Newhall Land and Farming Company
From Wikipedia, the free encyclopedia
| Newhall Land and Farming Company | |
|---|---|
| Type | Land developer |
| Founded | 1883 |
| Founder | Newhall family |
| Headquarters | Valencia, California, USA |
| Industry | Real estate |
| Website | http://www.valencia.com/ |
The Newhall Land and Farming Company is a land management company based in Valencia, California, United States. The company is responsible for the master community planning of Valencia, as well as the management of farm land elsewhere in the state.
[edit] Company history
The company was incorporated on July 1, 1883 by the five sons of Henry Newhall (William, Edwin, Henry, Walter, and George), a businessman who had purchased a number of former Mexican land grants. Newhall had died the previous year and had instructed his sons not to sell the land.[1] The company initially had 143,000 acres (579 km²) of land, ranging from Monterey to Los Angeles counties. Unfortunately, the income generated by ranching was not enough to support the families of all five sons in the comfortable lifestyle they had grown up with,[2] and they began to sell off portions of their vast holdings in order to generate income.
Successive land sales allowed the Newhalls to maintain their lifestyle, but William (who was known by his middle name Mayo), a graduate of Yale University, understood that they needed a better way to generate income. After a few more land sales, Mayo took the income and reinvested it into the land by developing agriculture. The land around their headquarters, the former Rancho San Francisco, was cleared for citrus trees, and lima beans were planted in the Sacramento Valley. The income from these crops allowed the company to grow in the 1920s. Additionally, one more land sale, a 38,000 acre (150 km²) parcel in 1922 to William Randolph Hearst for $1 million (to be paid in installments over ten years) helped fill the company's coffers.
The collapse of the St. Francis Dam in 1928 was devastating to the company. Its livestock, orchards, and buildings were all destroyed. Although the city of Los Angeles agreed to pay reparations for its role in the dam's construction, those payments would not be available for some time. Compounding the problem was the onset of the Great Depression. George Newhall, who was the last surviving of Mayo's brothers and treasurer of the company, died that year, and Mayo discovered that the company was bankrupt and on the brink of insolvency.
At this point, Mayo was in his late seventies and growing increasingly frail. He turned the operation over to his son-in-law, Atholl McBean, a San Francisco businessman who had held onto his entire savings during the Wall Street Crash. With McBean's money, the company was able to hold on long enough for the reparations payments to come through. That, combined with the last of the Hearst payments, was enough for the company to climb out of debt. By his third year in charge, Newhall Land and Farming reported a profit of $25,000[2] and by 1935, they resumed dividend payments, the first since 1930.
Henry Newhall had purchased Rancho San Francisco from some speculators who had purchased it from Ygnacio del Valle in the hopes of finding crude oil. Alex Mentry had discovered oil in 1876 just to the south of the rancho, but this group of investors had had no such luck. McBean was convinced no oil was to be found on the land, which by now he had renamed Newhall Ranch, but he leased it to Barnscall Oil Company anyway. To his great astonishment, Barnscall struck oil in 1937 and there was so much oil that over the next few years, 44 oil wells were producing millions of dollars of "black gold" for the company,[2] which ended all of their cash flow problems.
By the 1950s, urbanization began to encroach on Newhall Ranch. The County of Los Angeles, hoping to encourage more residential development, changed its rules for property taxes, taxing land at what its "best use" would be, regardless of its actual use. Newhall Ranch was assessed to be a residential zone,[3] which substantially increased the tax burden of Newhall Land and Farming. McBean understood that agriculture alone was not going to pay the taxes, and that if the land was to be designated for residential homes, the company might as well head in that direction.
Real estate developers made offers to buy the land, but family members did not want to sell pieces of the family homestead. Instead, McBean hired city planners and the company opted to create a brand new city, which would be called Valencia after the oranges they had grown for so many years. Construction began in the early 1960s, the Master Plan adopted in 1965, and the first new homeowners moved in in 1967. McBean retired soon after, turning over the company to non-family members.
During the next two decades, the company continued to flourish. Valencia experienced steady growth and garnered praise as a new town. 1971 saw the opening of Magic Mountain amusement park, which was sold to Six Flags in 1979. In the 1980s, the company expanded its oil interests to seven states and Canada, and found another revenue source in leasing its land for film and television show production. In 1994, the company submitted plans to the county for a new master-planned community to be named Newhall Ranch.
[edit] External links
[edit] References
- ^ Company History. Newhall Land and Farming Company. Retrieved on 2007-04-20.
- ^ a b c "The Newhall Land and Farming Company". Encyclopedia of Company Histories. The Gale Group. Retrieved on 2007-04-20.
- ^ Worden, Leon. "Postwar growth of the Santa Clarita Valley", Santa Clarita Valley Historical Society, February 19, 1997. Retrieved on 2007-04-20.
