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$ 500million mega mansion defaults on $ 100million in debt, forcing sale

In an Instagram post last summer, Nile Niami, the developer of the project, touted the 105,000-square-foot home as having seven swimming pools, a 50-car garage, a 10,000-bottle wine cellar, and even its own nightclub. . Promoted as the world’s largest and most expensive city property, “The One” was expected to hit the market for $ 500 million, according to the video Niami posted on Instagram. But he suffered many delays and complications and now faces a court-ordered sale to pay off debts.

Niami borrowed $ 82.5 million from Hankey Capital in 2018 to continue building the house. But in March of this year, Hankey served a notice of default sending the property to a foreclosure sale. Niami had 90 days to pay or renegotiate the debt, which stood at more than $ 110 million, according to court documents.

With no payment made in July, the house was placed in receivership, which is an alternative to foreclosure for complex real estate transactions. The receiver, Theodore Lanes of Lanes Management Services, is responsible for accounting for debts on the property, preparing and then selling the property and, ideally, repaying lenders and creditors with the proceeds.

Hankey Capital declined to comment on the default or the receivership. Nile Niami did not respond to a request for comment.

But despite Niami’s promises that the property is almost complete – in a video tour of the house released in April, he said it would be “probably another four weeks” – there remains a complicated list of points and the property is not ready for the market, according to Lanes’ first report filed with the court.

Some elements The routes described are quite typical final details when building a house – the gas company will not provide service until a certificate of occupancy has been issued, for example. But others are peculiar to the property: permission to build a commercial-grade catering kitchen has been refused and this space remains empty.

Lanes said in an email to CNN Business that he is always learning new issues to tackle, including getting plans and permits and making deals with artists whose work is in the house, a company staging furniture and the gardener.

“It’s a pretty long list,” he said.

Other issues facing the property, according to the report: Insurance lapsed in early 2021, challenges for social media users to sneak into property led to intruders.

“It is clear that anything under security would be given priority,” Lanes said in his email. “As for the other projects, they are all evaluated according to the requirements to obtain the certificate of occupancy. If they are compulsory for the occupancy certificate, they have priority.

The house also has more than $ 2 million in unpaid taxes and bills to sellers for concrete, air conditioning and scaffolding, according to Lanes’ report.

“It’s a very complicated property with quite a few open issues,” Lanes wrote in her report. “Right now, the goal is to get full insurance and develop a timeline and budget for obtaining the certificate of occupancy to maximize value and make the property more marketable.

‘The one’

Nearly a decade in the making, the home sits atop a hill in Bel Air, overlooking the Los Angeles Basin. The colossal house has 20 rooms, including eight staff rooms and a three-bedroom guesthouse, around 6 elevators, a library, cigar lounge and candy room, according to a published two-part house tour. on YouTube in April.

The house is advertised as having a four-lane bowling alley, a 50-seat cinema room, a putting green, a wellness center and gym, a beauty salon, a juice bar and a tennis court. .

Despite Niami on several occasions teasing that the house was weeks away from arriving on the market, she never arrived.

Instead, over the past year, Niami has offloaded other properties – at reduced prices.

Earlier this year, he sold a West Hollywood mansion for $ 26 million, well below the previously asking price of $ 35 million, according to real estate records reported on Realtor.com. In April, he sold a Bel Air mansion for $ 36 million, just over half of its original price of $ 65 million in 2018, according to Zillow.
Other notices of default have also arrived, including one on a $ 10 million debt on a house in Hollywood Hills and another on a $ 23.4 million debt on a house in Bel Air, according to the Los Angeles. Times.

And Niami is being sued by other creditors looking to get their money back. Real estate company Compass is suing for non-payment of a $ 200,000 loan it took out while trying to sell another house in Bel Air, according to court documents.

It is not known at what price “The One” will ultimately be listed, or when it will hit the market.

“I am always evaluating the proposals and strategies of various potential listing agents,” Lanes said in an email.

While the property had yet to go to market earlier this year, a Google Forms app was available to potential buyers. Beyond the contact details, he only asks one question: “Which influencer have you heard about?”
Several social media influencers have already featured it. Last April, Niami gave a home visit to YouTube personality Michael Blakey. The tour offers a glimpse of the nightclub with VIP area and a tour of the 4,000 square foot master suite, with its own swimming pool.

“I gave them everything here,” Niami said in the video. “We have everything everyone could want in this house.”

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