Beverly Hills Real Estate: Teardown Boom (and Tragedy) in Trousdale
This story first appeared in the July 4 issue of The Hollywood Reporter magazine.
When an LAPD officer was struck and killed by an out-of-control cement truck traveling down Beverly Hills' Loma Vista Drive in March, it was a tragedy. When only two months later a second officer was struck and killed 25 yards away on the same street by another careening cement truck, which hit the officer's car and overturned, an outcry ensued that made headlines for weeks.
What escaped most news coverage is the development rush in the star-studded Trousdale Estates neighborhood, where dozens of such trucks commute day in and day out to haul dirt and supplies.
In all, according to city records, 47 houses are under construction or renovation within the 410-acre hillside community of about 530 residences, where developers and homeowners are snapping up untouched midcentury properties to rebuild into modern abodes with values as high as triple their costs.
Among them is Oakley founder Jim Jannard, who is building a one-story house with a basement on two acres where he razed a Hal Levitt-designed midcentury house he had bought for $19.9 million five years ago. When completed, it could be valued at more than $50 million.
At 1088 N. Hillcrest Road, a developer removed a 1969 house and built a 4,700-square-foot modern spread with a saltwater pool.
"Construction is going crazy," says Branden Williams, a Hilton & Hyland agent who also is renovating two properties in Trousdale. "There's so much opportunity in the neighborhood and a lot of money to be made. It's the perfect storm."
As the real estate market improves, development opportunities seem ample in an area that is home to such names as Vera Wang, Elton John, Hedi Slimane and Ringo Starr. Many recent residents have been drawn because of their interest in restoring Trousdale's midcentury gems, a host of which were unimproved for decades. Designed by architects including A. Quincy Jones and Levitt, the houses sit on large plots that offer city and ocean views and boast coveted Beverly Hills addresses, many with asking prices as much as 70 percent lower than those in more established hill neighborhoods like the Bird Streets above Hollywood. But preservation is being outpaced by development.
"If you're building essentially the same house, then there's your profit right there," says Blair Chang, an agent at The Agency.
Agents say about half of the houses under construction are meant for sale, with most expected to be listed at more than $10 million. Producer-turned-developer Nile Niami is building at least three multimillion-dollar modern spec houses with basements, a way to maximize space in a neighborhood that prohibits two-story residences. All of them will have views.
"People want and will pay good money for views," says Michael Nourmand, president at Nourmand & Associates Realtors. "Developers are all betting big."
Big is right. Take, for example, a new 22,000-square-foot house on North Hillcrest Road with unencumbered views that soon will be listed at $65 million, a neighborhood record.
The level of building has escalated during the past several years. In 2006, Jennifer Aniston bought a Levitt-designed house for $13.5 million that she renovated and sold for $35 million five years later. Jeffrey Katzenberg bought a six-acre property for $35 million in 2009 that he razed and rebuilt into a 12,000-square-foot rustic residence.
This restored four-bedroom 1959 house at 1007 Loma Vista Drive has an outdoor fireplace and an original walnut bar.
While much is under construction, few renovated houses have hit the market. Celebrity hairstylist Sally Hershberger has listed hers for $6.9 million. Courteney Cox and David Arquette are in escrow to sell a $5.45 million residence they renovated then listed for $19.5 million in 2013.
Still, there are concerns about tearing down the work of well-known architects, some of whom appear on a list the city can use to determine whether a house should be preserved. Architecture fans hope certain properties are saved from demolition, including Elvis Presley's former estate designed by Rex Lotery. It recently sold for $14.5 million, only eight months after trading for $9.8 million.
In response to the fatal accidents, large development projects requiring heavy-haul trucks were put on hold. The California Highway Patrol is investigating both cases, but the problems seemed to lie with the trucks' ability to navigate safely down the steep street. Investigators suspect that in at least one instance there might have been a problem with the truck's brakes.
On June 18, Beverly Hills officials lifted the moratorium after devising a plan to make the roads safer. It includes requiring heavy-haul trucks to have secondary brakes and proof of an annual safety inspection. The city also implemented new truck routes and lowered truck speeds to 15 miles an hour. Officials have considered measures taken by other cities that limit construction within a given perimeter. In Santa Monica, for example, only one house within a 500-foot radius can be under construction at a given time.
Agents say such restrictions might dampen interest in Trousdale. "I think it would turn everyone from owner-users to the speculators off," says Rayni Romito Williams, a Hilton & Hyland agent.
Some, though, can see a benefit to limiting the amount of construction.
"My gut is saying there are too many homes coming at the same time," says Chang. "If I have 10 $20 million homes being built and coming on at different times, it will serve the builders well. If they come on at the same time, the market will pull back."
For now, the projects don't seem to bother residents. Frieda Berlin, a liaison at the Trousdale Estates Homeowners Association, says it is nice to see older houses get modernized.
"The construction itself is not a problem -- it's a hot neighborhood and to be expected," she says. "We like the area to be brought up-to-date."
Below: Before and after shots of a 1964 house redeveloped by Baron Steinbrecher into a modern 5,400-square-foot, four-bedroom mansion.