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This story first appeared in the Feb. 27 issue of The Hollywood Reporter magazine.
Short-term rentals of luxury homes in the L.A. area generally have been for vacations in Malibu. But that’s changing, say local agents, as more and more major celebrities and the uber-wealthy choose to lease multimillion-dollar houses in such areas as Bel-Air and Beverly Hills instead of booking prestige hotel suites.
In 2014, Beyonce and Jay Z leased a $45 million Holmby Hills estate built on spec. The seven-bedroom home, listed by Kurt Rappaport at Westside Estate Agency, includes a wine cellar, two libraries and a theater. And it offered possibly the most important benefit: privacy. “You can do what you want, like hang out by the pool — because it’s your pool, and you aren’t there with other hotel guests,” says Michael Nourmand, president at Nourmand & Associates Realtors. “No one is taking a picture of you on their smartphone.”
Other names who recently have leased mega-mansions on the market are Adele and Lady Gaga. It’s a particularly popular strategy during awards season. “It’s not uncommon to get a celebrity who is here for the Oscars or Grammys and wants to play for a week or a month,” says Billy Rose, a founder at brokerage The Agency. The trend has been accelerated by the rise of peer-to-peer leasing sites such as Airbnb and VRBO (Vacation Rentals by Owner), which have brought the convenience of home rentals to the forefront. Some high-end homes can be leased through these channels, but many such rentals are executed through real estate agents. (Sotheby’s agent Barry Peele also gets into the leasing game personally — when he’s out of town, he rents his renovated midcentury Beverly Hills home for $60,000 a month. Recently, he leased it to a British recording artist during the Grammys.)
“Instead of spending $20,000 to $30,000 a night to take out an entire floor at The Beverly Wilshire, you can get a ridiculous house with all the amenities for $100,000 a month,” says Hilton & Hyland agent Josh Altman.
Indeed, high-end leases — which can include anything from dishes and linens to butlers and personal trainers — generally run from $10,000 a night to $600,000 a month in Los Angeles. Jay Z and Beyonce’s Holmby Hills lease cost about $200,000 for the month.
Such deals often make sense for wealthy sellers who might be carrying costs on a property. “With the higher end, sometimes homes won’t move that fast,” says Altman. “They can be sitting on the market for over a year, so a lot of these mega-houses are for lease. We say, ‘Let us try to sell it first, and if it doesn’t sell in the first eight weeks, we can lease it.’ “
One home available for sale or lease is the former residence of Don Johnson and Melanie Griffith, a nine-bedroom traditional in Beverly Hills built for The Wizard of Oz actor Bert Lahr. It is listed by The Agency’s Mauricio Umansky for sale at $28.5 million or for lease for $100,000 a month.
The priciest, by far, is 9505 Lania Lane, a 53,000-square-foot villa built in Beverly Hills by developer Mohamed Hadid and owned by real estate investor Jeff Greene. It hit the market in November for a whopping $195 million — the highest-priced home for sale in the U.S. It leases for an impressive $475,000 a month.
Leasing also can lead to a sale. Glee creator Ryan Murphy leased Diane Keaton‘s Beverly Hills home before buying it a few years ago. Dr. Dre leased, then bought (and recently sold, for $32 million) a home in the Hollywood Hills’ Bird Streets. “They want to feel out the area before they make a major purchase of $40 million or more,” says Branden Williams at Hilton & Hyland.
Leasing to a celebrity also can add quick luster to a listing. Says John Aaroe Group agent Sally Forster Jones, “Ultimately, more interest potentially leads to a higher sales price.”
Beverly Hills’ Palazzo di Amore, complete with vineyard, is the highest-priced home in the U.S. It’s listed by Joyce Rey at Coldwell Banker.
This Channel Road 12-bedroom in Santa Monica has been available for lease since late 2013 and will be listed by Rose for sale in March.
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