February 26, 2024

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Real Estate newsletter: Feds try to seize a Holmby Hills mega-mansion

Welcome back to the Real Estate newsletter. It’s been a juicy week on the luxury beat, and our top stories have a little bit of everything: bribery allegations, celebrity, eye candy and a little dose of dangerous ambition.

First, alleged bribery. When a Holmby Hills mega-mansion a few houses down from the Playboy Mansion surfaced for sale at $63.5 million, it seemed like just another luxury listing. But federal prosecutors moved to seize the estate, alleging that its owner, a powerful Armenian politician, bought the 33,652-square-foot showplace with bribe money.

We spoke to the listing agent, who said despite all the drama, the home is still up for grabs.

Second, celebrity. The week’s biggest headlines centered on a pair of high-profile sales — one post-move and one posthumous.

The post-move deal was done by Adam Levine, who relocated into Rob Lowe’s $52-million Montecito mansion in March. A couple of months later, the Maroon 5 frontman unloaded his Pacific Palisades estate for $51 million, making it one of the priciest transactions in the history of the coastal community.

The posthumous deal was done by Alex Trebek — actually his widow, Jean — who sold the late “Jeopardy!” host’s longtime home in Studio City for $6.45 million. Trebek owned the place for nearly 30 years before his death in 2020, and the 1.5-acre spread is about a 30-minute drive from the Culver City studio where the game show is filmed.

Third, eye candy. The biggest “gotta-click-for-the-pictures-alone” story of the week belongs to Roger Vincent’s tour of Riot Games, the game developer responsible for the hugely popular “League of Legends.” The sprawling headquarters in West L.A. is a gamer’s paradise complete with a dining hall that’s free for employees, an auditorium built for esports competition and a coffee shop designed to resemble Bilgewater, a mythical port city from the hit game.

Lastly, dangerous ambition. The tale takes us back to 1998, when a landslide caused several homes to slide down a rain-soaked hillside. Houses were destroyed, condos were damaged, and now, a developer is looking to build a condo complex on the same site 24 years later. Needless to say, residents have concerns.

As always, while catching up on the latest, visit and like our Facebook page, where you can find real estate stories and updates throughout the week.

Feds look to seize mega-mansion

A mansion in Holmby Hills has a pool and lawn in front and is surrounded by tall hedges.

A French chateau-style mansion in Holmby Hills has 11 bedrooms, 27 bathrooms, and an asking price of $63.5 million.

(Hilton & Hyland
)

For sale: a French chateau-style mansion in one of Los Angeles’ most exclusive neighborhoods, Holmby Hills, complete with 11 bedrooms, 27 bathrooms and an asking price of $63.5 million.

At 33,652 square feet, it is among the largest homes on the market in Southern California, but there are a few hitches. For one, the interior is not yet finished. And, this week, federal prosecutors in Los Angeles moved to seize the estate, alleging that it was the fruit of corruption involving a powerful Armenian politician and his children.

The U.S. Department of Justice outlined in a court filing how the property on South Mapleton Drive — a few doors down from the Playboy Mansion — was purchased in 2011 for $14.4 million with bribes to the family of Gagik Khachatryan, Armenia’s former minister of finance, from a prominent businessman there.

Khachatryan, 66, his two sons and the businessman are all facing criminal charges in Armenia; the businessman is accused of providing more than $20 million in bribes.

Adam Levine fetches a fortune in the Palisades

A plant-covered roof is among the buildings shown on a property in Pacific Palisades.

The three-acre spread includes a ranch-style home, four-bedroom guesthouse, gym, yoga studio, swimming pool and chicken coop.

(Anthony Barcelo)

Maroon 5 frontman Adam Levine quickly found a buyer in Pacific Palisades, selling his prized compound for $51 million. It’s Southern California’s third-priciest home sale this year and one of the biggest deals ever in the coastal community.

Levine and his wife, model Behati Prinsloo, bought the park-like estate from Ben Affleck and Jennifer Garner for $31.95 million in 2018 — so the sale marks a huge profit for the power couple. Over the years, other high-profile owners included “To Kill a Mockingbird” actor Gregory Peck and Oscar-winning producer Brian Grazer.

