Thompson Makes Sale of a Lifetime : She’s Gone Her Own Way and Prospered as Rivals Went Bust

ALISO VIEJO — Like most home builders in Southern California, Kathryn Thompson has struggled in recent years, including a major setback in 1992 when bankers forced her to sell most of her company’s land holdings to her then financial partner, fellow developer William Lyon.

Thompson has steadfastly refused to discuss the matter, but others in the industry say that transaction stripped Kathryn G. Thompson Co. of most of its cash-producing assets.

But the former premed student and door-to-door real estate saleswoman has a keen head for business, development insiders say. She has survived and prospered--becoming one of the most prominent businesswoman in Orange County--while many of her peers have folded.

“We were talking a couple of years ago about how tough things were,” said La Jolla real estate consultant Sanford Goodkin, “and she looked at me and said, ‘ There’s no way they’re going to take me down, I’ve worked too hard for this.’ ”

Last year, Thompson came back with a roar, buying 162 acres in Aliso Viejo in partnership with Los Angeles investment banker Freeman, Spogli & Co. and announcing plans to build 1,200 homes in the planned community--a four-year, $200-million project.

And on Wednesday, Thompson scored what may be her biggest business coup, signing papers to sell her Kathryn G. Thompson Co. to Koll Real Estate Group for about $7.5 million in cash, stock and notes.

Thompson not only handed off $5 million in debt, she picks up a seat on publicly traded Koll Real Estate’s board, remains in charge of her company--which continues under its own name as a wholly owned subsidiary--and will help develop several huge and highly visible developments, including Koll’s controversial 1,200-acre Bolsa Chica coastal project north of Huntington Beach.

Thompson, 53, is no stranger to controversy: a powerhouse in the Orange County Republican Party for 20 years, she astounded fellow party members by backing former entertainer Sonny Bono against the county GOP’s favorite, conservative commentator Bruce Herschensohn, in the 1992 Republican Senate primary. She also violated the GOP rule against abandoning incumbents, supporting moderate Judith Ryan’s 1992 primary challenge of Rep. Robert K. Dornan of Garden Grove.

But she really declared her independence by breaking completely with the party and actively boosting Democrat Bill Clinton’s presidential candidacy that year.

Thompson still is widely reviled in county GOP circles for what many party loyalists consider an act of treachery. This was from a woman who gave more than $100,000 to GOP candidates in 1988. The decision to back Clinton cost her the friendship and business partnership of home-building mogul William Lyon--who had long been regarded as her mentor.

She told a Times reporter in March, 1992, that her support of Clinton had resulted in “threats and innuendo and pressure.” She still complained privately late last year that Orange County’s largely Republican business hierarchy seemed bent on punishing her financially for backing a Democrat.

True to her maverick nature, she remains both a registered Republican and a Clinton supporter.

Thompson said Thursday that she has been asked by the Administration to serve on several federal boards and to consider appointment to a Cabinet-level post but has declined each advance because she has no political ambitions.

Thompson’s husband, Gus Owen--an Orange County commercial real estate investor and longtime Republican stalwart--has accepted a Washington job from the Clinton Administration, however. In May, Owen was appointed to the Interstate Commerce Commission.

Thompson’s future empire had its roots in baby-sitting jobs. As a teen-ager she took $500 in savings and made a down payment on a run-down house in Dallas. After refurbishing it with help from her father, a Texas policeman, Thompson rented out the home--the monthly income helped her pay the tuition at Southern Methodist University.

Thompson started college as a premed student but later changed to business. During college she worked first at Texas Instruments as an engineering assistant and later at a Ford Motor Co. regional office as a personnel administrator.

Her first marriage brought her to Orange County in 1964, when her husband enrolled in college in Fullerton, and she spent a year with a mechanical engineering firm there. But she decided that real estate was where she could make her mark.

Her first real estate job involved going door to door to ask people to list their homes. But she also met a broker named John Seymour, who helped introduce her to the county’s Republican Party leadership. Seymour later became mayor of Anaheim, a state senator and U.S. senator and now is director of the California Housing Finance Agency.

In 1967, Thompson started her first company, New Dimension Inc. in Santa Ana, which specialized in buying and refurbishing apartments. That led to apartment building and, in 1985, to the founding of her home-building business.

By the late 1980s her company was flourishing, and in 1991 she became the first woman inducted into the California Building Industry Assn. Hall of Fame.

Through the years, Thompson has shared her energies with a number of charities and arts programs: she teamed with William Lyon to raise $8 million for the Orangewood Children’s Home for abused children, is a member of the Orangewood Foundation board and has sat on the boards of United Way, the Boy Scouts of America, Orange County Performing Arts Center, Opera Pacific, Children’s Hospital Foundation and UCI College of Medicine.

As for the latest chapter in her saga, Thompson is sanguine about selling her business.

“It really won’t be much change for the company or for me,” she said. “I’ll still be running things, and as long as I make profits that won’t change.”

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Times staff writer Debora Vrana contributed to this report.