#1 – Donald Bren
Chairman
Irvine Company
Estimated worth: $13 billion
An active year of residential development, office buys and construction, as well as signs of improvement across different sectors of the real estate market, added to our estimated wealth of Donald Bren this year.
The Business Journal estimates Bren, chairman of Newport Beach-based Irvine Company, to be worth $13 billion this year, up from $12.5 billion a year ago. We believe our estimate remains conservative.
Bren remains the wealthiest resident Orange County has ever seen, as well as the wealthiest real estate owner in the U.S.
Irvine Co.’s real estate portfolio totals close to 96 million square feet, including nearly 500 offices, more than 40 retail centers, 116 apartments communities with nearly 45,000 units, five marinas, three golf clubs, two hotels and the Resort at Pelican Hill.
The company’s holdings in OC include large parts of the 5,000-acre Irvine Spectrum, Fashion Island, Newport Center, half of Irvine’s 185-acre University Research Park, Jamboree Center and MacArthur Court.
Irvine Co. also has sizable stakes in San Diego, Silicon Valley and Los Angeles. It recently bought the 247,000-square-foot Western Asset Plaza in Pasadena. The company’s only property outside of California is the 48-story Hyatt Center office tower in Chicago.
The company also is estimated to own 27,000 acres, about half of which probably is developable. The land could accommodate close to 20,000 lots for homes after taking streets, parks and other uses into account.
The Irvine Ranch remains Southern California’s most active source of new home development, much of it headed up by the company’s affiliate homebuilding division, Irvine Pacific. Other builders, such as KB Home, are buying land from the company for projects at developments including Portola Springs. The land typically sells for about $3 million per net buildable acre, according to sources familiar with the company’s land sales.
Bren has made the company’s investment portfolio—and its balance sheet—the envy of the real estate industry. Sources peg Irvine Co.’s debt level at about 40% or less of the company’s entire portfolio, on the low side for the industry.
Irvine Co. has an “A” credit rating and stable outlook from Fitch Ratings Inc., confirming its relatively low debt.
The company is said to generate sizable annual cash flow, even during tougher times. The Business Journal estimated Irvine Co. generated about $2.2 billion in revenue last year.
Part of that cash now looks to be going to the company’s active apartment division, based on the level of Irvine Co. development seen in OC and elsewhere over the past year.
The company has at least 4,000 apartments in construction, and more in early-stage development in OC, including its Cypress Village project and other development around the Irvine Spectrum and Newport Beach, among other locations.
Irvine Co. has apartment projects in progress in Silicon Valley, where it has also been buying and building office centers. The company also has made recent office buys in San Diego.
Bren got his start as a homebuilder in 1958. In 1977, he was part of a group that acquired control of Irvine Co., the successor to the massive ranch bought by James Irvine in 1864.
Bren bought out many of his partners for $518 million in 1983. In 1991, he paid $256 million to heiresses Joan Irvine Smith and her mother, Athalie Clarke, for their shares. Bren became Irvine Co.’s sole owner in 1996.
Immense wealth has brought about sizable giving by Bren. Bloomberg Businessweek ranked him one of the nation’s most generous philanthropists, estimating his lifetime giving at more than $1.3 billion. More than $265 million of that giving has been for education. He’s directed more than $70 million to the University of California, Irvine, among other Southern California schools.
Bren also has set aside 50,000-plus acres of land—more than half of the 93,000-acre Irvine Ranch—as open space and parklands in perpetuity. The lands are formally designated as Natural Landmarks by the U.S. Department of the Interior and the State of California.
—Mark Mueller
#2 – Igor Olenicoff
Owner, founder, president
Olen Properties Corp.
Estimated worth: $2.75 billion
Olen Properties is Orange County’s second-largest owner of office and industrial buildings, and new insights and an increase in the value we’ve assigned to the real estate owner’s sizable apartment portfolio helped push our valuation for Igor Olenicoff up by $250 million this year.
The $2.75 billion estimate is the highest yet for the longtime list member, whose family fled Soviet Moscow and land-ed in America, by way of Iran, in 1957. He started Olen in 1973.
