Compass’ Russell Grether has been helping his mother-in-law rebuild her Malibu home destroyed in 2018’s Woolsey Fire.
After seven years, she’s in the finishing stages and is likely going to be done by the end of the year, hopefully before Christmas.
“It took her probably a year or two to wrap her head around that whole process and then another year or two to get permits,” Grether said. “It’s seven years later and it’s almost done.”
She’s not an anomaly.
If the past offers any sense of what’s to come, rebuilding won’t be quick in Malibu.
At least 488 homes in the city were destroyed in 2018’s Woolsey Fire, according to a Malibu Planning Commission report. To date, 205 certificates of occupancy for single-family residences have been granted.
In the case of this year’s Palisades Fire that claimed 700 homes in Malibu, a single plan check – the last step before a building permit is issued – has been approved, according to city data. Another seven have been submitted and are under review. No permits have been issued.
Now, the city is scrambling for another recovery blueprint to bounce back from January’s Palisades Fire even as it works its way through ordinances, zoning mazes and deadlines to navigate fallout from the 2018 blaze. For real estate agents on the ground, recovery through the lens of dealmaking has begun to ramp over the past month.
“I’ve already started working with buyers who are, I think, going to be a part of the recovery story and that’s very exciting to see because there’s always a period of time, or at least what we experienced after Woolsey, where the sentiment was fairly negative for a bit,” said Grether, who is founding partner of Compass’ Malibu office and helms the Grether Group.
He’s not the only one seeing the turn.
Carolwood Estates’ Cooper Mount, who specializes in Malibu and grew up there, also noted business picking up over the past four weeks, particularly on Carbon and La Costa beaches, where deals have been closing at anywhere from $5 million for a single lot to $14 million for one-and-a-half to two lots.
At the top of this year’s burned lot sales was a property with 60 feet fronting the ocean on Carbon Beach, also known as Billionaire’s Beach. The roughly 12,600-square-foot plot at 22102 Pacific Coast Highway traded for $14 million last Tuesday.
Among this year’s five largest lot sales in Malibu, the least expensive trade was for a 6,600-square-foot piece of La Costa Beach land at 21360 Pacific Coast Highway, which sold for $5.1 million last Wednesday.
As interest percolates among buyers, people are seeing a way into a highly coveted community with a finite amount of oceanfront property.
“There’s not going to be any dive in desirability,” Mount said of what’s to come for Malibu real estate. “It’s an incredible place and there’s only so much beach available. There’s only one front row.”
Another view
An overseas buyer apparently got that memo.
Christie’s International Real Estate Southern California’s Weston Littlefield and Alex Howe represented that buyer on the purchase of eight lots on La Costa Beach and one on Carbon Beach, totaling roughly $65 million.
The duo declined to provide additional details on the buyer, but said rebuilding is the intent. Their client has built the back-end infrastructure to do that as efficiently as possible with an in-house consulting team of architects and expeditors.
News of the deals was received in some corners with mistrust of a single buyer scooping up multiple lots. Those who understand the regulatory environment and what goes into the building process hold a different view.
“From my perspective, we’re lucky to have somebody like this purchasing these lots and taking the time to rebuild,” Howe said.
The process will be a long one as many have seen with the Woolsey Fire recovery.
In Malibu, particularly on the beach, building is tough and pricey.
Anywhere from $2 million to $3 million has to be shelled out pre-construction for infrastructure such as a septic system, seawall barrier protecting properties from waves and flooding and foundational caissons to support homes on the sand. Having the stomach and capital to see those projects through isn’t for everyone. Some who want the community to bounce back quickly, see economies of scale and multi-lot deals as one way of moving forward.
“Their ultimate goal is to make Malibu not only what it used to be but an even better place,” Littlefield said of his and Howe’s client buying multiple lots. “They’re going to basically make the best houses on the best beach and make this place great again. They’re just super excited to be at the forefront and they ultimately are going to make this place awesome.”
Price creep
Prices will no doubt rise in a place that’s already expensive to build.
“If you think prices are high now, it’s going to be more expensive because all the new rules, regulations and inflation is going to make this already premier beachfront even more premiere and expensive,” said Beverly Hills Estates co-founder Branden Williams.
Video of Williams, who lives on La Costa Beach, putting out the flames at his home back in January and saving it from destruction has been widely circulated.
As a resident, he’s looking at rebuilding from a pragmatic standpoint.
“Most of these houses needed to be torn down anyways,” he said. “They were little beach shacks from the 40s, 50s, 60s and 70s. A lot of the foundations needed to be redone. They were on little sticks.”
Many are simply waiting to see what shakes out from local government when it comes to ordinances and infrastructure, in a bid to time construction as close as possible to when those decisions are complete. In other cases, more homeowners’ lots may trickle into the for-sale market as some ultimately decide rebuilding isn’t for them.
Grether’s wife grew up in Malibu and the couple are now raising their two children there, They welcome “signs of life” that he says are starting to peek through as people return to the city. Unlike other areas burned by the Palisades and Eaton fires, Malibu sat isolated with the closure of Pacific Coast Highway earlier this year.
“There is a positivity that is starting to occur, which did not exist previously,” Grether said. “There were definitely some dark moments after the fire, where it was hard to be super positive, selling the lifestyle-type mentality when it was very dire, so it’s been nice to see that sort of mentality shift.”