After the death of Henry Mayo Newhall at the young age of 56, his widow and five sons, after taking a year to settle his estate, created The Newhall Land and Farming Company on June 1, 1883. 10,000 shares of stock valued at $100 each were distributed with 2,500 shares to Mrs. Newhall and 1,500 to each of the five sons.

The Newhall Land and Farming Company was one of three companies created out of Henry’s estate and when initially set up, it was comprised of several major ranches in California scattered between Los Angeles and Monterey counties, with a total acreage of 143,000. The company would remain a family enterprise until the late twentieth century.

The Panic Of 1893 and the Effects on A “Second Generation” Business

During the time the boys were young, and Henry was alive at the helm of his business, there was more than enough money to run the affairs of life with plenty of profit leftover and saved for the leaner years.

The first years of the company were often difficult as it suffered the effects of both external factors such as the Panic of 1893 and some of the internal problems often characteristic of “second-generation” businesses.

Unfortunately, the money that once ran one household with a lot of servants and house staff was now running 5 significant palatial estates on the same money.

Ends did not always meet during lean years, so, much of the wealth in real estate that Henry had acquired during his short life was being sold away so the sons could continue to live in the style they had become accustomed to, often well above their means.

After the death of Henry Mayo Newhall at the young age of 56, his widow and five sons, after taking a year to settle his estate, created The Newhall Land and Farming Company on June 1, 1883. 10,000 shares of stock valued at $100 each were distributed with 2,500 shares to Mrs. Newhall and 1,500 to each of the five sons.

The Newhall Land and Farming Company was one of three companies created out of Henry’s estate and when initially set up, it was comprised of several major ranches in California scattered between Los Angeles and Monterey counties, with a total acreage of 143,000. The company would remain a family enterprise until the late twentieth century.

In 1928, the St. Francis Dam, a part of the Los Angeles county aqueduct system, collapsed and sent 12 million gallons of water down the middle of Rancho San Francisco taking everything in its path with it. Most of the cattle, crops, homes, orchards, outbuildings, and the most fertile topsoil in the valley were destroyed, along with the death of several of the ranch personnel.

On December 22, 1929, only 7 weeks after the great crash of wall street, George Newhall, President of NLF at the time and the youngest son of Henry Mayo Newhall, died.

After his death, rumors began to spread about the dire financial status in which he had left the company. William Mayo, the last surviving brother, now at the age of 75 and in frail health, hired his son in law, Atholl McBean, to determine if there were irregularities.

McBean, successful in his own right, hired professional controllers to examine the books of the company which found several irregularities that left the company over 3 million dollars in debt.

The biggest problem was that the company and all of its sales and purchases were done on a cash basis. There was no accounting as to where the money went. Large salaries, bonuses, and dividends were still being paid out to family members even though the company was running significantly in debt and no one knew it.

McBean was the man who saved Newhall Land and Farming from total devastation in the 1930s. Up until that time, the families lived completely on the money they received monthly from the company.

McBean convinced William Mayo, the president of NLF at the time, that if the company were to survive in the long run, all monetary distributions had to stop immediately which, when disclosed, infuriated the entire family of course.

The life of luxury stopped immediately for many members of the Newhall family.

McBean set up new accounting systems, payments were received from outstanding notes held by the company and a $737,000 settlement was paid to the company by LA County Water and Power for the devastation of the St. Francis dam disaster.

The inflow of cash and the tightening of cash outflow in addition to many wise investments made on the various properties helped turn the company around and it was profitable again by 1935.

Upon the death of William Mayo, McBean was named president and CEO of NLF and remained as Chairman of the Board until his death in 1968 at the age of 89.

With the discovery of oil on Newhall Ranch, profits began to soar. As the company coffers started to grow, financial distributions, which had been halted for the past 7 years, began to flow again to the family members.

With California’s growth rate and the economy booming, urban development into Newhall and Saugus was inevitable. Also, with the establishment of Interstate 5 freeway coming right through the middle of Newhall Ranch, the area was perfectly suited for a bedroom community outside of Los Angeles.

With Henry’s vision of a major metropolis followed by Atholl McBean’s structured vision for the future of the company, a Master Planned community named Valencia was started in 1966 with home sales beginning in 1967.

On May 8, 1969, Newhall Land and Farming, after being a closely held family business for almost 90 years, became a publicly traded company. On the first day of trading, shares opened at $31 and closed at $43 for the day. Within a week they were trading at $51.

In October of 1970, with 20% of shares being held in public ownership, they began trading on the New York Stock Exchange with a ticker symbol of NHL.

With the overwhelming success of Valencia, Newhall Ranch is put on the drawing board. It would take 23 years of wrangling through the planning and court systems to get the first two communities of Newhall Ranch approved for development.

During the financial downturn of 2005 – 2015, many companies ran into financial difficulties and Newhall Land and Farm was no exception. A lot of, for lack of a better word, financial mumbo jumbo went on during the crisis. During that period 50% of it was bought by Lennar and LNR, then it became Land Source, then NLF filed for chapter 11, then it became another new “entity” and on July 2, 2015, it became a subsidiary of FivePoint Holdings, LLC.

In the process of all that craziness, the California Public Employees Retirement System (CalPERS) invested almost a billion dollars in one of the “entities” that was created, I am just not sure which one it was. Cal Pers ended up losing every penny of that money dollars when “the entity” filed for chapter 11 bankruptcy.

It would take a financial analyst much better than myself to really figure out what happened during that time, so I am not even going to try to explain it, I just know it happened. It was an ugly time for everyone… very few came out unscathed during that time.

The first two Villages, Mission Village and Landmark Village, were finally approved unanimously by the Los Angeles County Board of Supervisors on July 18, 2017. I was there when it happened. I watched Mr. Emile Haddad, CEO of FivePoint speak to the county supervisors and heard the gavel hit the desk for the final approval!

It was quite a moving moment for me to watch the faces and reactions of all the men and women that had worked so hard, for so long, to finally be victorious.

Groundbreaking took place shortly thereafter and seems to be progressing at a breakneck pace. I guess if I waited 30 years and spent millions of dollars trying to get it approved, I would move quickly too!

It has not been announced who the builders are or what they bought so when I know more, I will put in the details here.

As of right now, model homes are estimated to begin sometime in the first quarter of 2021 with move-in available mid-summer 2021.