A volatile court case, a last-minute offer, and a poorly attended auction is now the legacy of Beverly Hill’s mountain.
Initially dubbed as the Beverly Hill’s most expensive yet underdeveloped land, this 157-acre real estate made new when it was listed for a whopping 1 billion dollar in 2018. Last Tuesday, it went for a mere $100000 at an auction, which is a small fraction of the total that the property still owes.
This represents a 99 percent markdown that also comes with a few fine prints. Any other person interested in this piece of the earth would have been hell-bent on paying off the loan, but not this specific purchaser has to sort out the loan.
The new owner is Mark Hughes, founder of Herbalife foundation, which was the original owner. Mark Hughes set this whole thing alight by opting to dispose it in 2004 to Chip Dicken, an Atlanta investor.
The investor sought a 45 million dollar loan from Mark Hughes to purchase the same property, and this loan has grown to 200 million,
including fees and interest. A few years ago, the Dicken relinquished ownership to another limited liability company run by Victor Franco.
This limited liability company was not able to settle its debts. It secures a few capital partners, then tried, and failed to declare bankruptcy in accordance with chapter 11. This led Mark Hughes to institute an auction with the hope that they would either recover their loss or purchase the property back. This meant they would lose 200 million initially owed.
Of the 20 attendees at the auction, about 10 were regulars dressed casually with umbrellas and lawn seats. They came to the auction for their regular sales slates that consists of cheap foreclosure homes in this surrounding area.
The ended as soon as it began. The auctioneer in charge of the process inquired if anyone was ready to place a bid. No one bothered because any purchaser who managed to buy the property would have to deal with the debt as well.
The auctioneer announced that Mark Hughes would place a $100000 credit bid, meaning the property would be paid for by the debt owed. No protests came forth, and the 1 billion dollar mountain was quietly sold for just $100000.