The update puts the Business Journal’s estimate ahead of Forbes, which gave Olenicoff a smaller bump in its March ranking of the world’s billionaires.
Forbes estimates Olenicoff, who has homes here and in Florida, to be the ninth-richest real estate businessman in America.
Our figure for Olenicoff remains conservative, along with many of the rest of our estimates for this list.
Input from sources familiar with Olenicoff led us to estimate his real estate portfolio to be in excess of $4 billion, with a debt level that’s said to be well below many other property owners.
Olen Properties owns more than 7 million square feet of office and industrial space, much of it in Orange County. The company is believed to be the biggest office landlord here besides Irvine Co. (see related entry No. 1).
A large portion of Olen’s office portfolio is made up of low- and midrise business parks, in keeping with the company’s last two reported acquisitions: a Santa Ana business park that was bought for $24.5 million earlier this year and a Mission Viejo business park that Olen paid a reported $18.8 million for late last year.
“[It] is not that we are becoming any more active buyers,” Olenicoff said in an email. “It is just that we are finding that there are more deals around that make sense financially.”
Olen also owns more than 10,000 apartments, primarily in Las Vegas and Florida, with another 500 or so in OC and Arizona. Many of those apartments have been debt-free for years.
The continued appreciation of apartment properties here and across the country—plus new development Olen has under way in Florida—likely increased the value of that portfolio by $150 million last year, if not more.
Other Olen assets include marinas, airport hangars, a golf course, and restaurants, including Andrei’s in Irvine, named in honor of his late son.
The square footage of Olen’s total commercial real estate portfolio likely runs close to 20 million square feet altogether, including apartments.
Other sources of wealth for Olenicoff include stocks, loans he’s made and cash holdings, according to sources.
—Mark Mueller
#3 – David Sun
Cofounder, chief operating officer
Kingston Technology Co.
Estimated worth: $2.6 billion
#3 – John Tu
Cofounder, president
Kingston Technology Co.
Estimated worth: $2.6 billion
Kingston Technology is fighting an industrywide sales slump, but that hasn’t deterred the Fountain Valley-based company from betting on future demand with David Sun and John Tu at the helm.
Kingston remains the world’s biggest maker of memory products for computers and consumer electronics, and it recently spent more than $130 million to get majority stakes in two Taiwanese memory storage makers in an effort to shore up its supply chain as it enters newer markets.
A big price drop in memory products and components bumped Kingston off the top perch in our annual list of largest private companies in Orange County published earlier this year. The Business Journal estimates Kingston had sales of $5.8 billion in 2011. That’s down 11% from a record $6.5 billion posted in 2010 amid a global surge in sales of DRAM products, the most common type of memory used in computers and King-ston’s biggest source of revenue.
The declining prices for memory product components have hit Kingston’s top line but also opened up new opportunities in the consumer and corporate markets. The drop in the average sale price for DRAM has made solid-state drives more affordable for the mass market. Kingston is seeing an influx of consumers buying its solid-state drives to improve computer performance, which allows them to stream more content, improve video game play and store other data. Kingston also is making gains in the embedded-storage market for servers as more corporate customers look to the cloud to meet storage needs.
Sun and Tu are estimated to own the vast majority of the company, and both also have other investments.
We’ve pegged them at $2.6 billion each this year, down from $2.75 billion a year ago. Our estimate is based in part on Kingston’s revenue projection, falling prices for its memory products, and comparisons to publicly traded rivals. It also takes into consideration the recent investments in Taiwan, which have yet to bear fruit.
Fortune came to Sun and Tu after they built Kingston and then sold 80% to Japan-based Softbank Corp. for $1.5 billion in 1996. They bought it back at a steep discount three years later.
Both men are on their second fortunes. They founded memory products maker Camintonn in the 1980s and sold it to former Irvine computer maker AST Research Inc.
They left AST to start Kingston after losing millions in Camintonn proceeds in the 1987 stock market crash.
Sun and Tu are known for their generosity. They made headlines in the 1990s when they handed out $100 million in bonuses to workers after selling their company to Softbank.
