Strada Vecchia’s demolition derby will ride along for a couple more weeks.
A judge has again delayed the resolution of an auction that’s intended to transfer the infamous and now county-controlled property in Bel-Air to a private owner.
901 Strada Vecchia Rd (Hilton & Hyland)
The sale is expected to raise funds to tear down the partially-built mansion conceived by high-profile spec developer Mohamed Hadid. The county is currently on the hook for the costs of the court-ordered demolition.
The auction had been set to conclude Oct. 1, but four bids the property received all came in under a minimum bid set at $5.5 million. L.A. County Judge Craig Karlan rejected a high bid of $5.1 million at the time, directing the property’s court-appointed receiver to engage in discussions with the two highest bidders.
After those discussions, according to court documents reviewed by The Real Deal, the highest bidder, J.K. Properties, declined to increase its bid. The second-highest bidder, Sahara Construction Company, expressed interest in maintaining its earlier $5 million bid and bearing the costs of the demolition itself, under the supervision of the court.
The latest delay came on Friday and represented another twist in a saga that’s played out for the better part of the past decade, pitting the brash celebrity Hadid against both the authorities and the Bel Air property’s wealthy neighbors, who continue to view the abandoned spec project as an imminent danger.
The case continues to produce Hollywood-worthy additions to the court record on the case in upscale Bel-Air, where many entertainment industry A-listers have homes.
“It scares us dramatically,” Joe Horacek, a neighbor who led a civil suit against the project, said last week. “Especially when it comes to the rainy season, because we know that ‒ and it was proved during the course of the trial ‒ that the foundation is inadequate and doesn’t meet code.”
Horacek said he and his wife, who live down the hill from the abandoned spec mansion, often leave their home out of safety concerns when it rains.
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At Friday’s hearing Karlan considered the proposal from Sahara but, rather than accepting it outright, asked the receiver to also show the plan to J.K. Properties, who would have another chance to amend their offer. Karlan scheduled a subsequent hearing on the issue for later this month.
“Yes, it has been a long process — much of it that predated my involvement — but we are very focused on bringing a resolution to this and think that we have a strategy in sight that gets us there,” said Douglas Wilson, the receiver.
The contours of the pending deal could also change again this week, when Wilson meets with the county’s tax appeal board. The court, which has controlled the property for nearly two years, has been attempting to reduce the $1.6 million in past due taxes owed on the property. A reduction of that figure could presumably make a lower offer more appealing to the court.
“That’s part of the negotiation,” Wilson said. He added that at least some reduction in the taxes owed was likely.
Earlier this month Todd Wohl, cofounder of Premier Estates, the brokerage that handled the auction, characterized the auction as a success, despite the lower than desired bids, and said he was confident a deal would be reached on the ultra high-end property.
“The court has to do what they have to do to finalize the sale, which they will do,” Wohl said.
In September, as the auction was underway, Wohl had recommended the court lower the property’s MLS listing price from $8 million to $5.5 million because of a lack of interest, referring to the listing as “stale.”
The battle over Strada Vecchia has become among the longest, most salacious construction disputes in L.A. history.
After buying the property in 2011, Hadid began building an extravagant, 30,000- square-foot spec project, only to run into trouble with the building department because the build far exceeded the property’s approved plans. In 2017 the celebrity developer pleaded no contest to criminal charges over the construction and was sentenced to community service, and the following year Horacek, a high-powered entertainment lawyer, and other neighbors also filed a civil suit. As part of that suit the court ruled the property was dangerous — it could collapse or slide down the steep hill under extreme weather conditions — and seized control.
The court also ordered a tear down, only to so far leave the structure — long ago dubbed by critics “Starship Enterprise” because of its resemblance to a spaceship — standing because of a lack of funds. The civil case concluded in early September, when a jury ordered Hadid had to pay $3 million in damages to the case’s four plaintiffs, a fraction of what they were seeking.
A representative for Sahara did not respond to a request for comment.