Asking-Price Optimism Leads to Big Real Estate Price Chops

Someone with a real-estate-cup-is-half-full point of view might argue the high-end market in the U.S. has never been better. And certainly there are an impressive number of recent examples of luxury properties trading at astronomical prices. In New York City, a 96th floor Midtown penthouse just went for $87.66 million and, in Los Angeles, a spec-built, regional-airport-proportioned, contemporary mega-mansion — it has an astonishing 20 bathrooms — was sold for $100 million, reportedly to billionaire private-equity powerhouse Tom Gores. However, someone with more of a cup-is-half-empty view of things could probably cite many more examples where high-end sellers with wild-eyed asking-price optimism are eventually compelled to drastically and sometimes repeatedly reduce the price to a more realistic figure.

Retired professional basketball player Scottie Pippen put his 13,500-square-foot waterfront mansion in Fort Lauderdale up for sale six long years ago with a pie-in-the-sky ask of $16 million. The price has dropped steadily, and the two-time Olympic gold medalist and six-time NBA champion just clipped off another $600,000, bringing the asking price down to $10.9 million. (For another $1.6 million, Pippin will toss in his 55-foot luxury boat.)

After three months on the market, Maroon 5 front-man and “The Voice” judge Adam Levine cleaved a bit more than $1.5 million off the original $18 million ask of his newly refurbished estate in Beverly Hills; nonagenarian “Scarface” and “Dog Day Afternoon” director Martin Bregman recently whacked two million dollars off the original $10 million price of his 4,000-square-foot New York City apartment; and the price tag of the fancifully contemporary Palm Desert hideaway of late talent manager and film producer Jerry Weintraub was toppled in one fell swoop from $16.9 million all the way down to $12.9 million.

The nearly 2.2-acre fixer-upper estate of “Rambo” franchise producer Mario Kassar, in the super-prime Holmby Hills area of L.A., came up for sale in late 2015 with an in-hindsight painfully rose-tinted $39.9 million asking price that was unceremoniously slashed to $32.5 million before it was dramatically reduced by another $5.5 million to $27 million. (The property was re-listed this week with a new broker and a new and higher asking price of $29 million.) Meanwhile veteran television executive Fred Silverman got even more aggressive when he slashed the asking price of his 2.6-acre compound in the lower-Mandeville Canyon area of L.A.’s Brentwood area by a whopping $7.5 million, from $30 million to $22.5 million.

As pearl-clutching as these gigantic price cuts are, it’s retail fashion tycoon Tommy Hilfiger who wins the brass ring when it comes to preposterously sanguine asking prices that not infrequently lead to elephantine price reductions. In July 2008, Hilfiger paid a bit more than $25.5 million for a nearly 6,000-square-foot penthouse at the Plaza in New York City that he flipped back on the market two months later at $50 million. With no takers, the lavishly appointed four-bedroom and 4.5-bathroom penthouse was soon taken off the market, only to return in the fall of 2013, with an even more utopian asking price of $80 million that dropped to $75 million and then to $68.95 million before it was chopped by $10 million to its current price of $58.9 million.

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