Schwarzenegger reveals pumped-up finances
Sunday, August 10, 2003
Arnold Schwarzenegger, the cinematic action hero-turned-Republican politician, has parlayed his success in Hollywood into a multimillion-dollar web of real estate holdings, entertainment-oriented businesses and a mega-portfolio of stocks and bonds, according to a financial disclosure report filed Saturday.
The report, filed to comply with state clean-government laws, underscores the wealthy actor's opulent lifestyle, which is far removed from that of the ordinary voters Schwarzenegger is now wooing as a candidate in his Oct. 7 recall campaign for governor.
Schwarzenegger is one of several millionaires in the race to replace Democratic Gov. Gray Davis: Republican Peter Ueberroth, former baseball commissioner, filed his own disclosure report Saturday, indicating his assets top $68 million. Reports for other wealthy candidates, including Republican business executive Bill Simon and commentator Arianna Huffington, weren't immediately available.
Schwarzenegger's report shows that in the 35 years since he arrived in California as a young Austrian bodybuilder, he has built an entertainment conglomerate and invested heavily in real estate holding companies, venture capital funds and blue-chip stocks. His holdings include an Ohio shopping mall, a charter airline and bonds issued by the agency that operates a youth prison in Walnut Grove, Miss.
His income is boosted further by trusts set up to benefit the family of his wife, Maria Shriver.
To guard against conflicts of interest, California's Political Reform Act requires candidates to list their investments and sources of income on reports called "statements of economic interest." Filers are only required to give estimates of their income and investments, indicating, for example, whether a holding is valued at $1 million or more.
Thus, the report gives only the outlines of Schwarzenegger's wealth. He has promised to make public his tax returns, which contain specifics about his net worth, later in the campaign.
He has commanded $10 million per movie since 1994's "True Lies." For this summer's "Terminator 3," his paycheck topped $30 million.
But the report shows the heart of Schwarzenegger's financial empire is Oak Productions, a Santa Monica entertainment concern.
Schwarzenegger, who in his bodybuilding days was styled the "Austrian Oak," set up the firm in 1977, according to state records. It produced "Last Action Hero," the 1993 comedy and one of only a handful of Schwarzenegger films that have bombed. It's also the vehicle through which Schwarzenegger is paid for his movie roles -- from Conan the Barbarian to the cyborg Terminator -- and for video game and comic book spin-offs and licensing arrangements.
Schwarzenegger owns a stake of more than $1 million in the firm: Through it, he draws income from a long list of entertainment concerns, including 20th Century Fox, Columbia Pictures, MGM-United Artists, Walt Disney, DC Comics and video game manufacturer International Game Technology.
He owns a stake of more than $1 million in two other entertainment ventures. One is Pumping Iron America, named for the 1977 documentary about bodybuilding that made him famous. He draws income through it from weightlifting videos and a line of sports clothing, public records show. The other is Fitness Publications Inc., which distributes Schwarzenegger's weightlifting books.
The report says Schwarzenegger holds a $1 million stake in several real estate holding companies, including 812 Main St. Inc., which owns a Venice health club once known as the World Gym, along with other Venice real estate.
Another is Main Street Plaza Inc., which owns a 30,000-square-foot building in Santa Monica. The building houses apartments, offices and the celebrity restaurant Schatzi on Main, which Schwarzenegger founded in 1991 and leased to another manager in 1998. He also owns a stake in A.S. Ohio Ventures, owners of a mall near Akron.
Meanwhile, Schwarzenegger also has extensive stock holdings and more than $1 million in 10 investment partnerships, including mutual funds and venture capital concerns.
His portfolio includes more than $100,000 worth of General Electric Co., Coca-Cola, PepsiCo, Starbucks Coffee, Wal-Mart and Target stores and Pfizer Inc., the pharmaceutical concern that sells Viagra. He holds lesser amounts -- more than $10,000 worth -- of Dell computers, Microsoft and two media concerns, Gannett Co. and the Washington Post Co.
He has a $100,000 stake in Legend International Air, an aviation concern that, according to press reports, bought a $133 million jumbo jet from Singapore Airlines in 1996.
The report doesn't require him to detail it, but Los Angeles County records also show Schwarzenegger owns two palatial residences on the west side of Los Angeles.
One is a compound of three large homes on five wooded acres near Will Rogers State Park in Pacific Palisades; recently, Schwarzenegger put the place up for sale for $16 million, real estate listings show.
In 2002, Schwarzenegger bought a seven-bedroom home in Brentwood Country Estates, a "guard-gated" enclave of 14 building sites in the Mandeville Canyon area of the Santa Monica Mountains.
The 12,000-square-foot home was built by Los Angeles architect Gus Duffy and sits on a 5.9-acre hilltop with sweeping views of the Pacific. The home listed for $11.9 million.
This article appeared on page A - 1 of the San Francisco Chronicle
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