Article: Beach Boys 3 Million Dollar,435 Acre Real Estate Deal, August 1967

[guitarfool2002]

I found this article doing some research, and wondered if anyone knew what became of this land or any other details about this transaction. August 1967...3 million dollars...that was an enormous amount of money considering the myriad of other projects they had going at this time, including Brother Records, the home studio, and the Hawaii trip. Just curious.

[Alex]

I think Steven Gaines wrote about it in his book.

[guitarfool2002]

I think Steven Gaines wrote about it in his book.

Ok...so he did, but I thought it would be interesting to see the actual newspaper report from when it went down! It was important enough to make the local paper in 1967. 

Note: Gaines mentioned the figure of $250,000 with Brian investing then owning 62 percent of the interest in the deal for putting up most of the money. The article from when the deal was being made states the deal was for 3 million...250,000 is far less than 62 percent of a 3 million deal. Gaines also mentions the 5-year tax loophole for real estate investments being exploited by Nick Grillo, and the article says nothing will be done with the land for 5 years, so that adds up on both accounts. But where is the rest of the 3 million if Gaines reported the deal was far less?

The Gaines book mentions several real-estate deals, but seeing the figure of 3 million, in terms of August 1967 dollars especially in light of the financial problems around the corner for this band and "Brother Ltd.", is a staggering amount of money to invest. What exactly was their yearly income as a company if they could spend like this in late '67?

[Cam Mott]

Maybe Gaines is talking about the money they put down?

[guitarfool2002]

Maybe Gaines is talking about the money they put down?

Yes, I didn't even think of that, the down money! That would make sense, and Gaines also mentions Brian having to later write checks from his own accounts in order to make the regular payments which "Brother Inc." was having a hard time paying.

So this deal according to Gaines fell apart in 1970.

So average rounded figure...approximately what did the Boys and/or Brother earn in 1967? If such a figure is even available.

[juggler]

So average rounded figure...approximately what did the Boys and/or Brother earn in 1967? If such a figure is even available.

Never heard actual figures, but they were clearly filthy rich by 1967 standards.  Relatively speaking, the music industry was much more lucrative in those days than now.  I was struck by the Smiley Smile ad indicating that the album could be yours for "only $4.98."   That was in an era when a loaf of bread cost $0.20.  If music prices had moved in tandem with the Consumer Price Index, a new album would now cost $75.

[Cam Mott]

Google Maps shows the area to still be mostly agricultural.

[Andrew G. Doe]

So average rounded figure...approximately what did the Boys and/or Brother earn in 1967? If such a figure is even available.

Never heard actual figures, but they were clearly filthy rich by 1967 standards.  Relatively speaking, the music industry was much more lucrative in those days than now.  I was struck by the Smiley Smile ad indicating that the album could be yours for "only $4.98."   That was in an era when a loaf of bread cost $0.20.  If music prices had moved in tandem with the Consumer Price Index, a new album would now cost $75.

The income stream in 1967 was still substantial - Pet Sounds and Best Of... had done very nicely, they'd had two huge singles and the back catalog was still selling some, plus the royalties always take time to work through the system. The band didn't really start hurting for money until 1968, when the Maharishi tour, which they financed, was cancelled after five dates.

[guitarfool2002]

Google Maps shows the area to still be mostly agricultural.

It's interesting to hear that, since it seemed at the time to be hot parcel of land just waiting to be split up and developed. Some 44 years later it's still as it was.

Noticing the paper was from Oxnard California struck me too, because my Dad was stationed in Oxnard with the Navy in 1944-45 before they sent him to Saipan. You always wonder how much has changed in an area over time.

[jabba2]

The Heroes and Villians book talked about this specific deal, Nick Grillo hooked them up and I think the idea was to flip the land at a profit at a later time. But something got in the way i cant remember what happened. But the Beach Boys blamed Grillo for it, who in retrospect according to the book, was one of thier better managers. They lost most of thier investment I'm pretty sure.

[guitarfool2002]

The Heroes and Villians book talked about this specific deal, Nick Grillo hooked them up and I think the idea was to flip the land at a profit at a later time. But something got in the way i cant remember what happened. But the Beach Boys blamed Grillo for it, who in retrospect according to the book, was one of thier better managers. They lost most of thier investment I'm pretty sure.

I paraphrased some of the story from Gaines' book above - it could have been a pretty good deal since Grillo found a loophole in the tax laws at the time which allowed them to wait 5 years and have some kind of exemption or something loophole-like where they'd profit on it. Unfortunately it seems the band's fortunes changed dramatically from the time of this news article when they seemed to be raking in the cash, to when the actual payments came due and the loans were getting called in just a few years later when they weren't making as much money.

Brian had to bail them out with his own money, writing checks from his personal account to cover it.