Kingston has put its name behind fundraising events by local nonprofits, including the Boys & Girls Clubs of Huntington Beach and Fountain Valley and the Juvenile Diabetes Research Foundation, which has a chapter in Irvine. Kingston’s British operations give to Vision Charity, which raises funds for blind and dyslectic children.
Sun has given to Taiwanese charities, the Presbyterian Church and education causes. Tu’s also has given to stem cell research, inspired in part by friend and AST cofounder Tom Yuen, a dialysis patient.
Tu and wife Mary have given $250,000 to PBS SoCal. He also has backed projects to help homeless children in Brazil.
Tu is the businessman and benefactor for a group of inner-city high school kids depicted in Erin Gruwell’s The Freedom Writers Diary, a book that was made into a movie.
Tu, originally from China, moved to the U.S. in 1972. He once worked as a cook in his uncle’s Chinese restaurant and as an apprentice welder while living in Germany as a young man.
Sun, who was born in Taiwan, came to the U.S. in 1977.
Sun and Tu are music devotees and keep local musicians in gigs with their company orchestra.
Tu jams with his own band, JT & California Dreamin’, which plays benefits.
—Chris Casacchia
#5 – William Gross
Cofounder, co-chief investment officer, managing director
Pacific Investment Management Co.
Estimated worth: $2.3 billion
William Gross had an up-and-down time over the past 12 months. He ended with a total net worth of $2.3 billion, up $100 million by our estimate.
It’s a comeback for the manager of the world’s largest bond fund, who spent a good deal of that time on a mea culpa over his ill-timed bet against U.S. Treasuries.
Gross sold off all U.S. bonds from Pimco’s Total Return Fund last year only to see investors scramble for U.S. government debt as a safe-haven amid the turbulent global economy.
The subsequent rise in bond prices left Gross’ fund trailing 90% of its peers for 2011, when it notched a 4.16% return compared with 7.84% for the benchmark Barclays Capital Aggregate Bond Index.
Gross issued a public mea culpa in October.
The comeback for the “Bond King” started during the first half of this year, when he restructured the fund, steadily adding Treasuries back into the mix and making a big play on mortgage-backed securities.
Bonds now account for 35% of the fund, with 52% in mortgage-backed securities, and the rest a mix of bonds from other developed countries, emerging-market debt, and investment-grade securities.
The moves helped draw $5.9 billion of new money through June 30, more than making up last year’s outflow of $4.97 billion and have some left over.
The Total Return Fund now has $263.4 billion in assets under management, its all-time high. Its 7.39% rate of return compared with the industry benchmark of 2.05% and puts it in the top 5% among peers so far this year.
Gross reportedly received $200 million in compensation last year, leading to a gain in our estimate of his net worth.
The next 12 months could see more gains, depending on how his investments in mortgage-backed securities fare, along with bonds.
He’s on record as viewing Treasuries, once again, as safe havens in the market. He’s also said that the Federal Reserve is likely to step in with further stimulus, a move he thinks could include purchases of mortgage-backed securities.
Gross also has scored some early success with the Pimco Total Return ETF, an exchange-traded fund version that started in March and is designed to match the performance of the mutual fund.
The ETF has gained more than 6% since inception, outpacing the growth of the bond fund, which saw a 4.2% return over the same period.
Pimco has been introducing a stream of exchange-traded funds since entering the market in 2008. Other ETFs include Global Advantage Inflation-Linked Bond Strategy Fund, Australia Bond Index Fund and Germany Bond Index Fund.
Some of Gross’ recent gifts include $10 million to the National Postal Museum in Washington, D.C., to create a new 12,000-square-foot gallery late last year.
The gallery is expected to be named for him, and is scheduled to open next year.
Gross is loaning the museum a selection of rare stamps from his own collection, and he donated much of the rest to Doctors Without Borders.
He and wife, Sue, gave $23.5 million to his alma mater, Duke University, in 2005. They also have given $10 million for the Sue and Bill Gross Stem Cell Research Center at University of California, Irvine, in 2006, $20 million to Hoag Memorial Hospital Presbyterian for its Women’s Pavilion bearing their names, and funded the James Hines Foundation, which contributes $100,000 annually to OC Teachers of the Year.
