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Oracle CEO Larry Ellison makes Malibu real estate his own

Ellison has bought nearly two dozen properties in the beach community during a decade-long shopping spree, including at least nine homes on coveted Carbon Beach.

May 05, 2013|By Lauren Beale, Los Angeles Times
  • Larry Ellison has spent an estimated $200 million to $250 million on homes on Malibu's coveted Carbon Beach.
Larry Ellison has spent an estimated $200 million to $250 million on homes… (Aerial imagery by Pictometry…)

On busy Pacific Coast Highway in Malibu, some well-kept facades conceal a secret.

Behind the Mediterranean with wooden doors, the white stucco two-story with a red tile roof, the long wall obscuring a three-structure compound, hides a singular, massive wealth fueled by obsession.

This is Larry Ellison territory, where a Bay Area billionaire with seemingly endless patience and resources is buying up the best spots along Malibu's 21 miles of coast.

PHOTOS: Expensive things Ellison has bought

The Oracle Corp. chief executive has bought nearly two dozen properties in the beach community, according to a public records search conducted for The Times by PropertyShark.com.

Ellison has spent an estimated $200 million to $250 million through at least nine purchases, in one case of multiple homes, on coveted Carbon Beach. Along the way, the software tycoon dropped millions on a wooded estate near the Franciscan friars in gated Serra Retreat. He also has bought an inland tennis club, Casa Malibu Inn and coastal restaurant property.

More purchases could be veiled behind a maze of limited liability companies — a false front popular with the rich and famous — but area real estate agents who have followed the deals believe the number is accurate.

The decade-long shopping spree in Malibu represents just the tip of Ellison's trophy-property iceberg.

Ranked as the third-richest person nationwide by Forbes magazine, with a fortune estimated at $43 billion, Ellison owns multiple estates in Northern California and several Lake Tahoe houses. His Rancho Mirage mansion sports a golf course. Last year he bought most of the Hawaiian island of Lanai for more than $500 million.

But why the laser focus in Malibu?

The notoriously press-shy Ellison declined to comment on his real estate purchases. The tech titan, who came from modest circumstances and derives most of his fortune from the Redwood City, Calif., software company he co-founded, has described himself as an amateur architect who loves to tinker with houses as a hobby.

"When I was a kid, the first thing I ever wanted to be was an architect," Ellison said in a rare interview last fall with CNBC. "So I love building houses, remodeling houses, designing houses, converting houses."

His real estate agent said the attraction to Malibu is simple. The beautiful stretch of coast draws visitors from around the globe, is close to the entertainment capital of the world and enjoys moderate weather year-round.

"There are only so many seats in the front row," said Kurt Rappaport, co-founder of Westside Estate Agency.

"If you take the best section and the most prime property, that's inherently a great investment," Rappaport said. "That's what Larry recognized and sees."

Vision and timing have enabled Ellison to accrue a collection of properties that would be difficult to replicate today.

Ellison's sweet spot lies within the crescent-shaped swath of 70 or so home sites along Carbon Beach, where he rubs suntanned elbows with the likes of entertainment mogul Jeffrey Katzenberg and former Dodgers CEO Jamie McCourt.

Along the 1.5-mile stretch known as "billionaires' beach," the roar of the crashing waves on one side of the homes is matched on the other side by the hum of vehicles on well-trafficked PCH. Plainclothes security keeps a watchful eye on the comings and goings here.

A recent purchase was a three-structure copper-roofed compound that Ellison bought last year for $37 million from former Yahoo Inc. CEO Terry Semel and his wife, Jane.

Word among the neighbors is that Ellison is doing a variety of things with his Carbon Beach collection.

He has bought houses, kept them up, leased them out, sold some, redone others and fixed one up for use by his children, said Jack Heidt, whose family had a 1926 weekend home there for 60 years before selling five years ago. "He has been very good for Carbon Beach."

The bulk of Ellison's Carbon Beach homes were bought in the $10-million to $17-million range from fellow billionaires.

"People initially thought the prices we paid were high," Rappaport said. "Now you look back and they are great values."

A buyer with a net worth of $43 billion is not price-sensitive, said Jan Brzeski, portfolio manager for Arixa Capital, which makes loans on prime-location homes being renovated for resale. A house on Carbon Beach, he said, "is worth what Larry Ellison thinks it is worth."

And as a hedge against inflation, real estate is a good place to park his money. The super-wealthy often collect high-end real estate, but Ellison's focus in Malibu is unusual in its intensity.

Billionaire medical research entrepreneur Patrick Soon-Shiong, for instance, has been buying ranch homes in a Brentwood neighborhood since 2006 at $5 million or so a pop. His spending barely compares.

Ellison is far from a typical profit-chasing real estate investor, said Greg Hebner, principal at Los Angeles-based Arixa. "He makes these investments because he enjoys it."

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