The Cal Beta Chapter of Chapter of
Sigma Alpha Epsilon
Berkeley, California
Back in 1976, brother Dr. Herb Dedo ’52 started taking his young son to Cal football games. When he stopped by the chapter house, he was surprised to learn that years before, back in the days of Mario Savio and the Berkeley Free Speech Movement, SAE Cal Beta had been reduced to fewer than 10 actives and had been forced to sell the house to Professor Judson Landis who taught Home Economics 113 at Cal.
The sales contract gave Cal Beta the right to rent the house and to have the first right of refusal should it be sold. Professor Landis put the house on the market in late-1976 and filed papers with the court to evict the actives and attempt to repossess the house.
Brother Dedo learned about this, and immediately decided that Cal Beta should attempt to buy back the chapter house which would require substantial funds from the alumni. He first contacted Mike Friedenbach ’50 and the two of them agreed to contribute $10,000 each towards the re-purchase. Brother Dedo then called Bill MacLaughlin ’49 who along with Al Bender ’51 and Ed Lippstreu ’49 also agreed to contribute an additional $10,000 each. Brother Dedo then recruited Jim Riewerts ’51, Bob Conn ’43 and J.C. Armstrong ’39 who combined to pledge another $10,000.
The Cal Beta Investor group then hired an attorney who went to court to fight the repossession and to have the property appraised. The third-party appraisal came in at approximately $500,000. Professor Landis brought in a “straw man” who indicated he would pay an amount in excess of $500,000 for the property. The Investors’ attorney questioned the legitimacy of the straw man in court in front of the judge. It was subsequently determined that the straw man was the manager of one of Professor Landis’ apartment houses and had no money to buy the property. This very much displeased the judge and he gave the Cal Beta Investor group 30 days to come up with the funds to buy the property. In addition, the judge reduced the sale price of the house in consideration of all the work that had been done by the chapter since Professor Landis had acquired the property.
The Cal Beta Investors agreed to guarantee a $240,000, 20-year mortgage from Sacramento Savings & Loan arranged by Bill MacLaughlin. But this amount plus the equity from the Investors still didn’t cover the entire amount necessary to purchase the house. Brother Dedo started calling all the Cal Beta alums he knew requesting contributions. He recalls that he ran up over $900 in phone bills. (Remember this was before the Internet). He received the final $3,600 just hours before the deadline.
Closing escrow was fairly complicated as Professor Landis required that the transaction be handled as an exchange for a property in Sacramento that could be inherited by his son who was a professor at Sacramento State University. After numerous meetings with Professor Landis and his son, Bill MacLaughlin was able to find a medical building that was acceptable and escrow was closed. The Cal Beta Investors now owned the land and building at 2722 Bancroft Way.
Many complicated hours and trips to the Bay Area were involved with this transaction and none of the Investors were reimbursed for their time or out of pocket expenses. All of them performed above and beyond the call of duty — all for the sake of their love of SAE Cal Beta. A lease was written between the Investors and the Cal Beta Chapter and the monthly rent was equal to the mortgage payments plus a reserve for property taxes and insurance. No profits were made by any of the Investors in this transaction.
In the late 1980s and early 1990s the Cal Beta House Corporation set up a non-profit corporation — Cal Beta SAE Educational Institute, Inc. Brother Phil Knox ’41 of the House Corporation then negotiated with the Investors to acquire their ownership of the chapter house. Brothers Dedo and Friedenbach donated their interest to the Institute and the other investors were reimbursed for their original equity contributions. A new mortgage was obtained by the Institute which retired the Sacramento Savings & Loan mortgage that the Investors had personally guaranteed.
Cal Beta is very fortunate that the above named Investors came to our rescue during this crisis. Had they not acted when they did, it is very probable that 2722 Bancroft Way would be owned today by the University or another private investor group and SAE Cal Beta would have been forced to find another home.
We are delighted to induct each of the Cal Beta Investors of the 70s into the Cal Beta Sigma Alpha Epsilon Andy Smith Hall of Fame.