The couple lives in Laguna Beach and has a lot on Harbor Island that’s reportedly on the market for $26.5 million. They reportedly also bought Jennifer Aniston’s Beverly Hills estate for $37 million last year.
—Jane Yu
#6 – Henry Samueli
Cofounder, chairman, chief
technical officer
Broadcom Corp.
Estimated worth: $2.15 billion
Henry Samueli came full circle over the past year, with a return as chairman of the Irvine-based chipmaker Broadcom Corp. followed by a top industry honor—and his decision to sign Warren Buffett’s Giving Pledge in the mix.
The company’s cofounder and chief technology officer regained the chairmanship in May, marking the second time he has held the post in the last three years.
The move further distanced him from lengthy legal proceedings over backdated stock options in 2009.
Samueli, considered an engineering visionary and icon at Broadcom, is known as a mentor to the company’s engineering groups, and still maintains a leading role in high-level strategic and product development for chips that go into computers, smart phones and other consumer electronics.
Broadcom has amassed one of the industry’s largest portfolios of intellectual property, with more than 17,300 U.S. and foreign patents and applications.
Broadcom was the first chipmaker to sample the next generation 5G Wi-Fi chip earlier this year, which promises to extends battery life and triple the speed of data transfer. It also introduced full band capture, which allows users to simultaneously access different cable channels through various devices.
Samueli in June received the 2012 Marconi Society Prize and Fellowship, considered a top honor in the information- technology field for pioneering development and commercialization of analog and mixed signal circuits for cable modems and other communications applications.
In April he signed Bill Gates’ and Warren Buffett’s Giving Pledge, which aims to recruit the super wealthy to give a significant portion of their fortunes to philanthropic efforts.
We estimate Samueli’s wealth at $2.15 billion, down from $2.3 billion last year. That’s based largely on Broadcom’s stock slipping about 13% in the last 12 months.
Samueli’s 26.7 million Broadcom shares account for about half his wealth by our estimate.
He’s sold more than $1.2 billion in shares since the company went public in 1998, including about $50 million worth in the past year or so, but remains a dominant shareholder.
Samueli’s Anaheim Ducks had a tough year on the ice, finishing near the bottom of the Western Conference and missing out on the National Hockey League playoffs.
The Ducks generate an estimated $25 million in ticket sales per season to go with revenue from TV and radio rights, merchandise and other sources. They are generally thought to break even during good years and lose money during bad ones.
Samueli is a lifelong hockey fan, and he bought the team from Walt Disney Co. for $75 million in 2005.
He also owns the company that operates Honda Center, the Ducks’ home ice.
Honda Center is estimated to do about $50 million a year in ticket and concession sales, including concerts and other events.
Samueli and wife Susan also own part of KDOC-TV in Anaheim, which broadcasts Ducks games that aren’t scheduled by cable channel Fox Sports West.
The couple has given away more than $250 million in the past decade and is among the county’s top philanthropists.
Among their causes are the University of California’s Irvine and Los Angeles campuses, both of which named their engineering schools after Samueli.
The Samuelis have given more than $30 million altogether to UCLA, where Samueli earned three degrees, and $25 million or more to UCI.
A library at Chapman University in Orange is named for Samueli’s parents, Polish Jewish immigrants who survived Nazi Europe.
Susan is a big supporter of alternative medicine. UC Irvine’s Susan Samueli Center for Integrative Medicine is named for her.
The Samuelis also give to numerous nonprofits through their foundation, which focuses on healthcare, education, youth services and Jewish causes.
During the past 10 years, the Samueli Foundation has given 1,872 grants with $217 million in funding.
—Chris Casacchia
# 7 – James Jannard
Founder, chief executive
Red Digital Cinema Camera Co.
Estimated worth: $1.6 billion
The list of movies, TV shows or magazine covers shot on cameras made by Jim Jannard’s Red Digital Cinema Camera Co. continues to grow.
So does the list of charities getting a hand from the maverick entrepreneur. Jannard recently said he has a new goal to divest his wealth and has given half away to charity over the last year—donations that apparently have been made on the condition of anony-mity.
