Beach Mansions Are Big Sellers Again

A Mediterranean-style mansion known locally as the “Gucci house” sold this week for $13 million. A mile up the coast, a house that sold last year for more than $14 million is back on the market--for $18 million.

From south Orange County to Malibu and beyond, the coastal abodes of the region’s richest and most famous are once again hot items.

Realtors say the battered mansion market bottomed out two years ago and has zoomed this year. Many buyers are flush with stock-market winnings and in a confident mood.

“It’s like artwork, some of these one-of-a-kind ocean properties,” said Bill Rolfing, a First Team Nolan agent in Laguna Beach. “Sometimes you make big money. Sometimes you lose. But there is nothing in the world like that house.”

During the first eight months of 1997, 757 homes in Los Angeles County sold for $1 million or more, up 51% from the first eight months of 1995, according to real estate figures compiled by Acxiom/DataQuick.

The proportional increase was even greater in Orange County, where 205 homes sold for $1 million or more through August this year, up 61% from the same period in 1995.

“We’d have to go back to 1992 to come up with numbers close to these--it’s the strongest market in five years,” said John Karevoll, an Acxiom/DataQuick statistician.

The sales are reminiscent of halcyon days of the ‘80s when many fortunes were invested in mansions.

Indeed, the $18-million home for sale that overhangs a bluff was built by Boyd Jeffries, a stockbroker convicted in the ‘80s insider trading scandals. Bought by an unidentified software baron last November for $14 million, the highest-priced home ever sold in Orange County, it’s back on the market--and the price has gone up.

“People are not afraid to spend money again,” says Paul Grisanti, a Coldwell Banker Jon Douglas agent in Malibu, adding that there’s no longer fear prices may fall.

The conspicuous consumption embarrassment factor, which set in when nearly everyone except Hollywood executives was hammered by the state’s long recession, has waned as well, Grisanti said.

That can translate into a hunger for properties such as the Gucci house, towering on a bluff above Aliso Beach, or the former Jefferies house, which has an octagonal bedroom cantilevered out over the sea, complete with a turntable circular bed.

“Four years ago if you had money it was considered very un-OK to spend it on a house or a nice car,” Grisanti said. “Now people are not afraid of offending their friends because the economy is better all around and their friends aren’t hurting financially any more.”

Prices are also on the rise, though still well below their near-hysterical peaks of eight years ago, real estate agents say. The decline spelled big losses for those who mistimed their mansion procurements.

Dodi al Fayed, the millionaire killed in a car crash with Princess Diana, paid $7 million this year for a Malibu home, Grisanti said.

The seller had bought it from actress Julie Andrews and producer Blake Edwards in 1992 for a reported $8.5 million and, according to Grisanti, “must have put at least $1.5 million into it.”

The Laguna mansion that sold Tuesday was built eight years ago by Severin Wunderman, a manufacturer and distributor of Gucci watches, who decorated it with such touches as fireplaces imported from European chateaux.

Surrounded by palm trees and 10-foot walls, the 10,000-square-foot Mediterranean estate with guest house is on a cliff-top property with a gazebo from which stars such as Charlie Chaplin once gazed out at Santa Catalina Island, said Nancy Lavigne, a Coldwell Banker agent in Laguna.

As an illustration of how the market has changed, Wunderman told The Times in a March 1996 profile that he was trying to sell the estate for $10.8 million.

Unable to find a buyer, he pulled it off the market for a year before again listing it with little fanfare last May--and getting the $13-million price this week.

“After the first of the year, the oceanfront market just triggered,” said agent Bill Dolby, who has a listing on the home next to the Gucci house at a mere $5.5 million.

“People are buying them like crazy.”

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Million-Dollar Market

Sales of $1-million homes in both Orange and Los Angeles counties soared during the first eight months of the year, reaching the highest level in both since 1992. January-August sales of homes costing $1 million or more:

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Orange Los Angeles County County 1990 307 1,173 1991 239 1,150 1992 233 864 1993 143 662 1994 160 729 1995 127 501 1996 160 569 1997 205 757

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Source: Acxiom/DataQuick