#1 Donald Bren
Chairman, Irvine Company
Estimated wealth: $14 billion
Want a good clue that Bren has had a pretty good run lately?
Here’s one: The increase in his wealth over the past 12 months likely eclipsed the total fortunes of all but 14 Orange County residents.
The Business Journal estimates Bren, chairman of Newport Beach-based Irvine Company, to be worth $14 billion this year, up from $13 billion a year ago.
As usual, we believe our estimate for Bren is conservative.
The $1 billion increase in wealth for the country’s wealthiest real estate owner reflects a strengthening economy and real estate market, particularly in Silicon Valley and Orange County, two of Irvine Co.’s largest markets.
Irvine Co.’s real estate portfolio totals close to 98 million square feet, including nearly 500 offices, more than 40 retail centers, 122 apartment communities with nearly 47,000 units, five marinas, three golf clubs and three resorts.
The company is the largest owner of offices and apartments in California.
Along with OC and Silicon Valley, the company has sizable holdings in San Diego and Los Angeles.
Its 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, MacArthur Court and The Resort at Pelican Hill.
Rental income from the company’s apartment portfolio—which is seeing thousands of units being built and saw a nearly 5,000-unit acquisition completed earlier this year—is now believed to be Irvine Co.’s largest source of revenue.
The Business Journal estimates that privately held Irvine Co. had about $2.3 billion in revenue last year. 2012 was the company’s best-performing year in the past six years, according to company sources.
The company also is estimated to own 27,000 acres of land in OC, 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.
There’s no doubt that the value of that land has increased over the past year. The Irvine Ranch has been the state’s best-selling masterplanned home community for several years running.
Irvine Co.’s local land holdings are debt-free, and the company is now earning hundreds of millions of dollars annually as homebuilders buy the company’s in-demand lots, or homebuyers purchase homes directly from the company’s in-house builder, Irvine Pacific.
Bren has made the company’s 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., so when the company does borrow, it’s able to do so at rock-bottom rates. A recent 10-year loan for some of Irvine Co.’s previously debt-free office properties carried an interest rate of about 3.18%, and it freed up $875 million that’s expected to be used toward additional office purchases and developments.
The company currently has three large office developments under way, including two office towers in Newport Center. Those projects, as well as an office complex going up in Silicon Valley, are a good sign that the company is optimistic about growth prospects in its core markets.
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.
Bloomberg Businessweek magazine ranks him as 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 schools.
Bren has also 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 wealth: $3 billion
Continued improvements in the real estate market and economy at large helped provide a boost to the bottom line of Orange County’s second-largest commercial real estate owner.
We’ve bumped up our estimates for Olenicoff by $250 million this year.
It’s our highest estimate yet for the longtime mainstay on our list of wealthiest residents.
The Business Journal’s estimate is $600 million higher than Forbes’, which ranks the self-made billionaire as the 213th-richest person in the U.S.
Based on sources familiar with Olenicoff and his wealth, we still believe our $3 billion estimate remains a conservative one—word has it he was an especially aggressive bargain-hunter of stocks during the recession.
We estimate Olen’s 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 Corp. owns more than 7.5 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 Newport Beach-based Irvine Company.
A large portion of Olen’s office portfolio is made up of low- and midrise business parks. The company also owns a skyscraper in Chicago and has a pair of office towers in Irvine.
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 have been debt-free for years.
Other Olen assets include land, marinas, restaurants, airport hangars and a golf course. All told, the square footage of Olen’s total commercial real estate portfolio runs close to 20 million square feet, including apartments.
Real estate is only one source of wealth for Olenicoff. Others include stocks, loans he’s made and cash holdings, according to sources.
Most of the company’s real estate activity in the past year has been on the lending side. Olen is believed to have lent more than $200 million for office projects in Los Angeles, hotel properties in Chicago and other deals.
“More and more so, in order to deploy our liquidity, Olen has resorted to making mortgage loans on everything from (high-rises) to smaller loans around the county,” Olenicoff told the Business Journal in March.
