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n
a hilltop in Bel Air, a 100,000-square-foot gigamansion is under
construction, for no one in particular. The asking price—$500
million—would shatter records, but, as ridiculous as it sounds, in
L.A.'s unbridled real-estate bubble, this house could be billed as a
bargain.
High
above Bel Air, Nile Niami is looking down on the tiny mansions of mere
millionaires as he stands on a plywood platform that will soon be the
roof deck of the house he's selling for $500 million. When you expect a
half billion dollars, everything has to scale up, including the views,
and from this hilltop, they span 360 degrees—encompassing the San
Gabriel Mountains, the Pacific Ocean, and, today, Niami's Rolls-Royce
Phantom convertible, parked in the driveway below. The 47-year-old
developer is taking it all in . . . and explaining why he believes the
property is not really so expensive when you think about it.
From the Editors of Details
The
home itself, when it's finished in 2017, will have five swimming pools,
a casino, a nightclub with a VIP area, a lounge with jellyfish tanks
in lieu of walls and ceilings, and various other amenities that might
seem excessive at the Ritz-Carlton Abu Dhabi. It will be more than
100,000 square feet, twice the size of the White House. So the price
works out to about $5,000 per square foot, which, Niami notes, is less
than half what several billionaires have paid for their casino-less
Manhattan penthouses. "We have a very specific client in mind," says
Niami, who is wearing a slim-fitting polo shirt and a Breguet watch.
"Someone who already has a $100 million yacht and has seven houses all
over the world, in London and Dubai and wherever."
Niami
rarely gives interviews, which is perhaps a wise choice. Brusque,
blunt, and palpably cologned, he isn't one to make apologies about his
new project's size or price tag. "To be able to say that the biggest and
the most expensive house in the world is here, that will be really good
for L.A.," he says. That's not necessarily a universally shared
sentiment. He's been unpopular in Bel Air since last fall, when he
sliced off the top of a hill in order to enhance the panoramic vistas on
the four-acre lot. For weeks, a convoy of dump trucks snaked up and
down the narrow streets, removing approximately 40,000 cubic yards of
dirt. And although Niami has avoided the public legal scuffles that have
ensnared other high-rolling Los Angeles developers who build on spec
(construction has been frozen on Mohamed Hadid's spaceshiplike megavilla
nearby because of permit violations), this $500 million listing has
marked him as the embodiment of the market's unbridled extravagance.
When
the house's asking price was announced last May, some people figured it
was an absurd marketing ploy, since if the property fetches anything
close to $500 million, it will obliterate the current world-record price
of $221 million, for a London penthouse. But absurdity is all relative
in today's gigamansion market—particularly in L.A., where previous
milestones such as the $85 million sale of the 123-room Spelling manor
in 2011 are beginning to look quaint. (That property is about half the
size of Niami's, and its current owner, the British-born heiress Petra
Stunt, reportedly put it on sale last year for $150 million.) Right now,
speculative developers in particular share one prevailing mantra: If
you overbuild it, they will come.
The
main thing to understand about L.A.'s growing crop of no-expense-spared
spec homes is that they are not actually homes, in the usual sense of
the word. Most buyers live on other continents and visit these
properties for only a week or two each year, using them mainly as places
to park their wealth. After all, in an era when a Cézanne painting can
fetch $250 million, a massive trophy estate in Bel Air might seem like a
perfectly sensible investment to a billionaire sheik or oligarch who's
looking to keep his money safe from a grabby despot back home. And sure
enough, for these clients, "bigger" and "better" are generally
synonymous. Last year, when Niami was selling a 32,000-square-foot manse
in the Holmby Hills section of L.A., he discovered that, despite its
four-lane bowling alley and indoor pool, many potential buyers wanted
more parking and bigger staff quarters. "It only had a five-car garage,
and everybody complained," he says.
No
one can accuse Niami of ignoring the "go big or go home" ethos with the
Bel Air property. As Drew Fenton, the real-estate broker who has the
listing, says, "It is by far the most important estate project in Los
Angeles over the last 25 years and will raise the bar for all other
estates built in the city." (It will also raise the bar for Fenton's
future commissions, since even a 2 percent cut on this sale could earn
him $10 million.) One entire temperature-controlled room will be
dedicated to storing fresh flowers. Marketing materials refer to the
property simply as "The One," and in lieu of a standard virtual tour,
Fenton has put together a slickly produced film, with dozens of
real-life, green-screened models populating a lifelike digital
rendering. It shows the urbane man of the manse pulling up to the front
door in his red Ferrari LaFerrari and moving through expanses of marble
and glass, from cigar lounge to billiards room to spa, while yoga-toned
babes swim in clear-walled pools, cavort on the indoor-outdoor dance
floor, and share laughs against a backdrop of neon-blue jellyfish. Part
of the goal is to present L.A. as a seductive alternative to more
typical billionaire havens like Monaco and Dubai and London, a city
whose appeal Niami simply can't fathom. "I mean, what's in London?" he
says. "The weather is horrible. I don't get it."