Spanning three acres, the compound features three structures: a 9,000-square-foot ranch-style home, a four-bedroom guesthouse and a separate building with a gym, office and yoga studio. Midcentury architect Cliff May designed the ranch, which mixes chic, modern design with luxury amenities, including a Dolby movie theater, game room, marble bar and walk-in refrigerator.

‘Jeopardy!’ host’s home trades hands

The front of a two-story home opens onto a vast lawn.

Alex Trebek’s Studio City estate includes five bedrooms, nine bathrooms and a handful of lavish living spaces.

(Compass)

Alex Trebek’s Studio City estate — which the late “Jeopardy!” host owned for three decades until his death in 2020 — has been sold for $6.45 million.

That’s exactly triple the price Trebek paid in 1991 when he bought it for $2.15 million, records show. His widow, Jean, listed the home for $7 million in January. His daughter, Emily Trebek of Compass, handled the sale.

The $6.45-million deal ranks as Studio City’s second-priciest home sale this year, and that tab should come as no surprise. The 99-year-old home spans 10,000 square feet and sits on 1.5 acres in Fryman Estates, one of the neighborhood’s most expensive pockets.

Inside are five bedrooms, nine bathrooms and a handful of lavish living spaces. There’s a two-story entry with dual staircases, a lounge under a dramatic rotunda and a gold-and-white wet bar.

Riot Games’ L.A. home is a gamer’s haven

Two men sit at a long bar inside a coffee shop in Riot Games' headquarters.

A coffee shop inside Riot Games’ expanded West L.A. headquarters is themed after a city in its “League of Legends” game.

(Allen J. Schaben / Los Angeles Times)

Riot Games’ headquarters on Olympic Boulevard in West L.A. is nearly invisible to passersby, much of it a discreetly walled-off campus where security is tight to safeguard work that can mushroom far beyond gaming into the riches promised by TV and film, writes commercial real estate reporter Roger Vincent.

The Times got a rare look inside Riot Games’ newly expanded home base, which gives off distinct movie studio vibes. Here are the highlights.

  • Three theaters, two of which were previously used by legendary movie directors James Cameron and George Lucas.
  • A dining commissary called Noms that includes one of the biggest commercial kitchens on the Westside, serving a wide range of fare that changes daily and is provided free to the company’s 3,100 employees.
  • A re-creation of a Korean gaming hall called PC Bang, where employees can play multiplayer computer games such as “League of Legends” — without the hourly fee that gaming hall patrons must pay.
  • Giant statues of Annie and Tibbers, characters from “League of Legends.”

And much, much more.

Developer looks to build on site of devastating landslide

An aerial view of two homes in Laguna Niguel that collapsed down a hillside.

An aerial view of two homes on Via Estoril in Laguna Niguel that fell in 1998 when a rain-soaked hillside collapsed.

(Geraldine Wilkins–Kasinga / Los Angeles Times)

In 1998, after a winter of heavy rains, the hill below Via Estoril collapsed in Laguna Niguel. Several homes slid down, others were destroyed, and the condominiums below were heavily damaged, writes Hannah Fry.

Now, a developer is proposing new condominiums at the base of the hill. Improvements made since the landslide will prevent disaster from striking again, the project’s proponents say.

Residents, however, fear the new project will destabilize the hill and send it crashing down again.

What we’re reading

As the California real estate market jumps away from the middle class, the concept of paying-it-forward is making its way into housing. Fortune tells the story of a Silicon Valley woman whose house is worth more than $1 million but decided to sell it to a trust for half its market value as part of an “age-in-place” initiative that lets longtime owners stay in their homes while the trust deals with upkeep. When she dies, the prized property will be turned into affordable housing.

Enough words. If you made it this far, I offer an interactive map from MarketWatch. It tracks housing availability across the country and found that inventory in L.A. County has gone down 25% since 2017. The drop-off gets even more dramatic up and down the coast, with Orange County’s inventory falling 38%, Ventura County’s falling 45% and Santa Barbara County’s falling 56%.

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Real Estate newsletter: Who dropped $141 million on The One?

Welcome back to the Real Estate newsletter. All good things must come to an end, and this week saw what might be the final chapter in a long, drawn-out saga that brought some of the juiciest drama that the Southern California housing market has seen in years.