We’ve credited Jannard with a gain from the increased value of Red Digital over the last year, which raised our estimate by about $100 million from last year, to $3.2 billion. Then we cut that in half based on his busy year of giving.
Jannard’s increased philanthropy comes as his venture, Irvine-based Red.com Inc., continues to make strides in Hollywood, where its digital cameras have compiled a list of credits that includes movies such as Prometheus, The Amazing Spider-Man, The Girl With the Dragon Tattoo and Total Recall. More are in the works, including The Great Gatsby, Oz the Great and Powerful, and The Hobbit.
The company has introduced three cameras to the market since its launch in 2006. It also owns a working movie studio called Red Studios Hollywood.
Jannard also has the company moving into computers, with a model called the HP z820 RED Edition now available to pro cinematographers and photographers. Red partnered with Palo Alto-based Hewlett-Packard Co., Adobe Systems Inc. in San Jose and NVIDIA Corp. of Santa Clara on the computer.
A large portion of Jannard’s wealth comes from the sale of his 64% stake in Foothill Ranch-based Oakley Inc., the company he started in 1975 and sold to Italy-based Luxottica Group SPA for $2.1 billion in 2007.
Jannard, who holds the chief mad scientist and visionary title at Oakley, is believed to have Luxottica stock.
He also holds a number of patents for inventions at both Oakley and Red Digital.
Treasury bonds and other stock investments also add to his estimated wealth.
—Kari Hamanaka
# 8 – Henry Nicholas
Cofounder, Broadcom Corp.
Estimated worth: $1.5 billion
Henry Nicholas devotes most of his time these days to working on behalf of victim rights and helping disadvantaged high school students in Santa Ana get accepted and receive scholarships to prestigious colleges and universities around the country.
The Broadcom Corp. cofounder was given the Key to Santa Ana in July, along with retired Judge Jack Mandel, for their dedication to the community through the Nicholas Academic Centers.
The late Renée Segerstrom, a patron of the arts in Orange County, philanthropist and wife of pioneer businessman Henry Segerstrom, was the last honoree to receive the designation more than decade ago.
The center has graduated 232 students since its inception in 2008 with a 100% college enrollment rate.
“I am very committed to seeing the change in kids’ lives,” Nicholas said. “I’m so enormously proud of them. They’re the ones who deserve the award.”
Graduating students have earned $2.7 million in scholarships to date, and more than $600,000 in funding from the center.
Nicholas also dedicates much of his time to victims’ rights, which struck a personal chord after his sister’s murder decades ago.
He was a driving force in efforts to stop Proposition 66, a statewide referendum that aimed to weaken the three-strikes law, a proposal many victims’ right advocates saw as watering it down.
Now he’s working with the Illinois Legislature to implement Marsy’s Law, victims’ rights legislation named for his sister and passed in California in 2008.
“We went from having no protection for crime victims to having the most comprehensive in the nation,” Nicholas said.
Nicholas is pushing for similar legislation to be on the ballot in Illinois in November.
“I never thought I would be involved in politics, but I’ve had to by necessity,” he said. “I’ve seen entire families victimized by the criminal-justice system.”
Nicholas has made big strides to repair an image tarnished by a lengthy legal battle over accusations of stock-option backdating and a reputation for hard partying.
Nicholas for the last two years has not sold shares of Broadcom, which makes communication chips that go into computers, mobile phones and consumer electronics. He’s sold an estimated $1.2 billion in shares since the company went public in 1998.
Nicholas is the trustee of the Nicholas Broadcom Trust. The trust holds about 26.2 million Broadcom shares with a recent market value of about $870 million. We estimate his wealth at $1.51 billion, down from $1.6 billion from a year ago. Most of the drop was attributed to Broadcom shares losing about 13.5% in the last 12 months and his continued charitable giving.
He has given to the engineering and computer science programs at the University of California, Irvine, where he established the Nicholas Prize research grants.
Nicholas also gives to Pacific Symphony, Habitat for Humanity, the Episcopal Diocese of Los Angeles and the Oakland Military Institute, among others.
