Hadid: I must continue building Bel Air mansion to satisfy creditors

Developer says he won't bankroll project from his own personal fortune

Los Angeles /
Dec.December 03, 2019 02:00 PM
Mohamed Hadid in front of the mansion a judge has ordered demolished Category residential real estate (Credit: Getty Images)
Mohamed Hadid in front of mansion at 901 Strada Vecchia Rd. a judge has ordered demolished (Credit: Getty Images)

Mohamed Hadid said that fighting City Hall and a judge’s order to tear down his 30,000-square-foot Bel Air spec mansion is his only financially feasible option, as the entity that owns the mansion is in debt for $28 million.

901 Strada LLC, the Hadid-managed company behind the 901 Strada Vecchia Rd. project, filed for Chapter 11 bankruptcy on Nov. 28 in California federal court.

The move for bankruptcy protection came one week after Los Angeles County Superior Court Judge Craig Karlan sided with neighbors suing Hadid and ordered the mansion demolished to its foundational slab. Earlier last month, Los Angeles city attorney Mike Feuer filed a motion in a separate criminal proceeding against Hadid, which also called for the mansion’s destruction.

But in an interview with The Real Deal Monday, Hadid said he must persist with constructing the mansion because he owes creditors about $28 million on the property, which critics have dubbed “Starship Enterprise” for its saucer-shaped house. First Credit Bank, which specializes in bridge loans, is the primary debt holder. The bank, which had $454 million in assets as of Sept. 30, is owed around $17 million, according to Hadid. The only way to pay that money back, he said, is to see the project through, and eventually sell the mansion to cover his costs.

“You always can borrow the money to build,” Hadid said. “But I can’t borrow more money to demolish it.”

Hadid said that the LLC does not have the $500,000 to put the mansion into receivership, as Karlan has ordered, much less the approximately $5 million it would cost to demolish the building.

“It’s not part of the LLC’s budget to knock the house down,” he said. “There’s not $500,000 in the budget that can go to demolishing the house.”

Hadid suggested it was a non-starter he bankroll the demolition through his own personal fortune.

“I wouldn’t be legally required,” he said. “The LLC operates on its own.”

The LLC’s bankruptcy filing papers have yet to provide a list of secured creditors.

A handful of unsecured creditors such as construction, plumbing and welding companies are listed in the initial bankruptcy filing with debt holdings totaling less than $1 million (the largest such unsecured creditor listed is Rail Design & Management of Chatsworth, which has a $387,000 unsecured claim).

The Daily Mail reported last week that Hadid personally guaranteed the $17 million loan.

A longtime developer of Los Angeles megamansions, Hadid constructed much of his Strada Vecchia mansion by the end of 2015 amid complaints from the city and neighbors. In 2017, he pleaded no contest to misdemeanor charges of violating the city’s building code, and he served 200 hours of community service.

Hadid has subsequently argued that the mansion is salvageable, but the city attorney and Department of Buildings say part of the structure could roll down the hill it was built on.

Hadid has appeared on multiple reality television shows, and his daughters Bella and Gigi Hadid are internationally known fashion models.


Related Articles

arrow_forward_ios
Yo Gotti (Getty) with 1051 Candlecrest Drive (Redfin)
Rapper Yo Gotti pays $8M for Westlake Village mansion
Rapper Yo Gotti pays $8M for Westlake Village mansion
Megan Fox and Machine Gun Kelly (Getty)
Megan Fox, Machine Gun Kelly take $30K a month rental
Megan Fox, Machine Gun Kelly take $30K a month rental
Sumner Redstone (Getty) with 31 Beverly Park Terrace (Redfin)
Sumner Redstone’s Beverly Park estate flies off market for $27M
Sumner Redstone’s Beverly Park estate flies off market for $27M
Kourtney Kardashian and her Madison Club property. (Getty, Madison Club)
Kourtney Kardashian drops $12M on brand new mansion in Palm Springs
Kourtney Kardashian drops $12M on brand new mansion in Palm Springs
Polo G and his Chatsworth compound (Getty, The Agency)
Rapper Polo G buys Chatsworth compound ahead of release of third album
Rapper Polo G buys Chatsworth compound ahead of release of third album
Bridget Fonda and Danny Elfman with 4179 Valley Meadow Road (Getty, Redfin)
Bridget Fonda and Danny Elfman buy neighboring homes in Encino
Bridget Fonda and Danny Elfman buy neighboring homes in Encino
LA Dodgers co-owner Bobby Patton and the property (MLB, Compass)
LA Dodgers co-owner puts Los Feliz estate up for $15M
LA Dodgers co-owner puts Los Feliz estate up for $15M
Tara Lipinski and the 6,779-square-foot home in Pacific Palisades (Getty, Compass)
Olympic gold medalist Tara Lipinski lands Pacific Palisades home
Olympic gold medalist Tara Lipinski lands Pacific Palisades home
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...