Bel Air property that Woodbridge Group once bought from Hard Rock Cafe founder sells for $38M
The 82K sf lot was among many that Woodbridge was going to develop into luxury homes before federal authorities charged it in massive Ponzi scheme
More than two years after Woodbridge Group of Companies filed for bankruptcy, charged with operating a $1.2 billion Ponzi scheme, the former luxury real estate developer’s properties are still being liquidated.
The latest is a prime development site at 800 Stradella Road in Bel Air, which Hard Rock Cafe founder Peter Morton sold to Woodbridge in 2017.
That 82,000-square-foot lot was just sold for $37.5 million. The buyer is a Delaware-based LLC controlled by a New York-based trust. The title changed hands late last month, from an entity controlled by Frederick Chin. He was appointed last year to liquidate Woodbridge assets, in order to pay back investors defrauded in the scheme.
The Stradella Road property was most recently listed with Hilton & Hyland’s Tyrone McKillen for $36 million. McKillen declined to comment.
Woodbridge paid Morton $36 million for the Stradella Road property in January 2017, according to records. It was one of many pricey residential properties that Woodbridge purchased before the Securities and Exchange Commission uncovered the fraud.
The firm released renderings of a spec home it planned to build there, and listed the property shortly after that for $45 million.
The property is now shovel-ready, according to a land-use consultant who has worked at the property. In 2015, preliminary work began at the site.
“It’s been through all of its approvals at this point,” said the consultant, Penny Flynn. “It went on a slow track because they were selling the property.”
In June 2018, Woodbridge asked a federal bankruptcy court to allow a $44 million sale of the Stradella Road property, but that sale never closed. Court records show the prospective buyer was Elite Investment Management Group, a development company with an office on Wilshire Boulevard.
In the SEC’s suit against Woodbridge CEO Robert Shapiro, it claimed he promised investors high returns on investments in mostly luxury spec homes. But authorities said he actually moved their cash into accounts he controlled, and used it to pay off older investors, perpetrating a classic Ponzi scheme.
Authorities charged that Shapiro personally spent $21 million on private jets, at luxury country clubs, and other extravagances. He claimed no wrongdoing, but in November, agreed to pay a $120 million settlement for running the alleged fraud. He, his wife, and others involved in the scheme will pay a total of $892 million to the SEC to compensate victims.
Woodbridge moved to offload its sizeable portfolio following the bankruptcy and in March 2018 was on the hunt for a broker to sell all of its Los Angeles properties.
At the time, that portfolio included the Owlwood and Mount Olympus estates, and numerous properties in Hidden Hills, Bel Air, and Beverly Hills. Three properties were reportedly in escrow for a total of $10 million at the time.
Stradella Road might have a new owner, but the story isn’t over for Woodbridge. Charges continue to roll in. In December, 13 individuals were charged for selling bad Woodbridge securities to investors in Florida.