Olenicoff made his fortune after his family fled Soviet Moscow and landed in America, by way of Iran, in 1957. He started Olen in 1973.
—Mark Mueller
#3 David Sun
Cofounder, chief operating officer, Kingston Technology Co.
Estimated wealth: $2.9 billion
#3 John Tu
Cofounder, president, Kingston Technology Co.
Estimated wealth: $2.9 billion
Sun and Tu believe Fountain Valley-based Kingston Technology Corp. is well positioned for the next 25 years in business.
“There will always be a need for memory,” said Tu. “Flexibility and being able to adapt are the keys to continued success. This is what David and I believed when we started this little company 25 years ago, and that is what we still follow today.”
Kingston celebrated its silver anniversary late last year with cash prizes, product giveaways, and a contest that gave consumers a chance to design their own USB flash drive.
The duo is known for their generosity. They made headlines when they handed out $100 million in bonuses to workers after selling 80% of their company for $1.5 billion to Softbank Corp. in Japan in 1996.
They bought it back at a steep discount three years later.
Sun and Tu started Kingston as the sole employees with a single memory product. Today, it’s the world’s largest memory products maker for computers and consumer electronics with some $5 billion in annual sales.
It distributes some 2,000 products in more than 125 countries. The company employs 4,000 people companywide and some 800 in OC.
Kingston grabbed headlines earlier this year at the International Consumer Electronics Show in Las Vegas when it debuted a breakthrough 1-terabyte flash drive, a first for the industry. The USB flash drive, which fits in your pocket, packs the memory capacity of a server.
Sun and Tu are estimated to own the vast majority of the company, and both also have other investments.
We’ve pegged them at $2.9 billion each this year, up from $2.6 billion a year ago. Our estimate is based on the strong gains in the stock market in the last 12 months; Kingston’s gains in higher margin business lines that offset falling prices for its memory products; and comparisons to publicly traded rivals.
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.
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.
Tu is a music devotee who keeps local musicians in gigs with his band, JT & California Dreamin’, which plays benefits.
—Chris Casacchia
#5 William Gross
Cofounder, co-chief investment officer, Pacific Investment Management Co.
Estimated wealth: $2.3 billion
Gross has been working to calm nerves in recent months, emphasizing bonds as an “important anchor” in investment portfolios.
He continued the maritime theme in a recent video, urging investors to “hang tight, stay on board … this ship isn’t sinking.”
That came as Pimco’s flagship Total Return Fund, which has about $268 billion in assets, sagged. It saw a net outflow of nearly $10 billion in June, and was down 2.57% year-to-date as July drew to a close.
Bonds in general have fallen out of favor since May, when a broad sell-off began in reaction to the Federal Reserve’s announcement that the U.S. central bank could cut back on its bond-buying program later this year.
The bond fund benchmark, Barclays Capital U.S. Aggregate Bond Index, has dropped 2.2% year-over-year.
This wasn’t the first time Gross saw a net outflow in his fund. The Total Return lost nearly $5 billion in late 2011 after he made a mistimed bet against U.S. Treasuries, selling off all Treasuries from his then-$234 billion fund.
Gross had spent the first half of 2012 recouping the loss, bringing in nearly $6 billion in new money by the end of June.
The first half of this year has been defined by the dip in the Total Return fund, leading us to keep our estimate for Gross’ fortune even compared with 2012.
The timeline of Gross’ retirement is not clear, but Pimco reportedly has been grooming younger investors in anticipation of the day he leaves. Gross, 69, manages about 63% of Pimco’s mutual fund assets now, down from 84% a decade ago, according to market research firm Morningstar.
Gross and his wife, Sue, are big on philanthropy in Orange County and nationwide.
The William and Sue Gross Family Foundation gives annually to Doctors Without Borders and the Smithsonian’s National Postal Museum, which is opening the William H. Gross Stamp Gallery in September.
Other recent gifts from the Grosses include a donation of $50,000 to Friendship Shelter, a homeless shelter program in Laguna Beach.
Late last year, they gave $4 million to the Sue and Bill Gross Stem Cell Research Center at University of California, Irvine. That followed a $10 million gift to the research center in 2006.
