Dreamers have long flocked to La La Land seeking wealth, fame and the perfect climate to flaunt them. But never before has Los Angeles real estate so blatantly reflected those stardust fantasies.
As the county booms with spec mansion development (page 8), builders are going big. The likes of Bruce Makowsky and Nile Niami are asking sky-high prices — $250 million and $500 million, respectively — for over-the-top homes. They leverage perks, including car collections, casinos, jellyfish-tank walls and Dom Perignon-filled fire extinguishers, as they compete to woo the world’s wealthiest buyers.
Meanwhile, a wider variety of bold personalities is getting in on the action. Take Mauricio Umansky, interviewed in The Closing, on page 58. The reality TV star and outspoken co-founder of luxury brokerage The Agency partnered with investor Mauricio Oberfeld to purchase one of Malibu’s largest homes for $38 million. After giving it a major face-lift, the duo flipped the property in April for just shy of $70 million.
L.A.’s “bigger is better” philosophy does not end with its mansions. It extends to the people who sell them, which we explore in a broker ranking and analysis on page 32. The brokerage industry has seen the rise of the mega-Realtor, with heavy hitters like Umansky dominating an outsized number of deals. The rise of the team model, in which lead brokers act like quarterbacks for a team of less visible staff working the back end, is controversial. Some in the industry believe it allows select brokers to appear larger than life while inflating their numbers.
After all, in the land of glitz, controversy tends to “go big” as well.
Sometimes, the action even has the dramatic flourishes of a Hollywood blockbuster. Consider the joint-venture dispute between developer Neil Shekhter of NMS Properties and his former partner AEW Capital, broken down on page 22. The litany of lawsuits involved include claims of forgery, Google searches for how to delete evidence and even assault allegations.
As cinematic as it may be, it is unsurprising that a portfolio of multifamily properties in pricey Santa Monica and elsewhere on the Westside could cause a battle of epic proportions, as demand for apartments remains high.
But elsewhere, in the commercial market, there is trouble looming. Experts see signs of an impending slowdown in office leasing as construction costs and sublease space availability rise. See page 28. And on the retail front, a string of failures at Ratkovich’s Bloc development has insiders concerned about Downtown L.A.’s retail prospects (page 14).
We are also proud to bring you a number of profiles in this issue of some of the biggest movers and shakers in L.A. real estate, including retail billionaire Rick Caruso (page 38), hospitality mogul Sam Nazarian (page 18) and some of L.A.’s most powerful real estate families (page 24).
Enjoy the issue.