By Ethan Smith
LOS OLIVOS, Calif. — After he was acquitted of child molestation charges in 2005, associates say, Michael Jackson vowed he would never return to Neverland.
The 2,600-acre estate, named for a magical place where children never age, has since yielded to reality and time. The amusement-park rides, elephants and orangutans have been hauled away. The two helicopter landing pads are empty. The private railway line stands idle and the ornate “Neverland” gates that framed the driveway are in storage. Bats hang over the doorway to the building that housed Mr. Jackson’s private arcade; guano stains the threshold.
But now the ranch is playing a role in an effort to rehabilitate Mr. Jackson’s finances. Since January, more than 80 workers have been toiling at the ranch as part of a plan by real-estate investment firm Colony Capital LLC to convert the former money pit into a lucrative asset. The company has spent more than $3 million on landscaping and repairs to the property’s electrical and plumbing systems. Soon Colony plans to bring in a small herd of Clydesdales to show visitors some signs of life on the all-but-abandoned estate.
Kyle Forsyth, Colony’s project manager, describes the estate’s Tudor-style buildings and savannah-like grasslands as “English country manor meets Kenya.” Eventually, Colony hopes to sell the ranch, located in Santa Barbara County, in its entirety. Subdividing it, says Mr. Forsyth, “would destroy it.”
The state of Neverland is a reminder of the excesses that precipitated Mr. Jackson’s financial decline. In his years at the ranch, he stuffed it with items ranging from antique furniture to arcade-style videogames. After he was twice accused of molesting boys on the property, he had to shell out for high-priced legal teams. No criminal charges were brought the first time around, in 1993, and he reached a settlement in a civil lawsuit. In the second case, he was acquitted of criminal charges in 2005.
The 50-year-old singer’s debts now stand at around $500 million, according to three people familiar with his finances. The value of Mr. Jackson’s biggest assets — music copyrights that include 251 Beatles songs as well as his own compositions — probably still exceed his growing debt, according to these people. Mr. Jackson’s manager said the singer wasn’t available for comment.
Last spring, Mr. Jackson defaulted on a $24.5 million loan backed by the ranch. Los Angeles-based Colony bought the note for $23 million and put the title into a joint venture it formed with the singer.
As Neverland is brought back to life, concert promoter AEG Live is trying to resurrect Mr. Jackson’s music career. He is booked to play 50 shows at London’s O2 arena over several months starting in July. If all goes according to plan, Mr. Jackson could make as much as $50 million, according to people familiar with financial details of the shows. Adding dates in Europe, Asia and North America could net him $400 million, these people say.
But Mr. Jackson has already delayed the first four shows in London, citing a need for additional dress rehearsals. In April, he pulled out of a plan to auction most of the personal effects and furnishings from Neverland. And he recently parted ways with Tohme Tohme, a Colony Capital business associate who for several months acted as his manager, striking the deals for the Neverland joint venture, the auction and the London concerts. Taking Dr. Tohme’s place is Frank DiLeo, Mr. Jackson’s manager from 1984 to 1989. Mr. Jackson didn’t offer an explanation for the change, according to associates notified about it.
Amusement-park rides have been removed by Neverland’s new owners.
As it attempts to turn Neverland into a salable property, Colony is trying to walk a fine line between removing the taint of scandal while preserving enough of Mr. Jackson’s quirks to remind potential buyers why the property is so famous in the first place.
Before it puts the estate on the market, Colony plans to change its name and allow local charities to use it to host fund-raisers.
“We think we made a very smart real-estate deal that was to the benefit of Michael and Colony,” says the real-estate firm’s chief executive, Tom Barrack. He believes the estate could fetch $70 million to $90 million, in which case Mr. Jackson could also realize a tidy profit. “Should Michael Jackson’s career be reaccelerated, it will have substantial additional value.”
The property now known as Neverland was built in 1981 by real-estate developer William Bone, who named it Sycamore Valley Ranch. The main house’s 13,000-square-foot interior is still trimmed in the oak paneling installed by Mr. Bone.
Mr. Jackson paid $19.5 million for the ranch in 1987 and rechristened it Neverland.
Among the $35 million worth of amenities he added were enough amusement-park rides for a state fair, a zoo, a go-kart track and two separate railway lines — one large enough to accommodate full-sized antique steam engines.
A 50-seat theater features state-of-the-art projection and sound systems, a private viewing balcony, and a stage that includes trap doors for magicians’ assistants. Mr. Jackson converted a rustic red barn into a herpetarium with displays for a dozen exotic and venomous snakes, including a Burmese python and a monocled cobra. He created a Neverland Valley Fire Department, with a small fleet of working engines and full-time firefighters who were occasionally dispatched to battle brushfires on neighboring properties.
At its peak, Neverland boasted a staff of 150, and cost $10 million a year to maintain, according to people familiar with the matter.
Mr. Jackson spent more than 15 years living at the ranch. He wrote songs for 1991’s “Dangerous” album while sitting in a treehouse overlooking the estate’s four-acre pond. His three children were home-schooled on the third floor of the main house.
Mr. Jackson also used the property for guests, ranging from attendees of high-priced fund-raisers to local school kids and children with cancer or other serious illnesses. The property’s theater was built with two isolation rooms so that immune-compromised chemotherapy patients could watch movies without being exposed to other children’s germs.
After being acquitted of the criminal charges in a 2005 jury trial in nearby Santa Maria, Mr. Jackson left Neverland for destinations that included Dubai, Bahrain and London. People close to the singer say he didn’t return to Neverland largely because he felt traumatized by the events surrounding his arrest and trial.
Last fall, Mr. Jackson moved to Los Angeles’ high-end Hotel Bel Air from the Las Vegas area. In a bid to save money, he settled into a nearby $100,000-a-month rental property in January, according to Dr. Tohme.
While Colony seeks to remove some reminders of Mr. Jackson’s tenure, company executives recognize that the singer’s imprint remains. Mr. Forsyth says express-mail delivery drivers stopped taking packages to the property when they were addressed to “Sycamore Valley Ranch,” because they didn’t recognize the name. For official correspondence, the ranch for now is called “Sycamore Valley/Neverland.”
In one corner of the property sits Mr. Jackson’s old tour bus: a mustard-yellow recreational vehicle with six-foot-high portraits of the Three Stooges painted on the outside. The Victorian-style “train station” has been restored. A stone-and-flower rendering of Mr. Jackson’s logo for the property — a child’s silhouette, seated on a crescent moon — still adorns a hillside. The company hasn’t decided whether to scrap an elaborate fort and a make-believe “Indian village.”
“You can’t wipe out Neverland entirely,” says Mr. Forsyth. “It’s part of the history of the place.”
Write to Ethan Smith at ethan.smith@wsj.com
Source: http://online.wsj.com/article/SB124484259109711019.html
MJ 
This is really sad, but Michael Jackson’s money problems just goes to show that even celebrities are human–we all face problems, even financial ones.
Cool!