The couple also donated $20 million to Cedars-Sinai Medical Center in Los Angeles last November. That will go toward the hospital’s new Advanced Health Sciences Pavilion, which houses a surgical center named after the couple.
Gross gave $23.5 million to his alma mater, Duke University, in 2005.
The Grosses also gave the proceeds from a stamp auction in New York earlier this year to Doctors Without Borders and the Millennium Villages Project at Columbia University.
—Jane Yu
#6 Henry Samueli
Cofounder, chairman, chief technical officer, Broadcom Corp.
Estimated wealth: $2.2 billion
Broadcom Corp.’s chief technologist is helping steer the Irvine chipmaker into new market segments while strengthening ties with the world’s two most influential consumer electronic companies.
Samueli, an icon at Broadcom and mentor to the company’s global engineering groups, maintains a leading role in high-level strategic and product development for chips that go into computers, smartphones and other consumer electronics.
Under his watch, Broadcom has amassed one of the industry’s largest portfolios of intellectual property, with more than 18,600 U.S. and foreign patents and applications.
Earlier this year, Broadcom introduced the first ultra high-definition TV home gateway chip that produces four times the resolution of current HD TVs.
It also was among the first to supply what’s called high efficiency video coding, which cuts bandwidth requirements in half to deliver digital content to customers.
The company has been winning business from low-cost smartphone makers in Asia, a new front that supplements its long-standing ties to Apple and Samsung, both of which accounted for nearly 32% of Broadcom’s record $8.01 billion in sales in 2012.
We estimate Samueli’s wealth at $2.2 billion, up slightly from last year. The past 12 months have seen strong gains for stocks in general and other asset classes. Samueli’s Broadcom shares—24.19 million that now account for less than half his wealth by our estimate—are down by nearly 20% over the same period.
Samueli has sold more than $1.4 billion in shares since the company went public in 1998, including about $58 million worth in the past year or so; but he remains a major shareholder.
His Anaheim Ducks were knocked out of the first round of the playoffs, missing out on added concession and broadcast revenue.
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 in bad ones.
He also owns Anaheim Arena Management LLC, which operates the city-owned 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 his 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 have given away more than $250 million in the past decade and are among the county’s top philanthropists. Benefactors include the University of California, Irvine, and UCLA, both of which have named their engineering schools after Henry Samueli.
—Chris Casacchia
#7 James Jannard
Founder, chief executive, Red Digital Cinema Camera Co.
Estimated wealth: $2 billion
Red Digital Cinema Camera Co. was pushing 4K resolution as the industry standard when the industry was still stuck on 1080p, or high-definition.
The company makes and sells digital still and motion cameras that have been used to shoot films such as “The Great Gatsby,” “The Hobbit: An Unexpected Journey” and “Oz The Great and Powerful.”
It seems the industry has caught up: More cameras have 4K resolution (which is roughly four times that of high-definition)—a reality that is now trickling down to the consumer level with television makers chatting up 4K TVs.
Red is upping the game: Last month it announced plans for the installation of its 6K Dragon camera sensor upgrade, which is expected to begin in September.
Jannard founded Red in 2006. The company has estimated sales of $300 million and more than 500 workers. That employee headcount went up with the April acquisition of camera accessories company Element Technica of Burbank, now known as Red Element.
Jannard declined to disclose how many workers were added at its Irvine headquarters at the time of the sale.
We’re estimating Jannard’s wealth at $2 billion, largely the result of Red’s increased value.
That’s up from last year’s $1.6 billion, which reflected Jannard’s worth halved based on his disclosure that he had donated a large portion of his money in an effort to divest his wealth. He declined to name the beneficiaries.
The bulk of Jannard’s wealth traces back to the $2.1 billion sale of Foothill Ranch-based Oakley Inc.—the other company he started—in 2007 to Italy-based Luxottica Group SPA. He had a 64% stake in Oakley at the time of its sale and continues to hold the chief mad scientist and visionary title there. He is also believed to own Luxottica stock.
There are also the patents he holds for Oakley and Red products, along with Treasury bonds and other stocks.
