House flipping: Stars get in on the act
In Tinseltown, even movie stars can be found playing the home-flipping game — and this year they’ve upped the ante.
Celebrity muscle is behind some mega-bucks Westside property turnarounds, part of a boom in the rapid buy-fix-resell mania known as flipping.
Actors Jeremy Renner and Kristoffer Winters have roughly two dozen house flips under their tool belts. They just sold an estate in Holmby Hills for $24 million. The Roaring ‘20s Art Deco-style mansion, which Winters dubbed the Reserve, is set at the end of a cobblestone driveway on two acres.
Brad Blumenthal, who played Jerry Lewis in “Pulp Fiction,” and co-investor Leo Hauser have a contemporary compound they created in Hollywood Hills West listed for sale at $28.8 million. Set above the Sunset Strip, the sleek home and guest house make the most of their head-on city views.
The ranks of celebrity home flippers include Oscar-winning actress Diane Keaton, “L.A. Law” actor Corbin Bernsen and his wife, actress-interior designer Amanda Pays, and “Dr. Quinn, Medicine Woman” star Jane Seymour, area real estate agents say. Other entertainers opt to invest in home flipping behind the scenes and let someone else do the work.
Flipping activity is frenzied this year and not just among the famous.
The recovering real estate market has seen an increase in flipping at all price points, with the quick turnover of luxury properties nearly doubling since last year, according to DataQuick, a real estate information provider. In the $1-million-plus market, 5.3% of properties were flipped in the first six months of this year, compared with 3.4% during the first half of last year.
In the luxury niche, home flips typically require at least a year to complete, compared with six months in the overall market, said Jan Brzeski of Arixa Capital Advisors, which provides funding for homes in prime locations being renovated for resale. The flippers he works with typically see profits in the 12% to 20% range, he said.
Stars who are also flippers have the added advantages of a built-in publicity hook, an established network of contacts and unique insight into the taste of the well-heeled Hollywood crowd.
Still, most celebs prefer to stick to their day jobs rather than put millions of dollars at risk.
“There are not a whole lot who are playing at this level,” said real estate broker Billy Rose of the Agency, who is one of the listing agents for the Sunset Strip compound. Those who dare, he said, often want to make an architectural statement as well as money.
That would describe the Renner-Winters team, who began flipping houses as a way to survive between roles and now specialize in dramatic houses.
“As an actor starting out, you can have so much free time on your hands,” Winters said. “I used to have the nicest apartments and people would say, ‘Hey, can you help me out?’”
Renner and Winters, who were both in the Oscar-winning film “The Hurt Locker,” started flipping a dozen years ago, turning around a $600,000 house in the Nichols Canyon area for $900,000.
“We didn’t have any clue as to what we were doing,” Winters said of the first flip. “But we made a really nice chunk of change.”
They sunk the profits into another house and another, often living in the homes they were renovating early on, he said. “We would sleep on the sofas.”
The challenge and artistic outlet has proven a fit for their talents. Winters likens the flipping process to “figuring out the Rubik’s Cube on how I can make this house flow better.”
They have sold most of their homes furnished, which meant settling in the next place and starting from scratch — sometimes without power or water, Winters said. “My office used to be in an SUV.”
A monthly gym pass would provide a place to shower and brush their teeth.
Balancing acting careers and construction projects presented its own challenges, Winters said. “I’d have 10 pages of script to memorize, and guys to supervise on the work site.”
Up until the last several years, the two made more money flipping houses than acting, Winters said. Now, Renner keeps busy with films such as “The Bourne Legacy” and “The Avengers,” and Winters is focusing full-time on flipping houses, often bringing in other financial partners. He has offices on Sunset Boulevard and a staff of five.
Winters is juggling several projects — one with Renner and two with clients — while he looks for his next house to tackle.
The Reserve, with a wine cellar, a theater, six bedrooms, 11 bathrooms and 10,000-plus square feet of living space, is the most ambitious undertaking to date. The property cost $7 million and the nearly $25-million asking price included pretty much everything the buyer needed to move right in.
“If you are going after a big-boy house you have to know your market and your clientele,” Winters said. Convenience is essential in this niche market, especially with foreign buyers. “They don’t want to spend two years with an interior designer.”
The new owner needed to bring only a toothbrush, suitcase and laptop, he said. “The Wi-Fi was already set up.”
At Blumenthal’s house above the Sunset Strip, the focus is also on creating a trophy property.
“These are one-of-a-kind gems that no one else has,” said the actor, who has flipped 16 homes in as many years. “People want a sexy house.”
The one-acre-plus compound he helped develop includes 13,000 square feet of living space in three structures — a main house, a guesthouse and a gym/wellness center above the garage.
Designed by noted architect Hagy Belzberg, the estate features spaces for indoor-outdoor living, a swimming pool and a lawn. There are eight bedrooms and nine bathrooms.
The wine “cellar” is a glass-walled room with bottles artfully displayed. The kitchen, often the heart of a party, has its own dining and living areas.
Despite the high finances involved in developing the home, Blumenthal is confident he has the winning combination of panoramic city views, usable outdoor space and lawn and architectural style to warrant the $28.8-million price tag.
“I’ve never come close to losing money on a house,” he said. “I don’t get involved unless it’s a no-brainer.”
Winters, however, is willing to admit that as the budgets have gotten bigger, so has the financial risk.
“It’s a big gamble,” said Winters, who said he continues to learn each time he tackles a house. “You just hope you make less mistakes.”