‘86 Mansion Market Sizzled : Westside Topped U. S. Sales of Expensive Homes
Big-ticket home sales were as “common,” if you’ll excuse the expression, in 1986 as a Gucci purse at a beach party.
That’s fairly common, if the beach is Laguna or Malibu.
Activity in the $5-million-and-up residential field in Southern California was surprisingly brisk for that category of house, though the real-estate market was generally hot, especially during the last quarter, and no all-time record in sales price was established.
The brisk activity was surprising, because the $5-million level is so high, it’s enough--even during the best of times--to choke a magnate.
Merrill Lynch Realty, Beverly Hills staff people checked with their regional offices in Arizona, San Francisco, Orange County, and northern Los Angeles County (stretching from the San Fernando Valley to Santa Barbara), and none of its offices had any sales during 1986 for more than $5 million except in L. A.’s Westside. A check of realty offices in other states disclosed that L. A.’s Westside topped the nation for home sales at $5 million or more.
It should be no surprise then that Bel-Air held the record in 1986 for the largest single-family sale that anybody is talking about, anyway, in the whole United States.
It was the $13.6-million sale of the Kirkeby Estate, known to millions of TV viewers as the “Beverly Hillbillies’ ” house. Ironically, a first-year sales agent--Kathy Villa of Asher Dann Realtors in Beverly Hills--found the buyer. TV producer Jerry Perenchio purchased the 19,488-square-foot home on 6.3-acres, built in the ‘30s.
More Costly Houses
The house was listed at $27 million, making it the highest priced home in the United States. “It’s my feeling that it would have gone for more if it had been on the market in 1980,” Jim Retz, a vice president of Landvest in New York City, said.
That was the beginning of a rash of eye-boggling transactions that peaked with a home sale in 1983 of $22.5 million, which hasn’t been matched yet. Why? “There are so few houses in this stratosphere, and it takes time to sell them,” Jeff Hyland, president of the Beverly Hills Board of Realtors and a principal of Alvarez, Hyland & Young, explained.
Leading up to the $22.5-million transaction was the 1980 sale of the late Conrad Hilton’s Bel-Air Home to real estate developer David Murdock for a record $12.5 million. Three years later, TV producer Aaron Spelling bought the Bing Crosby Holmby Hills estate for $10.5 million, and about the same time, Leslie H. Wexner, chairman of The Limited Co. (women’s wear retail stores), purchased the Palm Beach estate of Mrs. Charles Wrightsman for $10 million.
Spelling and Wexner then tore down the houses that they had acquired.
In 1983, Adnan Khashoggi, the Saudi Arabian businessman who has been in the news lately involving the Iran/ contras deal, bought a 51-acre Santa Barbara estate with 1.5 miles of beach frontage for $8.45 million, and Eugene Klein, who made a fortune owning a chain of movie theaters and later owned the San Diego Chargers before turning his attention to raising race horses and developing real estate, sold his Beverly Hills home, built in 1914 by Burton Green (one of the founders of Beverly Hills), for $8.5 million to a Middle Easterner.
That year also brought the $22.5-million sale, which is the record all-time single-family home price so far in the United States. Denver oilman Marvin Davis paid it when he bought singer Kenny Rogers’ Beverly Hills home, known as The Knoll. The 30,000-square-foot main house on the 11-acre property was built in the ‘50s by Leigh and Lucy Battson, widow of oilman Edward L. Doheny Jr.
It has been three years now since the $22.5 million sale was made, and though a few residential properties, besides the Kirkeby Estate, have been listed at $25 million or more, none has yet come close to that amount for a sale.
The closest in 1986 to the Kirkeby transaction was the 96-acre Gimbel Estate, also known as “Chieftans,” in Greenwich, Conn. “We closed it on Dec. 15 for $10.5 million,” Retz said.
The property, one of the last significant land holdings in Greenwich, was used as a country estate by the Gimbel (department store) family. It has a 16,000-square-foot, stone colonial residence built in 1913, a 7,000-square-foot stable, caretaker’s cottage, swimming pool, several garages, and a cow barn.
Landvest closed escrow last November on a Long Island estate that was once held by the Roosevelt family--”as in Presidents Roosevelt,” Retz noted. It sold for $6.64 million--”a record for Long Island.”
New York developer Donald Trump’s purchase last year of the late Marjorie Merriweather Post’s, 118-room Palm Beach residence is believed to be higher. Real estate sources estimate that he paid $7 million for the estate, which the state rejected as a gift because the maintenance would be so high.
Palm Beach, New York City and Beverly Hills currently have the highest-listed, but the Westside of Los Angeles had more residential sales in 1986 in the $5-million and up category than any other place in the country.
Consider Pittsburgh, Pa. Rick Merrill recently left there to become president of Merrill Lynch, Beverly Hills. “The entire city of Pittsburgh would sell maybe two or three homes at $1 million to $3 million a year,” he said. At rough count, there were 13 sales at $5 million or more on L. A.’s Westside last year.
Among these was the sale of a Beverly Hills house for $5 million to entertainer Merv Griffin, another Beverly Hills home for slightly more to singer Frank Sinatra, a Beverly Hills home for about $5 million to newspaper publisher Rupert Murdoch, the former Harold Lloyd estate in Beverly Hills for $6.5 million to TV producer Ted Field, a Holmby Hills home for $6.3 million to talent agent Irving Azoff, and a Pacific Palisades home for about $7 million to producer/director Steven Spielberg. (Singer Bobby Vinton was the seller.)
A house built on speculation in Trousdale went for $5.78 million. “I think it’s the highest price paid so far for a house built in the Beverly Hills area on spec,” Hyland, who sold the house with Victoria Lockwood, said.
In Laguna Beach, a house sold last year for $8.25 million, and in Tustin, one sold for $6 million. It was a record-breaker for that area, said Brooks Barton of Previews in Santa Barbara, which handled the sale.
The rush was on to close escrows before the end of the year to beat the new tax law, which went into effect Jan. 1, but people are still buying the high-priced homes.
Barton said, “Some of our biggest sales are closing in January. You would think they would have wanted to close in December, but for some reason, they are closing now. There are a couple in the $9-million category.”
Hyland said that in the next several years, there will be a “tremendous increase in the value of these expensive homes,” because under the new tax law, mortgage-interest deduction payments and property taxes may still be deducted, but there are only so many good houses in the higher prices.
Don Caverhill, whose firm, Caverhill & May, just sold a Beverly Hills house for about $5 million, said that more people are putting “a bigger amount of debt in their houses rather than in other things that formerly were tax write-offs.”