—Kari Hamanaka
#8 George Argyros
Chairman, chief executive, Arnel & Affiliates
Limited partner, Westar Capital LLC
Estimated wealth: $1.8 billion
Solid gains in real estate and the stock market provided a big boost to Argyros’ bottom line last year.
We’ve estimated Argyros―one of Orange County’s richest real estate owners and most politically connected businessmen―at $1.8 billion this year.
That’s a $300 million increase from a year ago and a $700 million bump from our 2011 estimate.
We’re still $200 million below the latest valuation given to Argyros by Forbes magazine, which ranks the former ambassador to Spain as the 250th richest person in the U.S.
Argyros owns Costa Mesa-based Arnel & Affiliates, a development 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 OC.
Conservatively factoring in debt and a likely boost of 15% or more to the value of his apartments and other local holdings over the past year, the Business Journal estimates Argyros’ wealth from real estate to be worth close to $1 billion.
He’s the largest individual investor in DST Systems Inc., a Kansas City, Mo.-based software company that has a $3 billion market value. DST shares are up some 30% from a year ago.
Argyros’ 21.7% stake in the company is now worth about $670 million, up more than $150 million from a year ago.
DST is an early investment of Westar Capital LLC in Costsa Mesa, Argyros’ investment firm.
Among his other investments: stakes in Santa Ana-based First American Financial Corp., as well as Pacific Mercantile Bancorp in Costa Mesa, where he’s a director of the bank holding company.
Argyros, the former owner of the Seattle Mariners, also has a large stock portfolio, in addition to other investments.
Last year was a busy one for Argyros and his family on the philanthropy front. Recent gifts include a $2.5 million pledge to the Alzheimer’s Association, a $5 million donation to CHOC Children’s Hospital in Orange, and $2.5 million to Hoag Memorial Hospital Presbyterian, among others.
—Mark Mueller
#9 Henry T. Nicholas III
Cofounder, Broadcom Corp.
Estimated wealth: $1.5 billion
Nicholas’ foray into the music industry has played out much more quietly than his previous business ventures.
The Broadcom cofounder and visionary is behind one of the largest hip-hop festivals in the world and backed some of the industry’s biggest reunion shows in recent years.
Nicholas, a self-described music lover, is the primary owner and shareholder of Guerrilla Union Inc., which melds music, arts, culture and technology. The Pomona-based company hosts Rock the Bells, a hip-hop festival featuring dozens of acts, with shows pegged for Los Angeles, San Francisco, New York and Washington, D.C., this summer.
His Aliso Viejo-based Level 7 Artists production company was behind Sublime’s 2009 reunion tour with lead singer Rome.
Nicholas continues to devote much of his time to crime victims’ rights and helping high school students who face economic and cultural barriers. He was the chief architect of California’s Marsy’s Law, named for and inspired by his sister Marsy, who was murdered in 1983.
He was honored this year by the Orange County district attorney as a keynote speaker at the Annual Victims’ Rights March and Rally. Nicholas is a recipient of the Ronald Reagan Award for Pioneering Achievement in Criminal Justice and has received awards from Crime Victims United of California, the National Crime Victims’ Institute, and the Los Angeles County Sheriff’s Department.
He founded the Nicholas Academic Centers in 2008 with retired Orange County Superior Court Judge Jack Mandel to provide after-school guidance, tutoring, mentoring, cultural enrichment, and access to college recruiters for underserved, primarily Latino students in the Santa Ana Unified School District.
Since its inception, NAC has graduated 356 students, with 100% of graduates going on to top colleges.
Nicholas is sole trustee of the Nicholas Technology Holding Trust, which holds about 26.2 million Broadcom shares, which had a recent market value of approximately $720 million. For the last three years, he has not sold shares of Broadcom, which makes communication chips that go into computers, smartphones and consumer electronics. He has sold an estimated $1.2 billion in shares since the company went public in 1998.
We estimate his wealth even from last year at $1.5 billion, with a dip of about 20% in Broadcom shares over the past 12 months offsetting likely gains from a generally strong stock market and other assets classes.
