Your statement, which is just accepting an internet-rumor as true, contrasts very strongly with the article itself, which is about going to great effort to learn things from hard data.
Even a simple typo or difference in conventions at the time of data entry will obfuscate that multiple parcels are owned by the same entity.
The article's method simply performs exact matches on owner_name, which is a place to start. It makes no attempt to delve deeper to piece together the true ownership structures that this data represents, an admittedly far harder problem.
There are non-tax benefits, such as bypassing probate, but as the value of a property increases the 1% property tax becomes increasingly worrying. I suspect this is part of the reason why it's more common with commercial real estate.
The goal is to avoid tax reassessment when a property is sold, which is a big deal since the average price of a house in CA in 1940 was $36,700 and is now $211,500 (and much, much higher in places like Los Angeles and San Francisco). Even at the average house price, it's the difference between a $367/yr bill versus a $2,115/yr bill. Presumably commercial real estate has seen an equivalent rise over time.
http://www.boe.ca.gov/proptaxes/leopcio.htm
I wonder if it frequently just isn't worth unwinding the corporation.