When McDonald’s debuted on the over-the-counter stock market on April 21, 1965, history was made, and so were fortunes. This first fast-food IPO gilded the pedestrian business of hamburgers and fries with a patina of legitimacy. Shares soared from the debut price of $22.50 to $30 in the first day of trading.
Chief among the beneficiaries was majority stockholder Ray Kroc, 63, who instantly found his stake in the company—shares he’d once joked were worth less than a subway token—valued at a cool $33 million.
The McDonald’s corporation had teetered on the brink of bankruptcy for years as Kroc and his minions built it out, propagating facsimiles of the original San Bernardino, California, hamburger stand across the rapidly developing suburbs of America. The former salesman of multi-spindled milkshake machines and paper cups had long subsisted without a salary, and what little he did possess had been depleted when he’d divorced his first wife in 1961. (That same year he’d bought out the brothers who’d masterminded the assembly line food preparation system that was the envy of the quick-serve industry. Dick and Mac McDonald had asked for $2.7 million to walk away—one million for each brother and $700,000 to pay for taxes.)
A recent migrant to California from the Chicago area, the newly minted multimillionaire Kroc found himself vacationing not long after the IPO at the exclusive, 10,000-acre Alisal Ranch in Solvang on the Central Coast of California. At his side was his glamorous, blonde second wife, Jane, who’d once served as secretary to that most famous cowboy, John Wayne. Many celebrities frequented this converted cattle ranch, among them the dashing actor Clark Gable (who’d married his fourth wife, socialite Lady Sylvia Ashley, on the property) and movie star Doris Day.
This glorious enclave north of Santa Barbara, later immortalized in the 2004 movie Sideways, had not yet morphed into wine country, but was, in the 1960s and 1970s, home to dairies and horse farms and cattle ranches. Locals meandered the flaxen rolling hills on horseback. Long ago, prospectors had scoured the land for gold here.
When Kroc spotted an ad for a 206-acre, undeveloped slice of this paradise on the winding, 14-mile Happy Canyon Road, he didn’t balk at the $600,000 asking price. (Twenty years later, Michael Jackson would pay a reported $28 million for a nearby ranch of 2,700 acres that became infamous as Neverland.) Sight unseen, Kroc commanded his attorneys back in Chicago to complete the transaction for this secluded property.
Kroc envisioned that this oasis, north of the old stagecoach route on Highway 154 and three miles from the entrance to Los Padres National Forest, would serve several purposes: As a vacation spot for hardworking McDonald’s executives, as a research and development facility, and as headquarters for his newly formed foundation, which his advisors counseled him would offset some of the tax bill on the windfall. It would also be a suitable place for parties he’d host with the missus.
He decreed this new purchase should be called "The J & R Double Arch Ranch" and commissioned a local architect, Glenn Marchbanks Jr., to not only build out the land, but even to design a cattle brand. It featured the now-famous golden arches from the McDonald’s logo flanked by the letters J and R. The herd never materialized.
Marchbanks created several structures on this beautiful expanse: Helicopter pads; a pool; volleyball, skeet shooting, and tennis courts; and experimental kitchens. The fastidious Kroc insisted everything be deluxe. Stables were carpeted, and an air conditioned barn, featuring plush touches like piped-in music, was said to be one of the most elaborate in the country.
The centerpiece of Marchbanks’s design was a 17,000-square-foot lodge. It featured 15 bedrooms, a dining room that could seat up to 100 guests, and a 3,000-square-foot living room. Interior designer Jamie Ballard stuffed it full with French provincial antiques, Italian cabinets, and a custom 28-foot sofa covered in French-made faux fur. The parties commenced.
In the fall of 1968, a spread in Architectural Digest allowed those who would never receive an invitation to step onto the elegantly appointed property with a 14-page spread headlined "An experience in modern ranch-style living":
The house has more comforts and conveniences than most city dwellings and at the same time offers the invigorating atmosphere of the outdoors and sporting life. No effort was spared in making it a mecca for relaxation and entertainment.
To that end, food was available day and night from an elegant self-serve kitchen. But the showpiece of the creature comforts at the J & R Double Arch Ranch was a 10-foot-long, automated, self-serve bar, replete with icemaker and 12 spigots that allowed guests 24/7 access to the liquor of their desire. In the sitting room of the master suite, Ray and Jane Kroc were able to serve themselves privately from another, more modest bar.
Around the time the magazine piece appeared on the stands, though, the namesake "J" at the ranch was displaced, conveniently, by a woman with the same initial. Kroc gave Jane her walking papers and ran off with longtime paramour Joan Mansfield Smith, 26 years his junior and the wife of a McDonald’s franchisee in Rapid City, South Dakota. As soon as they obtained quickie divorces in Las Vegas, the couple married at the ranch in March of 1969, taking their vows as they stood on a gigantic, bright white polar bear rug in front of the stately stone fireplace that had been constructed from 120 tons of native stone gathered from the grounds.
Over the next few years, a private, round residence, far afield from the property’s other structures, was constructed for the new missus. The hilltop on which it sat boasted 360-degree panoramic views and a central fire pit. Locals wagged that it resembled a hamburger, but if that was true, this was a burger made from ground sirloin. Flourishes included a bathroom paneled in onyx in which hung a Cezanne.
The newlyweds didn’t live at the ranch full-time, but maintained a two-story penthouse condominium on Lake Shore Drive in Chicago, as well as a condo at the Port of Americas in Ft. Lauderdale, Florida. Kroc’s brother Bob, a research scientist with a Ph.D. in zoology who’d worked for pharmaceutical company Warner Lambert, moved to the ranch with his wife Alice in order to run the Kroc Foundation. The hamburger king gave his sibling carte blanche in crafting its mission and Dr. Kroc chose to focus on medical science, sponsoring conferences and funding peer-reviewed research projects that tackled the problems of diabetes and arthritis, which afflicted Ray, and, later, multiple sclerosis, from which their sister suffered.