—Chris Casacchia
#10 Paul Merage
Chairman, MIG Capital LLC
Estimated wealth: $1.2 billion
Gains in the market value of real estate investment properties over the past year, along with growth in the stock market overall, serve as a basis of a modest increase in our estimate of Merage’s net worth.
Merage, an entrepreneur and a longtime venture investor, oversees the MIG companies in Newport Beach as chairman. Affiliates of MIG—Merage Investment Group—include MIG Capital, MIG Real Estate and MIG Private Equity. The units combine for more than $1 billion in assets under management.
MIG Real Estate, run by Merage’s nephew, Greg, makes direct investments in commercial real estate properties. It operates shopping centers, hotels, and office and multifamily properties, managing about $750 million in assets.
Much of Merage’s wealth is believed to have come from the $2.6 billion sale of his frozen-food manufacturing company, Chef America Inc., to Nestlé in 2002.
Merage, with his brother, David, founded Chef America in 1975 and grew it to be among the largest food companies in the U.S. The company was most well known for its Hot Pockets products.
Merage came to the U.S. from Iran in the early 1960s. He is known for his philanthropy work in OC, including the $30 million donation in 2005 to the University of California, Irvine’s business school, which bears his name.
The Paul & Elisabeth Merage Family Foundation gave about $1.5 million in 2011, the latest annual number available.
Merage also gives through the education-focused Merage Institute. Among its core initiatives is the U.S.-Israel Innovation Bridge Business Leadership program, which trains
Israeli high-tech entrepreneurs to share technology with U.S. companies and consumers. It has graduated more than 300 Israeli business leaders.
The Merage Institute also runs High Hopes for Children, a program designed to help improve education in lower-income areas in OC, with a particular focus on the El Sol charter school in Santa Ana.
—Jane Yu
#10 Vinny Smith
Partner, Toba Capital
Partner, Integral Communities
Estimated wealth: $1.2 billion
Smith joined the billionaire’s club last year after cashing out some $800 million after Quest Software was acquired by Dell Inc. in a $2.8 billion deal.
This year he’s putting some of that money to work across an investment portfolio much more diverse than we previously understood.
The Business Journal in June chronicled some of Smith’s big real estate plays in the Bay Area as a personal investor and chief financial backer behind Newport Beach-based developer Integral Communities.
His ties to Integral, which has about 20 large-scale projects in the works and a forecast of $500 million in revenue over the next 12 months, were largely unknown at the time.
So were his plans on his newly launched Irvine investment firm, Toba Capital, until the financier, tech entrepreneur, and real estate developer provided some details in a one-on-one interview.
Toba recently acquired a bundle of venture-backed companies, pushing its portfolio to an estimated 20 companies with some $200 million behind them.
Smith, who keeps a low public profile in OC, plans to put another $200 million into Toba’s inaugural fund.
“We haven’t figured out the total size, but it will be somewhere around $400 million,” he said. “Even though it’s an evergreen fund, I want to have a defined amount to be able to measure it up and compare it to other funds.”
Smith is working his way to his third and fourth fortunes if the bets he has made on real estate and venture capital hit pay dirt.
We estimate Smith’s wealth at $1.2 billion, up from $1 billion a year ago.
That takes into account his Quest cash-out, strong gains in the stock market in the past 12 months, income generated by Integral and other real estate deals, and a few exits from his venture capital investments.
Smith started his career with Oracle in 1986 after graduating from the University of Delaware, where he wrestled. In 1992, he started San Francisco-based Patrol Software with an Oracle colleague. BMC Software Inc. bought Patrol in 1994 for an estimated $33.7 million.
Smith supports several charitable causes, including the Miocean Foundation; Augie’s Quest, which battles Lou Gehrig’s disease; and various kids programs. Recent giving includes a $4 million grant to Mount Saint Joseph High School in Baltimore, where he attended; seeding Newport Beach-based Gen Next Foundation with a $1 million grant; and $1 million to Irvine-based nonprofit Fuel Freedom Foundation.
—Chris Casacchia