Niami,
an L.A. native who was raised by his mother, a special-ed teacher,
began his career in this town's other bastion of not-always-rational
expenditures: the movie business. During the 1990s, he worked as an
independent-film producer and at one point paid Steven Seagal $10
million for a film called The Patriot that never secured
theatrical release in the United States. But after realizing how hard it
can be to make money as a producer, he found an outlet for his outsize
entrepreneurial ambitions. Niami began dabbling in real estate, first
remodeling small homes around L.A. and later building new condos from
scratch. As a developer, Niami was unshackled, freed from the whimsical
demands of actors, directors, writers, studios, and agents. "In the film
business, you can't really control things, because there are too many
hands in the pot," he says. "Here, it's just me."
Around
2008, he met Fenton, who clued him in on the burgeoning market of spec
homes priced at $10 million to $15 million —a range that sounded
astronomical at the time. "I said, 'Who buys a house for that?'" Niami
recalls. He soon found out: cash-rich foreigners and entrepreneurs whose
wealth is immune to such little-people problems as subprime-mortgage
crises and stock-market swings. "For the $5 million houses, the buyers
still needed loans," he says. "But when you moved up to $10 or $15
million, it was guys who didn't have to rely on the bank."
Niami
was one of the first big spec developers to take on the Bird
Streets—the hilly enclave above the Sunset Strip that's been home to
celebs like Leonardo DiCaprio
and Halle Berry. In 2012, reports say, the Winklevoss twins paid him
$18 million for one of the "contemporary view" houses, with sliding
glass walls, sleek waterfalls, and infinity pools, that have become
Niami's trademark. At one point, Niami was building four houses
simultaneously in the tiny neighborhood. "We were buying land for $9
million, doing a remodel, and selling for, like, $39 million," he
recalls.
But
soon Beverly Hills' hot Trousdale Estates section beckoned. Exact sales
figures for the latest spec homes can be hard to pin down, since most
are off-market "pocket listings" and nondisclosure agreements are
routine. But in Trousdale late last year, the fashion tycoon turned
developer Bruce Makowsky sold a new 23,000-square-foot place to Markus
Persson, the creator of Minecraft, for $70 million, setting a record for
the area. Niami, who is building a property next door, has raised its
price accordingly. "I'd figured mine was going to sell for about 40," he
says. "But that one went for 70, so we're going to ask 90." When Niami
takes me to that site, he points out the future "Cristal room," whose
black lacquer shelves will feature a geometric display of champagne
bottles of varying sizes, and the basement-level "wellness suite," which
will include a hair salon with mirrors that double as TV screens.
Niami
has a different off-market property in Trousdale with another apparent
must-have: a spinning car turntable, similar to those in auto showrooms,
that's visible from the living room. "So, while you're watching TV, you
can see your $3 million car," he explains. This place is comparatively
small, at 14,000 square feet, but Niami is convinced it will fetch $45
million. He mentions a celebrity couple whose real-estate agents keep
calling. "They want to see it when it's done, because they're looking
for a house that has privacy," he says. A few streets over is a new
pocket listing (not a Niami development) that has Realtors abuzz: a
teardown on two and a half acres, priced at $135 million. Meanwhile,
just across the hill from Niami's Bel Air house, construction is well
under way on a 70,000-square-foot compound for a Qatari.
Niami's
chief architect, a wry Irishman named Paul McClean, acknowledges that
prices have become divorced from reality. "The numbers right now are
crazy, no matter how you look at them," he says. "But for most people
who buy these kinds of houses, it's not a decision that they calculate
based on price per square foot. It's more about the emotional draw. With
Nile, we're trying to sell a lifestyle, a sense of how people imagine
they would live." That's one reason Niami always sells his houses fully
furnished and decorated, down to the Junior Mints in the screening room.
