Beverly Hills Real Estate: Dollar-by-Dollar Breakdown of a $4 Million Renovation
A top real-estate-agent couple, who have put $4 million into a $4 million teardown, explain how such a big investment can translate into a huge payout.
This story first appeared in the July 4 issue of The Hollywood Reporter magazine.
How does one turn a profit transforming a midcentury house into a modern manor? For Rayni Romito Williams and her husband, Branden Williams, it took $8 million and more than two years. The couple, who work together as agents at Hilton & Hyland, are remodeling their Trousdale residence as well as one nearby they plan to sell. They visit the properties daily and have hired project managers to oversee them eight hours a day.
Romito Williams spoke with THR about how the development has penciled out for their own house, especially because they have put as much into it as they paid for it. It’s a sign of faith in the neighborhood and the recovery of the L.A. market.
“People are now very aware of how fabulous Trousdale is, and then also people have confidence to build,” she says. “We kept saving until we could get into the game.” The house should be completed in 2015.
PURCHASE PRICE: $4 Million
In 2010, the couple bought a 1960s Jack A. Charney-designed residence on Hillcrest Drive for $4 million. About two years later, they decided to remodel it into a 5,200-square-foot house to include 12-foot ceilings and open glass-panel exterior walls. They began with a $1 million renovation budget but have ended up north of $4 million. “As the process goes on, you realize if you are going to do XYZ, why not keep going and make it a dream home?” says Romito Williams. The couple was able to avoid demolition and use the existing bones. That saved $50,000 to $100,000, the average cost to raze a property — but just barely.
ARCHITECTURE PLANS: At least $200,000
While every architect has a different payment method, on average a set of plans can cost $200,000 to $1 million. The couple declined to provide specifics but say their home-plan costs fell in the middle of that range.
CITY FEES AND TAXES: At least $270,000
Typically, the architect will take care of pulling permits from the city. But builders still must pay city fees, which can run tens of thousands of dollars. The couple’s taxes also were several hundred-thousand dollars, says Romito Williams. In Beverly Hills, homeowners renovating more than 50 percent of a house are hit with an additional tax (Romito Williams’ was about $70,000).
CONSTRUCTION AND PROJECT MANAGEMENT: At least $3 Million
The typical cost of building, including materials, can run $300 to $1,000 a square foot. For the Williams’ home, it has cost at least $600 a square foot. Says Romito Williams: “You are faced with choices — you can do mediocre work or fantastic work. But it costs you.”
Removing and repouring the foundation. “You start remodeling — it’s like Pandora’s box,” says Romito Williams. “The next thing you know, all the ducting and groundwork has to be ripped out because it has asbestos, and now you need a new foundation.”
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If the Williamses were to stage the property (they plan to stay and furnish it), then renting furniture can cost an upfront fee of about $30,000, then about 1 percent of that amount each subsequent month.
NEW POOL: $250,000
The couple added a 60-foot infinity lap pool at the edge of the property.
A landscaper can cost $100,000 to $1 million. Romito Williams says her bill rang up to about $200,000.
TOTAL COST: $8 Million
POTENTIAL LISTING PRICE: $10 Million to $13 Million
The couple, with a baby due in August, plans to live in the house. If they wanted to sell it, Romito Williams says she would list it in that range.
POTENTIAL PROFIT: $2 Million to $5 Million