OC'S WEALTHIEST

Orange County Business Journal, Aug 9-Aug 15, 2004 by Padilla, Mathew, Lyster, Michael, Simons, Andrew, Cruz, Sherri, Bellantonio, Jennifer

Real Estate, Tech, Banking, Hard Work Made Them Rich; Many Dabble in Politics, Social Issues

No. 1

DONALD BREN

Owner, chairman, The Irvine Company Estimated worth: $7.5 billion

By our estimate, Don Bren got richer in the past year as his greatest asset-land-continued its escalation in value.

We decided to add half a billion to Bren's estimated worth, bringing him in at $7.5 billion. The catalyst: Northern Sphere, a 7,700-acre development The Irvine Company owns near the former El Toro Marine base.

This November, the company is kicking off sales of the first housing project at Northern Sphere.

The impact on Bren's wealth during the life of the project should be sizable-Irvine Co. residential land is said to sell for $1 million to $3 million per acre.

That puts the potential market value of Northern Sphere's residential acreage at more than $2 billion.

To come up with this year's higher estimate, we've factored in debt and planning costs, and that the company could face challenges to phases of Northern Sphere. We also took into consideration that 5,700 acres of Northern Sphere are set to remain as open space or parks.

But add to that rising values for the Irvine Co.'s office buildings, and we feel comfortable with this year's estimate for Bren. Sources contend he's worth much more than even this year's higher estimate.

Interestingly, Forbes still has Bren at $4 billion, where he's been for the past few years.

Bren is far ahead of the second wealthiest person on our list, Ernest Rady, who runs Irvine-based Westcorp Inc. and checks in at an estimated $2 billion.

In fact, Bren's worth is more than all others in the top five combined, including Broadcom Corp. cofounders Henry Samueli and Henry Nicholas, who eclipsed Bren for a while during the technology boom.

Bren's wealth comes from a real estate empire of unrivaled size for a single person in California, and perhaps the country.

His holdings include 400 office and industrial buildings, 35 shopping centers, 80 apartment complexes, two hotels, five marinas and three golf courses. He's said to shun stocks.

In all, Bren's investment properties come in at about 30 million square feet. His holdings of developed or developable land are estimated at 25,000 acres in OC.

Among Bren's holdings: parts of the 5,000-acre Irvine Spectrum and Newport Center, half of the 185-acre University Research Park and all of Fashion Island, Jamboree Center and the Four Seasons hotel Newport Beach.

He's set aside more than half of the 93,000-acre Irvine Ranch as open space and pledged up to $30 million through the Bren Stewardship to manage, preserve and restore land on the Irvine Ranch.

In recent years, Bren has expanded beyond OC, adding office buildings, shopping centers and apartments in San Diego, Los Angeles and Silicon Valley. Last year Bren paid an estimated $135 million for Symphony Towers, a downtown San Diego trophy tower.

Bren's diverse real estate portfolio helped him weather the commercial real estate downturn of the past few years. As industrial and office space started to slump, Bren's housing and retail operations gained steam. Lots sold to homebuilders and wealthy buyers at Shady Canyon, Turtle Ridge and Quail Hill have commanded top dollar.

And Bren's malls and shopping centers have enjoyed strong demand from consumers who keep spending, aided in part by refinanced mortgages.

Now, with some signs of cooling in housing, the office market seems ripe for a comeback. Brokers say Bren is raising office rents as much as 5% at his most popular buildings around Fashion Island.

Likewise, Bren's Irvine Apartment Communities arm could be in for resurgence. The unit is developing key sites in Irvine and a big project in Silicon Valley. Economists expect the rental market to pick up as the county adds jobs and higher interest rates cool the housing market.

OC has felt the ripple effects of Bren's wealth. In December, Bren gave $20 million to University of California, Irvine's computer school and recently was awarded a UC medal.

In all, Bren's given $42 million to UCI and has endowed more chairs at the University of California than any other donor.

In 1977, Bren was part of a group thatacquired a controlling stake in the Irvine Co. In 1983, he bought out most of his partners for $518 million. In 1996, he took sole ownership of the company.

-Mathew Padilla

No. 2

ERNEST S. RADY

Chairman, chief executive, Westcorp Inc.;

Chairman, American Assets Inc.;

Chief executive, president, ICW Group

Estimated worth: $2 billion

It's been a good year for Irvine-based bank operator Westcorp Inc., and, by extension, Ernest Rady.

With a 30% rise in Westcorp's shares in the past year, we've upped our estimate of Rady's wealth from $1.5 billion last year to $2 billion. He owns more than two-thirds of Westcorp, which counted a recent market value of $2 billion.

Westcorp runs Western Financial Bank and auto lender WFS Financial.

Even at this year's higher estimate, we don't feel our number for Rady is aggressive. That's because his wealth goes beyond Westcorp.and includes San Diego real estate holdings, investment management and insurance companies.