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He quietly built an empire

Mogul Dan Emmett, who likes to keep a low profile, co-founded one of the region's largest office landlords.

March 23, 2008|Roger Vincent | Times Staff Writer

One of Southern California's largest office landlords, Dan Emmett, apparently missed all the memos from Donald Trump about how to act like a real estate mogul.

Although his company owns one of the most desirable office towers in the region, Emmett's personal office is blocks away in a Santa Monica low-rise. On his utilitarian desk, homemade paper signs taped to boxes say "in" and "out."

Notoriously press shy, the 68-year-old Emmett is so little known that people often assume his first name is Douglas because the company he co-founded in 1971 with Jon Douglas is called Douglas Emmett Inc. Each of them put up $7,500 to start developing apartment houses on the Westside.

"I get called Doug all the time," Emmett said.

Today Douglas Emmett is a public company with more than $6 billion in assets including the tallest building in Santa Monica, which consistently commands some of the highest office rental rates in the region and has few vacancies.

"We bought it during a recession," Emmett explained, as if the purchase might be considered extravagant because "trophy properties usually trade at a premium."

Buying real estate at the right time sounds simple enough, but Emmett has a special knack for it, said Douglas, who is no longer involved in daily operations of the company. "The guy has great intuition and great judgment."

Because profits were hard to come by in the early years, Douglas started a residential real estate brokerage on the side "to get some cash we could live on," he said. By the time the partners sold it in 1997, Jon Douglas Co. was one of the biggest brokerages in the country.

Meanwhile Emmett, as chairman of Douglas Emmett, kept a low profile while acquiring buildings in desirable locations, especially the Westside.

Most of them are offices the company leases to small white-collar businesses, but Douglas Emmett also owns a handful of prime oceanfront apartment buildings in Santa Monica and Hawaii, along with the Sherman Oaks Galleria.

The storied mall celebrated in pop culture as the lair of the San Fernando "Valley Girl" was renovated by Douglas Emmett in the late 1990s and turned into a combined office, shopping and entertainment complex.

In recent months, waves of news about the housing downturn, job losses and ongoing credit crunch have begun to depress the commercial real estate sector. PricewaterhouseCoopers last week reported that employment cutbacks were beginning to have an effect on office space demand in several markets, and some analysts are forecasting declines in commercial real estate values of 20% or more.

The downturn may create pitfalls for Douglas Emmett as well as opportunities -- with the backing of its institutional investors such as pension funds -- to pick up more properties, the chairman said.

"We're not immune to national trends," Emmett said. "But our fundamentals are still excellent. Rents are higher than they have ever been."

Although he has avoided the limelight, Emmett is a lifelong Republican and an environmental activist. Being a stalwart Republican pushing a "green" agenda makes him a bit of an oddity, he said.

"It's a tragedy," Emmett said, that environmentalism "got pigeonholed" as a Democratic Party platform plank, because it should be a nonpartisan issue.

While working on a statewide green building initiative with Gov. Arnold Schwarzenegger, Emmett said, it became clear to him that laws and public policies lagged behind science and public awareness.

To help prepare lawyers to address such challenges, Emmett recently contributed $5 million to establish a center on climate change and endow a chair in environmental law at UCLA Law School -- the first such program in the nation.

"It's a pathbreaking gift," said Michael Schill, dean of the law school. And it will be used to leverage another $5 million in donations to match it.

"This will allow us to become the No. 1 environmental law program in the country," Schill said. "We will translate research findings into something people will be able to implement."

Emmett's aversion to publicity was nurtured by his father, a farmer in California's Central Valley. He was a World War I veteran and pilot who commuted by plane to Sacramento to serve in the state Assembly before his son was born. To a young Emmett he repeated the old ditty about "fools' names and fools' faces" often appearing in public places.

In years when the family farm's crops and cattle were good, the Emmetts vacationed abroad and the future businessman picked up an urge for adventure. Emmett became an avid outdoorsman who has skied, dived, kayaked and bicycled all over the globe. He climbed most of the world's seven highest mountains and led the second successful U.S. climb of Mt. Everest.

Tall and lean, Emmett still looks athletic even though he no longer scales tall peaks. He's not shy, but friends describe him as reserved and courtly.

"He is a true gentleman in a rough-and-tough industry," said former competitor Richard Ziman.

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