Home Development Where Prices Start at $115 Million: Bel Air’s Trophy Home Boom

Where Prices Start at $115 Million: Bel Air’s Trophy Home Boom

621
0
SHARE

In a new development of three spec homes in the tony Los Angeles neighborhood of Bel Air, one property will have a 15,000-square-foot guesthouse. Another home has plans that call for a “Champagne room,” a chilled, glass rotunda with walls filled with bubbling liquid. A third home will have a 2,100-square-foot spa with separate steam and massage rooms.

The only thing missing: a crowd of buyers who can afford to live in them. The Park Bel Air, the 11-acre development currently under construction, has asking prices that start at $115 million—and go up to $150 million with upgrades and custom furnishings.

“There are probably only about 3,000 people [in the world] who can afford this,” says Barry Watts, the Los Angeles-based president of Domvs London, the Park Bel Air’s developer. The buyer “needs to be a billionaire.”

In Los Angeles, the latest trophy homes—many of them speculatively built —may top the $100 million mark. Sales at eye-popping prices have been fueled partly by wealthy international buyers who traditionally shopped for second homes in places like New York, London or Monaco, but have lately turned their sights on Los Angeles.

Currently there are more than four dozen homes on the market in the L.A. area priced above $20 million, and the priciest trophy homes seek over $50 million. The most ambitious of the projects: A spec home under construction in Bel Air will hit the market when it’s completed next year with an unprecedented asking price of $500 million, according to its developer, Nile Niami.

Still, while demand in L.A. remains strong, real-estate experts note that ultrahigh asking prices are seldom the sale prices. Instead, stratospheric pricing is often more of a marketing ploy than an attempt to place a real value on a home, says Jonathan Miller, head of New York-based appraisal firm Miller Samuel. “It’s almost as if there is no shame in wildly overpricing a listing anymore,” he adds.

Stephen Shapiro, chairman of Westside Estate Agency and the listing agent for the homes in the Park Bel Air, says the location and size of the properties justify the prices. The homes will range from 58,000 square feet to 66,000 square feet and are on unusually large lots in the flat section of Bel Air, but have views more typically found in hillside homes.

Fewer than 10 U.S. homes have ever sold for $100 million or more, according to Mr. Miller, including just three in the state of California. The priciest was the 2012 sale of a $117 million property in Woodside to Softbank CEO Masayoshi Son, according to the Los Angeles Times.

If Mr. Niami’s $500 million home sells at even a 50% discount, it would top what is thought to be the most-expensive home sale: $221 million paid in 2011 by Ukrainian billionaire Rinat Akhmetov for a penthouse in London’s One Hyde Park condominium.

In Los Angeles, the highest known price paid for a private home is $102 million for Fleur de Lys, a 41,000-square-foot furnisehd mansion modeled after a French château that sold earlier this year. The home had been on the market with an asking price of $125 million since 2007.

LEAVE A REPLY