities usually sell and convert property into simpler securities. But the foundation plans to keep and develop the valuable parts of Israel's portfolio because he wanted it to last as long as possible.

The will directs the foundation to consider building a museum in Israel someday and to help Jews who want to re-settle in Israel (but not anywhere else). He wanted archaeology and wildlife causes in Israel funded. The foundation has committed $1 million to a bird research center there.

More than 85 percent of Samis' yearly grants go to local education. Israel had little schooling, but people in Grant County say if he liked you he would do two things: advise you to buy land and lecture on Jewish history and religion.

For the past three years the foundation has reduced annual student tuition at the Northwest Yeshiva High School from $7,000 to $3,000 and enrollment has risen from 58 to 78.

The academic record of the Mercer Island school is among the best in the state. Its core curriculum, though, is Judaic studies: While advanced students argue over interpretations of the Talmud a teacher down the hall will toss out references to movies like "Raiders of the Lost Ark" and "Prince of Egypt" to engage beginners.

The connection between the school and Samis actually began more than 20 years ago, when Rabbi Daniel Rosenthal was trying to start the only Jewish high school in the Northwest. He had never met Israel but sent a hand-written letter to Soap Lake, seeking a donation. At the time, the school was little more than an idea, with little money, no office or equipment. Israel promptly sent back a check - along with word he was particularly impressed the fledgling project hadn't wasted money on a typewriter.

It was the same basic logic with the old Corona Hotel: Stay focused on the goal, don't waste money on niceties, build the collection.

"Instead of spending money developing his properties he used it to buy more property," said Victor Alhadeff, chair and CEO of the Briazz deli chain and a Samis trustee. "Then he put together a charity to help causes important to him and staffed it with business people who get paid nothing. I think Sam was smarter than all of us."

Richard Seven is a staff writer for Pacific Northwest magazine. Harley Soltes is the magazine's staff photographer. Historical photos courtesy of Eddie Hasson, Samis Foundation.