07 Jun 2011
- Written by D.J. Waldie
GUEST COMMENTARY - The other day, the Los Angeles Business Journal devoted more than 30 pages of a special report (published annually for the past several years) to tell subscribers where the money is. Despite three years of deep recession, to be rich in Los Angeles is to be very, very rich.In adding up the 50 wealthiest Angeleños, the LABJ put investor Patrick Soon-Shiong on top (nearly $8 billion by the LABJ's account) and Hollywood producer Stephen Bing ($700 million) at the bottom.
In a measure of how rich is rich enough to count, 39 of the 50 wealthiest are worth more than $1 billion (based on the available public data); 21 are worth more than $2 billion, starting with mayoral aspirant and developer Rick Caruso.
The list, by the LABJ's choice, focuses on individuals. The richest families of L.A. control far greater wealth through trusts and investment pools. And the definition of Angeleño [link] in LABJ's list is comfortably elastic. If you're worth more than $2 billion, you're a citizen of Richistan and it travels with you from London to Aspen to Dubai, even if Rolling Hills Estates is where your butler is based.
The list has its losers - principally the woebegone Frank McCourt, who was dropped, and Robert Maguire (now ranked 42), whose real estate losses cost him an estimated $165 million. But most of the rich have just gotten richer; 26 of the 35 who were richest last year made at least another $100 million in 2010. Another six saw their wealth grow by at least $90 million.
Not only is the Long Recession over for the very rich in L.A., but for most, the losses they experienced in 2007-2009 have been recovered and more wealth accrued. (The LABJ estimates that the increase in wealth among the top 50 is up about $27 billion from two years ago.)
Nearly all of the rich on the list are men (occasionally a wife is included). Most of the rich are past middle-age (although a few entrepreneurial Chinese-Americans are young and some of the entertainment industry types at least look young). Most of the rich got richer by aggressively moving their wealth around through hedge funds and holding companies. No one gets rich in L.A. by making anything other than movies, except for Andrew and Peggy Cherng, owners of the wildly successful Panda Express chain. They make my goddaughter's favorite orange chicken.
This year's list looks much like last year's. Next year's will look like this one. The very, very rich in LA long ago escaped any "existential risk" to their wealth, unlike middle-class homeowners, who have seen their wages, their 401(k) plan, and their equity wither in value since 2007. For the richest rich of Los Angeles, the prospect is for another boring year of wealth accrual in their own private Richistan and a place far from the real economy.
(D. J. Waldie, author, historian, and as the New York Times said in 2007, "a gorgeous distiller of architectural and social history," writes about Los Angeles every Monday and Friday at 2 p.m. on KCET's SoCal Focus blog. This commentary was posted first at KCET.org) -cw
Tags: Frank McCourt, Los Angeles Business Journal, Rick Caruso, rich, wealth, Stephen Bing, Patrick Soon-Shiong
Vol 9 issue 45
Pub: June 7, 2011