All the ingredients pointed to another good year for the richest residents of Orange County: an extraordinarily strong run in stocks, continued briskness in the commercial and residential real estate sectors, and some surprising resilience in the bond market.
Then the clincher came—or didn’t come at all, as it turns out. Wall Street held about steady—a one-day dip toward the end of the week not withstanding—right up to the time the Business Journal went to press with this week’s special issue, anchored by our 14th annual OC’s Wealthiest list (see profiles in special section that starts on page 15; list starts on page 28).
Stocks continued their yearlong upward trend last week. The S&P 500 was up 17.5% over the past 12 months, the Dow Jones Industrial Average posted a gain of nearly 10%, and the Nasdaq was ahead by about 23%.
That was a key factor in helping the 39 individuals on this year’s list—there are 38 entries, with one pair listed jointly—combine for an increase of 10.4% to an estimated total net worth of $54 billion.
The consistently robust stock market was a switch.
Last year’s midsummer swoon set in just as final figuring went into our estimates for the members of the list.
The year prior featured a moderate case of the jitters—the markets went into a stall as August started and headed downward a bit, but regained altitude before the month was out.
A precipitous drop in the summer heat of 2011 led to late revisions of estimates for members of the list. It started in mid-July, putting our annual list right in the middle of a four-week slide that took the S&P 500 down by about 17%.
The absence of any midsummer slam was a chief factor in the double-digit overall increase this year.
Big Gainers
Other contributions came from individuals whose business moves likely made bigger strides than the gains of the equity markets over the past 12 months.
Among the largest increases by our estimates:
• No. 10, Vinny Smith, the one-time head of Quest Software Inc. who was vaulted to the ranks of local billionaires after the $2.8 billion sale of the Aliso Viejo-based company to Dell Inc. in 2012. Smith has stayed busy over the past year through his new lines of business—a venture capital firm and real estate developer—and we estimate his net worth is up by about 25% to $1.5 billion (see entry, page 22).
• No. 11, Arte Moreno, whose Los Angeles Angels of Anaheim were already getting the benefit of a general lift in the value of big-league sports franchises, thanks to a wave of impressive cable contracts. Then came the $2 billion sale of the Los Angeles Clippers basketball team, which sent everyone back to their calculators for upward revisions of Southern California sports franchises. We estimate those factors, along with a baseball team that’s back to top form on the field, took Moreno’s wealth up by better than 25% to $1.4 billion (see entry, page 25).
• No. 16, William Lyon, a perennial member of the list who more than survived the recent recession. Lyon has ridden the housing rebound and has come back to the ranks of OC billionaires by our estimate for his net worth. Our estimate is up 25%, or $200 million from a year ago. A highlight of his big year: gains for his namesake homebuilder, which went public last year and have risen about 13% since then to a market value of about $900 million, with Lyon’s stake worth roughly $165 million, according to regulatory filings (see entry, page 26).
Lyon’s return to billionaire status made a total of 16 on this year’s list, the most ever.
Irvine Company Chairman Donald Bren alone added $1 billion in wealth to the list (see related entry, page 18). He remained far and away the wealthiest person in Orange County—and the richest real estate mogul in the U.S.—with an estimated net worth of $15 billion.
Bren’s total lifts the entire list to an average of about $1.4 billion.
The other entries would average just more than $1 billion apiece without Bren.
Data Points
The $54 billion total for the list about equals the gross domestic product of Bulgaria. The per capita GDP comes to about $7,000 for the Balkan nation, which has a population of 7.5 million and is a member of the European Union.
The combined net worth of the members of the OC’s Wealthiest list comes to about $14,000 per resident of Orange County.
Methodology
Our listings are limited to individuals who live here or derive most of their wealth from OC.
It takes an estimated worth of $250 million to crack this week’s list, the same threshold as last year.
We’ve spent weeks looking into individual holdings, company assets, public records and press clippings, and talking with trusted sources as we’ve researched the list.
Our numbers are generally conservative, ballpark figures. We’ve sought to take assets into account, factor in debt, determine the cost of exercising stock options, and consider other factors.
Some individuals on our list cooperated with us to provide guidance for our estimates, while others declined.
A few have told us they would prefer not to be on the list at all.
The list remains a work in progress.
We’ve done our best to track down who we believe are OC’s wealthiest people. But we are sure to have missed some. We look forward to comments on those we may have overlooked.