In a way, it’s almost sad. Watching the filthy rich wrestle over “The One,” the biggest modern home in America, has been a constant source of schadenfreude over the last decade. But that’s over now, because the mega-mega-mega-mansion has been auctioned off to the highest bidder, and The Times was the first to find the buyer: Fashion Nova owner Richard Saghian.

It makes sense that the glitzy, glamorous home would sell to Saghian, a fast-fashion mogul who grew the juggernaut brand through collaborations with influencers such as rapper Cardi B and model Kylie Jenner. Saghian spent $141 million on the mansion, which is by far the most ever paid for a home at auction.

And so we say goodbye to “The One” and its ever-flowing source of headlines, which saw L.A.’s most ambitious developer erect a 105,000-square-foot palace only to lose the prized property to his many lenders, who fought over its future and eventually decided to recoup their losses by selling it off for significantly less than they were owed. Along the way, we saw the developer hatch scheme after scheme. At one point, he pitched turning the residential property into a boxing venue. Later, he tried creating a cryptocurrency backed by the house itself.

Perhaps Saghian will try a zany scheme of his own with the home. Until then, we bid farewell to the infamous property.

Out in Hidden Hills, another prized compound surfaced for sale: Drake’s “Yolo Estate.” The hip-hop star dropped more than $70 million on a Beverly Crest home last month, and weeks later, he listed his party property complete with three homes, two pools and a mechanical bull for a combined $22.2 million.

Moving on to news you can use, as this week was filled with relevant legislation for L.A. renters and homeowners.

For starters, The Times looked into the implementation — or lack thereof — of Proposition 19, which was passed in 2020 and gives older California homeowners tax breaks when they move. Many eligible owners have been shocked by their pricey property tax bills, though, because the L.A. County assessor’s office still hasn’t completed any of the 1,271 applications it has received nearly a year after the law took effect.

For renters, L.A. City Council members are considering a package of renter-protection measures that would help promote fair access to housing by not allowing landlords to screen prospective tenants using criminal, eviction or credit histories.

Speaking of renting, we also ran down what you need to know about rent control if you’re building an ADU. Based on location and when your house and the ADU were built, the units may be subject to rent-control rules. Take a peek to see if yours would be affected.

While catching up on the latest, visit and like our Facebook page, where you can find real estate stories and updates throughout the week.

The One’s mystery buyer is revealed

Richard Saghian and Meek Mill attend Fanatic Super Bowl party

Richard Saghian and Meek Mill attend the Fanatic Super Bowl party on Feb. 12 in Culver City.

(Shareif Ziyadat / FilmMagic)

Richard Saghian, owner of fast-fashion behemoth Fashion Nova, was the winning bidder who spent $141 million to buy “The One” mega-mansion.

Saghian, whose company has benefited from its association with celebrities and influencers such as pop superstar Lil Nas X, beat out four other bidders for the unfinished Bel-Air hilltop manse — the largest home in Los Angeles.

“The One,” which already has been rented out for filming, is the magnum opus of flamboyant developer Nile Niami. He initially marketed the home for $500 million several years ago but was forced to put it into bankruptcy after Crestlloyd, the home’s limited liability company, defaulted on $106 million in construction loans to L.A. billionaire Don Hankey.

Although some in the L.A. real estate community have dismissed the residence as garish, others have seen it as the ultimate trophy home — with a list of amenities aimed at the party set. There is a sky deck with cabanas, multiple pools, a private theater, a bowling alley, a billiard room, a candy room, and salon and spa as well as a nightclub. It has 21 bedrooms and 42 full bathrooms.

Drake buys a mansion, lists another

The 6.5-acre compound includes two ranches and an amenity-filled mansion called the "Yolo Estate."

The 6.5-acre compound includes two ranches and an amenity-filled mansion called the “Yolo Estate.”

(The Beverly Hills Estates)

In February, Drake turned heads when he dropped more than $70 million on a trophy home in Beverly Crest. The blockbuster deal marked the end of a yearlong house hunt that saw the rapper make his first move into the Los Angeles area.

A week later, the Grammy-winning hip-hop star is going on a selling spree, shopping around three homes he owns in the quiet, star-studded community of Hidden Hills for a combined $22.2 million.

Drake has been compiling the compound for a decade, first buying an English Tudor-style mansion for $7.7 million in 2012. He purchased the ranch right next to it for $2.85 million in 2015, and three years later, he picked up another neighboring ranch for $4.5 million, creating a triple-lot estate that spans 6.5 acres.