Exterior panel doors at the entrance to the lodge, by artist George Mullin, reflected the nature of the foundation’s work, with hand-carved abstractions of cells, chromosomes, and the tree of life.
Scientists arrived to dissect such weighty matters, indecipherable to laypeople, as "Comparative Pathophysiology of Circulatory Disturbances" in 1971 and "Prophylaxis and Therapy of Gallstones" in 1973. And there was the "1974 Conference on Purine Metabolism and Gout."
As Bob explained in the foundation’s first annual report, "The atmosphere and remoteness of the Ranch are conducive to maximal communications among the participants who lodge together, eat together and relax together." Most conferences were capped at 20 attendees, and sessions lasted just five hours a day, he wrote: "This gives opportunity for casual talks which provide as much information exchange as the scheduled sessions."
High-tech touches made these gatherings all the more fruitful: Chalkboards that slid out from a wall on tracks, screens that dropped into place, microphones that popped up from the floor, and others that dangled from the light fixtures.
As Bob Kroc was convening great minds in science at the ranch, the company whose proceeds were indirectly funding the foundation was coming under increasing fire for the nutritional quality of its food. (Esteemed food critic Mimi Sheraton declared in New York magazine in 1974 that if she were marooned on a desert island with nothing to eat but McDonald’s, the first thing she’d do would be to drown herself.) Dr. Kroc, though, drew a line between the foundation and the corporation. On behalf of Ray, Bob deflected a steady stream of written requests from various groups and individuals asking for sponsorship from McDonald’s with terse letters informing them that this philanthropic effort was a personal charity and unaffiliated with the company.
Little is known today about the research work conducted by McDonald’s in the J & R Double Arch Ranch test kitchens, given the secretive nature of the corporation. Still, Dr. Kroc kept meticulous records on the grants made and conferences funded by the foundation—as well as inventory records of the booze used in the self-serve bar.
Starting in 1976, that bar provided an ironic backdrop for a group created by the third Mrs. Kroc. The couple had recently relocated to La Jolla, California, in order to be closer to the San Diego Padres, which they had bought a few years before. Now the ranch was just a short hop away from home. Joan wrote to her brother-in-law that she was reserving the lodge in order to gather 20 "alcohologists" from around the country. "The theme," she said, "will be alcohol abuse, the problems of recognition and how to change some of the prevailing attitudes about alcoholism." It wasn’t until years later that she revealed her interest in the subject had to do with her husband’s problems with alcohol, though the name she gave the group she created gave a clue: Operation Cork—Kroc spelled backwards. At the ranch, she held meetings with top doctors from Dartmouth’s medical school and even brought kids in for training in addiction awareness. The National Association for Children of Alcoholics, which still exists today, grew out of a gathering of experts on the grounds.
A Major League Baseball conference on the impact of addiction on the sport was convened there in November 1980. Joan had commissioned a number of dramatic films to address the subject of addiction and her latest, Dugout, had its premiere at this meeting. It starred fallen baseball great Bo Belinsky, offhandedly encountering some Little League players digging into beer after a loss.
In the years after Ray died in 1984, Joan built herself her own mansion north of La Jolla in Rancho Santa Fe and found herself no longer using the ranch in Santa Ynez. She attempted to donate the property to Ronald McDonald House Charities for use as a camp. Heiress Huguette Clark, immortalized in the book Empty Mansions, had in 1963 gifted her nearby ranch, Rancho Alegre, to the Boy Scouts; not wanting another stream of kids coming around the bend, neighbors blocked Kroc’s gift.
In 1989, Joan Kroc listed the property for sale for $14 million, intending to donate the proceeds to the charity. She quipped to a Los Angeles Times reporter, "I hope it’s sold to some crazy rock ‘n roll stars who keep the neighbors up all night."
Then she set about donating the ranch’s collection of 38 pieces of Western art to a nascent museum back in her former haunt of Rapid City, South Dakota. (Ultimately, the nearby Crazy Horse Memorial Foundation received the gift instead.)
Finally, a buyer for the ranch emerged whose life’s work couldn’t have been more diametrically opposed to Ray Kroc’s. Health mogul Gerald Kessler of Nature’s Plus vitamins purchased the J & R Double Arch Ranch in 1990 and renamed it the Circle K Ranch. It served as home to his Human Potential Foundation, which, according to tax returns, aimed to "research herbs and wildlife bio-diversity with an aim toward preserving and fostering a healthy eco-system." Quite the opposite of selling Big Macs! Kessler reportedly had the McDonald’s research kitchens turned into a gym. He died in 2015, and his widow and his children from a previous marriage continue to dispute ownership of the property. But if you drive down Happy Canyon Road today, a remnant of the Kroc days is still visible on a signpost: A small, metal set of golden arches.
Editor: Adrian Glick Kudler
Writer Lisa Napoli's book Ray & Joan: The Man Who Made the McDonald's Fortune and the Woman Who Gave It All Away was released this week. It was inspired by a sculpture in Santa Monica of a nuclear mushroom cloud by the late Pulitzer Prize-winning editorial illustrator Paul Conrad, which turned out to have been anonymously funded by the late Joan Kroc. Napoli's first book, Radio Shangri-La, is about how she helped start a radio station at the dawn of democratic rule in the Kingdom of Bhutan.