—Chris Casacchia
# 8 – George Argyros
Owner, chairman, chief executive
Arnel & Affiliates
Limited partner, Westar Capital LLC
Estimated worth: $1.5 billion
The strong apartment market, particularly in Orange County, gave a boost to our estimate on the bottom line of George Argyros, one of OC’s richest real estate owners.
We’ve estimated Argyros at $1.5 billion this year, up from $1.3 billion a year ago. A portion of the increase is due to the rising value in his real estate portfolio over the past year, and it’s partly a reflection on our part that prior valua-tions of the self-made billionaire were likely low.
Argyros owns Costa Mesa-based Arnel & Affiliates, a devel- opment and investment company he started in 1968.
Arnel has close to 5,500 apartments and some 2 million square feet of office, industrial and retail space in and around Orange County.
Conservatively factoring in debt—and factoring in a likely boost to the value of his apartment holdings of 15% or more over the past year, due to lower cap rates and higher rents—the Business Journal estimates Argyros’ wealth from real estate to be worth close to $900 million.
The former Ambassador to Spain and owner of the Seattle Mariners also counts a large stock portfolio, in addition to other investments. He’s the largest individual investor in DST Systems Inc., a Kansas City, Mo.-based software company that counts a market value of nearly $2.3 billion. Argyros’ 21.7% stake in the company is now worth about $500 million, about the same as it was a year ago.
DST is an early investment of Costa Mesa-based Westar Capital LLC, Argyros’ investment firm.
Argyros also counts a small stake in Santa Ana-based First American Financial Corp., as well as Costa Mesa-based Pacific Mercantile Bancorp, where he’s a director of the bank holding company.
Argyros is a major contributor to Chapman University, where the business school, student center and Argyros Forum bear his name. He’s also given to Performing Arts Center, supported college scholarships to Horatio Alger Association of Young Scholars (designated for Southern Californians) and serves on numerous local, national boards.
He was named earlier this year to “Founder’s Circle” of Regents for the OC Council of the Boy Scouts of America.
—Mark Mueller
# 10 -Paul Merage
Chairman, MIG Capital LLC
Estimated worth: $1.05 billion
Paul Merage and his brother, David, founded Colorado-based Chef America Inc. in 1975, and the company became known for its Hot Pockets brand of microwaveable food.
They sold to Nestlé SA for $2.6 billion in 2002, and our estimate for his wealth in based largely on the deal, after factoring in the stake of his brother (who lives primarily in Colorado), as well as any other ownership stakes, debt and taxes.
Our estimate is likely still conservative. Merage was rich before selling Chef America and could be worth much more.
His Newport Beach-based family investment firm MIG Capital (Merage Investment Group) and affiliates MIG Absolute Return, MIG Real Estate (formerly Stoneridge Capital Partners) and MIG Private Equity, collectively manage more than $1 billion in assets.
Last year he joined the ranks of billionaires, based on a strong run for stocks and bonds over the prior 12 months. We’ve taken him up slightly this year, considering the modest increase over the past 12 months of stocks and other assets classes.
MIG Real Estate plans to get busier in coming months. It’s out to buy up to $600 million in properties to go with the $400 million it already owns in California, Wyoming, Phoenix, Las Vegas, Seattle, Hawaii, Denver and Canada.
A good chunk of Merage’s time is spent giving away money through the Merage Foundations.
The Merage Foundation for the American Dream focuses on immigration issues and chooses bright, graduating college seniors for $20,000 grants.
Merage himself is an immigrant, having come to the U.S. from Iran in the early 1960s.
His Children First Foundation recruits skilled retirees to work in jobs in early childhood development with low-income kids.
The Merage Foundation for U.S.-Israel Trade seeks to promote business ties between the countries.
He’s also a major benefactor to local Jewish causes, such as the Merage Jewish Community Center of Orange County in Irvine.
Merage is best known locally for his $30 million donation in 2005 to the University of California, Irvine’s business school, which is named after him. He sits on the dean’s advisory board at the business school.
He also has served on several boards, including those of the Segerstrom Center for the Arts and the Pacific Symphony.
Merage’s sprawling Newport Coast estate is featured on luxury-home websites.
—Sherri Cruz
