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Monday, Oct 3, 2022

Ultra-Rich Make Impact on LA, Even If They Don’t Live Here

When   Jeff Bezos paid David Geffen $165 million   for the Jack Warner estate in March, it made headlines not only for being the largest residential sale in Los Angeles but also because a Big Tech titan bought an iconic Hollywood mogul’s property — as a part-time home. 

Bezos, the founder and chief executive of Amazon.com Inc., still lives in Medina, Wash., just across the lake from his company’s Seattle headquarters. But Bezos’ Los Angeles concerns — Amazon Studios, IMDb and Ring, among others, all have large offices in L.A. County — are high-profile enough to merit a sprawling, showcase compound. 

Convenience and security aside, the trophy property is also a savvy branding move that adds a dash of Hollywood pedigree to his tech company’s entertainment businesses.

But the world’s richest man — worth a reported $200 billion, according to Forbes — is not alone. He’s among a group of super-wealthy who spend time in Los Angeles for work or play but officially live elsewhere. 

Call them outsiders, if you will, but many of these ultra-rich, part-time Angelenos have a large presence here, and they often contribute more than most full-time residents.

Like Bezos, former Microsoft Corp. Chief Executive Steve Ballmer’s main residence is in Washington. He officially calls Hunts Point home, which is just up the road from Bezos’ place in Medina.
As the owner of the Los Angeles Clippers since 2014 and the Forum since March, Ballmer is an outsider with an outsized profile in the Los Angeles community. 

He wields his local influence generously as a team owner, business mogul and philanthropist. Besides developing the Inglewood Basketball and Entertainment Center and working with USC-incubated startups like Second Spectrum Inc. on augmented reality game-viewing apps such as Courtvision, Ballmer is heavily involved in philanthropy. 

The Ballmer Group foundation, which he co-founded with his wife, Connie, has donated more than $130 million to charitable organizations across the Los Angeles area, including more than 34 groups working toward racial equity in mostly Black communities. 

He’s proactive and timely, recently donating $1 million in Covid-related aid to local community groups, including the Los Angeles Unified School District and homeless support organization Brilliant Corners.
Together with the Clippers Foundation, Ballmer and his wife gave $10 million to the Los Angeles Parks Foundation to fix up 350 public basketball courts across the city. 

Regardless of where he hangs his hat, Ballmer’s footprint in Los Angeles is bigger than many other permanent and part-time residents, although, to be fair, the Bezos Day 1 Families Fund last year donated nearly $14 million to local organizations that are tackling homelessness.

Stadium builder

Ballmer isn’t the first or only out-of-town team owner, but with a net worth of $71.5 billion, according to Forbes, he is certainly one of the richer ones. Still very wealthy with an estimated net worth of $8.3 billion is Stan Kroenke, the   Business Journal’s 2020 Business Person of the Year   and also a big name in L.A. sports. 
The real estate mogul — who married Walmart Inc. heir Ann Walton — not only brought the Los Angeles Rams back to town in 2016 after more than 20 years in St. Louis but also teamed up with Stockbridge Capital Group to build the 70,000-seat SoFi Stadium. 

While Kroenke and his wife have two properties in Beverly Hills, a compound in Malibu, and two children who also live in the Los Angeles area, their official residence is the historic 535,000-acre Waggoner Ranch in Electra, Texas, where there are no state income taxes. 

Similarly, Colorado billionaire Philip Anschutz’s L.A.-based venue and event management company ASM Global has ownership stakes in the Los Angeles Lakers, Los Angeles Kings and Los Angeles Galaxy, as well as Staples Center, L.A. Live, the Greek Theatre and Dignity Health Sports Park. 

That’s a massive presence in the city for Anschutz, who is worth a reported $10.1 billion and was once dubbed “the man who owns L.A.” by The New Yorker. But he has always kept a low profile regarding his holdings here. Anschutz may have helped kick-start downtown L.A.’s renaissance with the Staples Center development but he is still primarily associated with his Denver home.

Media titans

Sports team ownership looms large as a draw for L.A.’s part-time ultra-wealthy, but other techies besides Bezos and Ballmer are spending more time here despite officially living elsewhere. 
Worth an estimated $5.1 billion, former Hewlett-Packard and eBay Inc. Chief Executive Meg Whitman still shares a home with neurosurgeon husband Griffith Harsh IV in the pricey Silicon Valley town of Atherton but has spent a good chunk of the past two years in Los Angeles working on the launch of Hollywood-based mobile video streaming service Quibi, where she is CEO. 

Until March 16, when Quibi’s offices went fully remote to comply with stay-at-home regulations, anyone swimming in UCLA’s pool at 6 a.m. could have run into Whitman, according to The Verge. 

She listed her two-bedroom condo in West Hollywood’s Sierra Towers on Aug. 10 for $6.5 million, but it’s unclear whether Whitman is moving to another residence in Los Angeles.

Not all traditional media and entertainment moguls who spend a lot of time in Los Angeles call it home, either. Oprah Winfrey’s OWN is based out of The Lot Studios in West Hollywood, but the media titan, who is worth a reported $2.6 billion, has called “The Promised Land,” her 70-acre Georgian-style estate in Montecito, home since 2001. 

South Korean “Parasite” producer Miky Lee, who grew her grandfather’s CJ Group into a $4.1 billion media powerhouse, officially lives in Orange County but spends most of her time at “Futureland,” her family’s $15 million, 12,000-square-foot estate overlooking Beverly Hills.

Meruelo Group founder and Chief Executive Alex Meruelo, who grew up in Los Angeles and made his initial fortune here with La Pizza Loca, is now worth $2 billion, according to the most recent estimates. His company, which spans hospitality, gaming, engineering, construction, food service, banking and media — including L.A. radio and TV stations such as KLOS and KBEH — is based in Downey. But Meruelo and his wife have called Reno, Nev., home since 2011. 

There are numerous reasons why ultra-wealthy outsiders don’t call Los Angeles home, but taxes are clearly a consideration, especially when places like Florida, Nevada and Texas have no state income tax. 

Identity and image matter, too. Bezos and Amazon, for instance, are inextricably linked with Seattle. (He also owns trophy properties in New York and Washington, D.C.) 

The rise of Zoom and remote work means that, increasingly, where you work doesn’t have to be where you live. Los Angeles remains an appealing destination for part-timers who live somewhere else and full-timers who work somewhere else.

Luxury buyers

Despite the pandemic, luxury real estate prices remain strong, and there has been an uptick in sales, according to Hilton & Hyland’s David Kramer, who estimates about 20% of his buyers are out-of-towners.  

“Everyone’s working and educating their children at home, so that’s caused more of a demand for people to buy new homes with enough space,” said Kramer, who says an unusually high run on Malibu rentals this year has led to quick luxury property purchases by the ultra-wealthy, especially homes that don’t need renovations. 

Unlike densely populated urban centers such as New York and San Francisco, Los Angeles in the pandemic era provides sun, space and the ability to socially distance, while still offering the trappings of a big city. 

“I’ve already sold, to date, what I sold all of last year, which was my best year,” Kramer said.

Return to the 2020 edition of the Wealthiest Angelenos. 


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