But At What Price?

Real estate agents spend a lot of time thinking about pricing properties. In any office, “Do you have a second?” is usually followed up with a pricing opinion question. Agents discuss, debate and defend the merits of pricing based on their favorite methods, be it average sold price per square foot, sales price to list price ratio, or days on market compared to… “Hey, did you catch ‘The Americans’ last night?”

All of that said, where one prices a property is a function of two things: market forces and ego.

Let me explain.

A Saferoom By Any Other Name

Kim Kardashian’s recent robbery in Paris at gunpoint (in which she was relieved of $9 million of jewelry) brought to mind an article in The Hollywood Reporter about safe rooms being the newest trend in luxury real estate. Knowing that no harm came to Ms. Kardashian, I found this a bit amusing as: a) I personally never travel with more than $5 million in jewelry ($9 million is just ostentatious), and b) the “Safe” or “Panic” room is the latest name for a feature that’s been around for at least one century (if not many more).

The Mystery of the Vanishing (Good) Restaurants

I’m not 100% behind the plastic bag ban (see why in this Wired.com article), but I do have to admit not having to choose between “paper or plastic” has freed up enough brain cells so I can tackle the important question of “Where should I eat?”

This is a question (more of a conundrum) that I deal with a few times a week as I try to schedule meals with friends, clients and colleagues. On the days I work out of my Brentwood office, dinner I prefer to stay west of the 405 (this is a function of traffic and not an indictment of areas further east), but this has become a harder and harder task as many of my usual haunts have gone out of business.

And Yet Another $200 Million Listing…

As you’ve probably heard, Petra Stunt has put her mansion on the market for $195 million.

There are a few things that caught my attention about this listing, and not one of them was the price ― and this lack of surprise is the main thing that caught my attention.

First off, this is just one of the several mega-million dollar listings that have come on the market of late. And where a few years ago a price tag like this would have made heads spin like Linda Blair’s in the “The Exorcist,” among my clients and colleagues this listing is eliciting yawns. Sure, we’ve spoken about it, but usually just in passing:

Rolling Along In My Own Lane

What’s all this stuff I keep reading about bowling alleys?

I’m talking about all the bowling alleys I see included as amenities in a bunch of high-end listings of late. For example, Petra Stunt’s $195 million dollar estate has a bowling alley. (It also has a beauty salon, a gym, a wine tasting room, and massage and tanning rooms. My question is: are all of these rooms  within walking distance to each other, or does one  drive to them in the Formula One cars I like to imagine the racing heiress keeps on hand?)

Many other high-end listings, as well as historic buildings, list bowling alleys as amenities. This begs the question: Who the heck is doing all of this bowling?

A Santa Monica Hotel And How LA Handles (Or Doesn’t Handle) Change

An article in the NY Times about the vociferous opposition to Disney’s rejiggering of a theme park ride got me thinking about mental health — mainly, my own.

Los Angeles is a town of contradictions: The same people who insist on eating only natural organic foods also happily inject non-organic silicone into their laughs lines (to the point that they look quite unnatural). This behavior largely goes without comment, which is really not surprising when you consider that as “the city of dreams,” people come to LA to become someone else: Cary Grant arrived in town as Archibald Leach; Michale Caine was Maurice Micklewhite; and Angelyne was… Well, let’s just move on.

It’s Only A Paper Moon, And It’s Only A Paper Loss

Take any basic accounting class, or go to Vegas for the weekend, and you’ll soon get the concept that financial losses are bad. Which is why you might scratch your head when I tell you that some of my most successful property investment clients ask me to find them properties that will show a loss.

I was recently discussing this concept with a colleague, when he smiled knowingly and said, “I get it, your client’s getting divorced and wants to hide some money.” After assuring him that this wasn’t some film noir-style fraud scheme, I explained that my client was talking about “paper losses.” The quizzical tilt of his head told me that I had some ‘splaining to do.

A Multi-Family Investment Portfolio, One Unit At A Time

Somehow, I never get to be the Top Hat.

I have clients who want to own investment properties. And even though they may own several personal and vacation homes, the idea of putting all of their property investment eggs in one building basket is counter to their successful track record of spreading the risk across different assets.

Regarding real estate, individual investors generally think of the three most common property holdings: office buildings, shopping centers and apartment buildings. And the easiest of these investments to manage and understand is the apartment building — people pay rent, you subtract your expenses and voilà, there’s your net taxable income. (The CPA then works his/her magic by factoring in mortgage interest and depreciation deductions, but that’s something for the next day.)

Bragging Rights Of The Fraudulent Kind

Enjoying my morning coffee and   LA Times, NY Style.

I never thought the Treasury Department’s thresholds for reporting the people behind cash purchases of residential real estate would make me face my bi-Coastal allegiances.

Having grown up in New York, and having lived in Los Angeles for more than half of my life, I’m conflicted. I read the New York Times (electronic edition) every day. I also read the Los Angeles Times (print edition), which, jonesing for a NY experience, I fold in the manner I learned in fourth grade so as to more easily read it on the subway. [That this was taught to me in school as part of the curriculum says volumes about the veneration of The Times. But I digress…]

I identify as a New Yorker, especially when it comes to claiming unparalleled authority on topics such as bagels and pizza. Even more so, I wear the mantle of having grown up in Manhattan with unwarranted snobbery over those from Long Island or New Jersey ― unwarranted as I was simply lucky to have parents cool enough to live in the city, and did not attain that rank of my own merits.

Is There Too Much Housing In Downtown LA?

Even more lights are slated to join the DTLA skyline.

LA is a city with an identity crisis, mainly because it has more identities than “Sybil.”  The “city” part of LA is the downtown area that reached its glory days in the 20s and 30s, hit a decline in the post war years, laid fallow for about 50 years and began its renaissance starting in the late 90s. For what’s supposed to be the economic hub of the city, people can go their whole lives without setting foot in downtown (and truthfully, they’re missing out, but that’s a topic for another day).

Downtown has had a huge residential population boom, going from approximately 14,000 denizens to more than 50,000 over the past 15 years. The tipping point was the introduction of a name brand supermarket that allowed people who always thought it would be cool to live downtown, but were wary of the inconvenience of not being able to get the emergency carton of milk for their Sunday morning coffee, to feel more comfortable. As more units came on line (either through new construction, or the redevelopment of iconic buildings) restaurants, stores, clubs and even a Soul Cycle followed. Suddenly, downtown was a viable place to live. It may also be a victim of its own success.