The crown jewel of the compound is the “YOLO Estate” — slang for “you only live once” — that Drake transformed into a party house during his stay. Rustic on the outside with Tudor-style flourishes, the home opens to 12,500 square feet of dramatic spaces with seven bedrooms, nine bathrooms, six fireplaces, a wine cellar, tasting room, bar, recording studio and movie theater.

Older homeowners suffer as tax benefits stall

Rose Liebermann, 71, left, and her daughter Natasha Gershon, 36, in their home in West Hills

Rose Liebermann, 71, left, and her daughter Natasha Gershon, 36, in their home in West Hills. Liebermann recently opened her property tax bill and immediately felt dizzy. The amount she owed on her West Hills home was almost four times higher than her previous home in Granada Hills where she had lived for more than 30 years.

(Genaro Molina / Los Angeles Times)

Rose Liebermann opened her property tax bill and did a double take, writes Ben Poston.

The $15,584 she owes on her new West Hills home is almost four times as much as the taxes on her previous house in Granada Hills, where she had lived for more than 30 years.

It wasn’t supposed to be that way. Proposition 19, narrowly approved by California voters in 2020, gives older homeowners a property tax break when they move. Specifically, it allows those 55 and older to blend the taxable value of their previous home with the value of a new, more expensive home they purchase, resulting in significant property tax savings.

But processing delays at the Los Angeles County assessor’s office have left property owners like Liebermann facing hefty tax bills that must be paid while they wait for their applications to be approved.

Nearly a year after the law took effect, the assessor’s office has not completed any of the 1,271 applications it has received to recalculate the property taxes for older and disabled homeowners under the law.

Possible renter protections on the way

A large apartment is advertised for rent in Pasadena in 2019.

A large apartment is advertised for rent at California Boulevard and Oakland Avenue on in Pasadena in 2019.

(Gina Ferazzi / Los Angeles Times)

Three Los Angeles City Council members introduced a package of renter-protection measures they say would help promote fair access to housing amid the city’s worsening homelessness crisis, writes Julia Wick.

The motions introduced Wednesday by Council Members Mike Bonin, Marqueece Harris-Dawson and Nithya Raman would significantly restrict what kind of information landlords can seek from prospective tenants.

The proposed ordinances would prohibit screening prospective tenants on the basis of their criminal, eviction or credit histories. Landlords would also be required to publicly display uniform rental criteria before renters pay application fees.

“It’s about making it easier for people to get housed and stay housed” amid the homelessness crisis and evictions that will come if pandemic-era tenant protections are repealed, Bonin said.

Could your ADU be rent-controlled?

Landlord and architect Alexis Navarro stands in front of his "Casita L.A.," a new ADU he designed in East L.A.

Landlord and architect Alexis Navarro stands on Feb. 6 in front of his “Casita L.A.,” a new ADU he designed in East L.A. in the carport of an existing three-unit property. Navarro designed and built the 500-square-foot ADU over five months for $95,000.

(Allen J. Schaben / Los Angeles Times)

Hoping to boost the supply of housing, California has made it far easier for homeowners to build accessory dwelling units, better known as granny flats or ADUs, writes Jon Healey. But an ADU could bring an unexpected wrinkle to your property along with the new tenants: rent control.

A new ADU probably wouldn’t be covered by rent control unless it was in the city of Los Angeles, where an emergency COVID-19 order has temporarily frozen rents on all properties. But a limit on rent increases could go into effect immediately on a single-family house on the same lot as a new ADU, even if it previously had been exempt.

In some cities, the house would also be subject to restrictions on evictions and other tenant protections.

What we’re reading

Although there might not be many homes on the market, there are still plenty of empty homes. The New York Times took a look at the 2020 census and found that nearly 10% of U.S. homes were “vacant” at the time. Due to the sheer number of homes in our populous state, California has one of the biggest vacancy totals in the country at 1,248,000 homes, but its vacancy rate is one of the lowest at 9%.

Modern home buyers have to compete with a growing number of investors and developers flooding the market. But a new tax bill would target those players in an attempt to make the market more fair for individual buyers. Called the California Speculation Act, the bill would impose a 25% tax on a home resold within three years after it’s bought, which specifically targets house flippers. The San Diego Union-Tribune has the details.

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