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The Real Deal Los Angeles

A group of LA investors paid over $1M for a ghost town— on Friday the 13th

They plan on rehabilitating the Old West mining town 200 miles from LA
By Natalie Hoberman | July 13, 2018 02:00PM

Cerro Gordo, the “ghost town”.

The sale of a 300-acre property in a historic “ghost town” outside of Los Angeles closed on Friday the 13th after a bidding war, with its new owners vowing to make it a lively hospitality destination.

Cerro Gordo, an abandoned mining town 200 miles from L.A. that looks as eerie as HBO’s “Westworld,” sold to a group of eight Los Angeles-based investors for between $1 million and $1.5 million, about a 40 percent bump from its $925,000 asking price, The Real Deal has learned.

The buyers are Brent Underwood, a hospitality entrepreneur and best-selling author, and Jon Bier, who runs a boutique public relations firm. Underwood declined to comment on the exact price.

Built in the 1860s, Cerro Gordo is rich with history, and has been left relatively untouched as it passed through a few generations of family ownership.

It features 22 structures totaling 24,000 square feet, and includes a historic hotel, bunkhouse, saloon, chapel and museum. The town, once known to produce most of L.A.’s silver and lead, epitomized the Wild Wild West. At one time, there was a murder a week there, Business Insider reported.

Underwood and Bier teamed up with minority investors for the project. They include talent manager Aaron Saltzman, former American Apparel executive Ryan Holiday, Four Sigmatic founder Tero Isokauppila, Epic Signal founder Brendan Gahan, restaurateur George Rutolo and Hulu executive Kelley Mooney.

Together, they plan on renovating the site while maintaining much of the existing structures. They expect it will be used for weekend getaways, festivals, photoshoots and writing retreats, Underwood said.

Underwood, who first heard about the property after his friend sent him an an article about it, said he’d been looking for a hospitality location that was “interesting and unique, with some history to it.”

“I saw it and thought, ‘This has gotta be the one,” Underwood said. “We moved on it pretty quickly.”

The sellers — brothers who inherited the property in a family trust — received about a dozen offers, including some from investors wanting to build a marijuana farm and pine nut farm. The brothers ultimately chose Underwood’s team because of their desire to maintain the original property, Underwood said.

Jake Rasmuson of Bishop Real Estate brokered the deal.

Remote places like Cerro Gordo are continuing to gain popularity among L.A-based investors, especially millennials, who are eager to get into the hospitality business. Joshua Tree, for example, has seen an influx of investors in recent years who are looking to make a profit from the hot short-term rental market. The same is true for Coachella Valley, where several festivals keep fueling the Airbnb and rental markets.