You would think that the ultra high end real estate market has peaked. And you'd be mostly correct to think that. However, a handful of ambitious developers are forging ahead building some of the most expensive and enormous homes in the country. Several of these spec mega mansions are in Los Angeles. These developers are building over the top houses that are monuments to excess and sell for hundreds of millions – the priciest hit the market at $500 million.
One of the developers is Bruce Makowsky, whose spec home is on the market for $188 million. Makowsky first made his fortune selling leather bags on QVC. Raj Kanodia is another Los Angeles developer with a $180 million spec mansion in Bel Air to sell. Kanodia also made his fortune outside of real estate. He's a well known plastic surgeon that specializes in nose jobs. Kim Kardashian is one of his patients. Scott Gillen made the money to build his $85 million spec mansion in Malibu by directing commercials for BMW and Mercedes Benz. Nile Niami, who is building The One, a $500 million house being built in Bel Air and Opus a $68 million house in Beverly Hills, did special effects in the makeup department for low budget horror films.
Nile Niami a(Photo by Araya Diaz/Getty Images)
Niami is a particular kind of character. He is 50 with a deep tan. He recently returned from a celeb-studded fasting retreat where he dropped 11 pounds for his trip to Burning Man. He lives in a 10,000 square foot home with a 1970s-esque black leather bed and a collection of vintage Playboy magazine covers. He has considered pitching his own reality show called "The Mansion Maker." The only thing that stopped him from taking his brand to TV was one of his investors, who threatened to pull his funding if he went on TV. Niami finds the whole spec developing thing so stressful that he’s launching a fast casual rolled pizza chain in 2019 to have a second income.
Table of Contents
- Developers Behind the Mega Mansions
- Investment Strategies in Ultra Luxury Real Estate
- Unique Personalities in Real Estate Development
- Final Thoughts on the Mega Mansion Market
Developers Behind the Mega Mansions
Bruce Makowsky is a notable name in the Los Angeles real estate market. His spec home, listed at an astounding $188 million, showcases his knack for luxury. Makowsky has a background in selling leather bags on QVC, which helped him amass a fortune that he now invests in extravagant properties. Meanwhile, Raj Kanodia has made a name for himself with his $180 million mansion in Bel Air, drawing on his wealth as a plastic surgeon.
Scott Gillen and Nile Niami are also significant players. Gillen directed commercials for major brands and now has an $85 million mansion in Malibu. Niami, on the other hand, is building a $500 million house known as The One. This house is a testament to the heights of luxury and innovation in real estate.
Investment Strategies in Ultra Luxury Real Estate
Investing in ultra luxury real estate is not just about having the capital; it’s about strategic planning too. Developers often aim for a 50% return on investment but may settle for 30%. This balancing act is crucial for maintaining profitability while crafting homes that appeal to high-end buyers.
For instance, Kanodia has a loan from the Bank of Internet to finance his Bel Air project, while Niami’s $500 million venture is backed by the Credit Bank of Los Angeles and an unnamed Canadian investor. These financial strategies highlight the risks involved in the luxury market, where the stakes are incredibly high.
Unique Personalities in Real Estate Development
The personalities of these developers add a fascinating layer to the ultra luxury real estate landscape. Niami's lifestyle is particularly intriguing; he blends his work in real estate with aspirations of launching a fast casual pizza chain, showcasing his entrepreneurial spirit.
Makowsky’s past celebrity bidding wars, including one involving Beyoncé and Jay-Z, adds to his allure. His ability to create homes that attract such attention speaks volumes about his understanding of the luxury market.
Final Thoughts on the Mega Mansion Market
The mega mansion market in Los Angeles continues to thrive despite perceptions of a peak. With ambitious developers pushing the boundaries of luxury and creativity, these homes become more than just properties; they are cultural landmarks. As the market evolves, it will be interesting to see how these developers adapt and innovate to meet the demands of affluent buyers.
In conclusion, the world of ultra high-end real estate is not just about the homes being built; it’s about the stories of the developers, their strategies, and the unique personalities that shape this extravagant market.