(He gets what a certain client wants, and he's trying to apply that
touch to worlds beyond real estate. He recently launched a social-media
app, called Wolfpack,
for single straight guys looking for other dudes to hang out with.
Niami got the idea when a newly divorced friend was at a loss for ways
to meet people; the app links users with local poker sessions or bros
with extra Lakers tickets. Niami has hired a small team to run Wolfpack,
which is still building a membership but has already been featured on Nightline.)
For
as much bravado as Niami has about this project, what he can't—or
won't—say is equally intriguing. He doesn't know who sold him the
massive Bel Air plot, which originally included a decrepit home that he
promptly tore down. The secret transaction took place through a bank
trust, and the owner remained anonymous (Niami declines to say what he
paid). What he does know is that he managed to find room for almost
every luxury amenity he could dream up—except a gun range. During our
visit to the site in midsummer, the place is still a maze of steel beams
and cement trucks, though it's already easy to see that the finished
building will dwarf Hearst Castle. After showing me where the 40-seat
screening room will be, Niami walks me through the master suite, which
alone is 6,000 square feet—"but when you're in it, it doesn't look that
big, because everything else is so big," he says. Next we explore the
main level; the glass-walled library will have a double-height ceiling
and be surrounded on three sides by water. Don't bother looking for
first editions, however. "Nobody really reads books," Niami says, "so
I'm just going to fill the shelves with white books, for looks."
Stepping past the nightclub's outdoor lounge area where circular
banquettes will seem to float next to a two-story waterfall, he says: "I
really think that this house is going to do a lot for L.A. Anybody who
lives in the area is going to be proud to be near it."
Actually,
a number of them will be lobbying to prevent anything like it from ever
being built again. Last year, longtime Bel Air resident Fredric D.
Rosen, the former honcho at Ticketmaster, cofounded a homeowners'
alliance and quickly raised more than $750,000 from neighbors to help
enact stricter limits on oversize homes. "What level of sanity would
allow a house this big to be built, with a huge discotheque?" Rosen
asks. "Anything over 20,000 square feet should be considered a
commercial project." Even though Niami complied with locals' requests
for tighter controls—flagmen to ease traffic flow, reduced hauling
hours, etc.—Rosen and other critics contend that current building
regulations are outdated and haphazardly enforced. (In some parts of the
city, for example, there are height restrictions on new construction
but nothing to limit excavation.) "We're not some crazy antidevelopment
group telling you that your house should be gray or purple," Rosen says.
"What this is about is, you can't put a size-eight foot in a size-five
shoe."
But
you can try. From Versailles to Hearst Castle, big-house builders have
always relished barreling over—or veering around—any speed bumps that
came between them and their Xanadu. This spring, thanks in part to
pressure from Rosen's group, L.A.'s city council issued a temporary
ordinance to limit hauling and reduce construction traffic while the
planning board considers permanent, citywide restrictions. In Beverly
Hills, meanwhile, Niami says, "there are so many ridiculous rules that
they put into place, and that's why I'm not building in Trousdale
anymore." As for the social and moral issues raised by the spread of
resort-size, mostly unoccupied residences at a time of rampant
inequality, Niami deflects the question, preferring to focus on the
hundreds of local jobs that his projects have created.
Niami
might just take his dump trucks and go play elsewhere. Lately, he's
become convinced that the very spec boom he helped spawn has caused land
in L.A. to become "ridiculously overpriced." And once he has his
behemoth built, he's considering bringing his formula to Miami and Napa
Valley—and even to regulation-heavy San Francisco,
where he's looked at property in Presidio Heights. In the Bay Area, the
target buyers will be tech titans likely to use the houses as their
main residences. Would it make Niami feel better to know that the owners
of his mammoth masterworks will actually be living in them? "No," he
says. "It doesn't make a difference as long as they pay the money."
High Overhead: The Half-Billion-Dollar House at a Glance
- About half of the tennis court had to be built on pilings to account for the land's contours. This niche will have a covered viewing area and a fire pit.
- The infinity pool for the guesthouse, which, when built, will be 5,000 square feet itself.
- The motor court and the main house's entrance hall; a fire display will greet guests as they step inside.
- The gigamansion's main guard gate (there will be a separate area, with monitors, for keeping an eye on the whole estate).
- The property will be surrounded on three sides by a moat and other water features, which will make the whole thing appear to be floating.
- The "sky deck," as Niami refers to it, will have a putting green, a bar, a lounge area, and covered loggias.
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