Versace mansion auctioned for $41.5 million
09/17/2013 10:34 AM
09/17/2013 9:23 PM
The former Versace mansion fetched a top bid of $41.5 million at a high-profile auction Tuesday from New York’s Nakash and Gindi families, who own the Hotel Victor next door.
Donald Trump — who deployed his son, Eric Trump, to bid on his behalf at the court-ordered bankruptcy sale — bid as high as $41 million for the iconic South Beach estate, making him the back-up bidder in the unlikely event the top bidders don’t follow through on the all-cash deal.
At a bankruptcy-court hearing set for Wednesday morning, a judge will be asked to approve the sale of the lavish 10-bedroom, 11-bath mansion, known as Casa Casuarina.
Although the Mediterranean-style estate at 1116 Ocean Drive won’t get the Trump name, it could end up with Versace’s moniker again — that is, if the new owners can cut a deal with the family of Italian designer Gianni Versace, who was shot to death on the steps of the property in 1998.
Joe Nakash, chairman of Jordache Enterprises, said at a news conference on the mansion steps after the auction that his group wants to operate a boutique hotel there, using the famed Versace name. The hotel would operate in tandem with the Hotel Victor next door, which recently reopened after a major renovation of the 91-room, Art Deco property.
“If not, we’ll use the former name, or a new name,” said Nakash.
The Hotel Victor owners have been after the Versace mansion for some time. Their VM South Beach LLC acquired the mortgage on the property in December 2011 from a German bank, WestLB. VM South Beach’s principals include the Nakash interests and Gindi Capital, controlled by the Gindi family.
“They’re so thrilled they can now combine these properties to offer top-quality entertainment and hospitality to their customers,” said Ralph Bekkevold, a shareholder at Greenberg Traurig in Miami, who represents the winning bidders.
Weeks before the auction, which was closed to the public and media, VM South Beach LLC put in a stalking-horse bid of $25 million, setting a minimum for others. The bidding Tuesday went in $500,000 increments.
A third bidder who had put up a $3 million deposit to participate in the auction — Palm Beach Polo and Country Club owner Glenn Straub — made a single bid and stopped, leaving the Hotel Victor interests and Trump to duke it out, according to Lamar P. Fisher, of Fisher Auction, which conducted the auction on the site.
Trump, the real-estate kingpin and TV reality-show celebrity, said it was no big deal that he didn’t get the trophy mansion. “We sort of thought it was a $25 million property,” Trump told the Miami Herald afterward in a phone call. “I thought it would be a nice little retreat, but nothing very important.”
Experts say Trump might have used the South Beach oasis to round out his offerings to wealthy South Florida tourists. He owns Mar-a-Lago in Palm Beach, the former estate of Marjorie Merriweather Post, which he turned into a private club and spa. Last year, Trump acquired the Doral Golf Resort out of bankruptcy proceedings and renamed it Trump National Doral. The sprawling Doral resort is in the midst of a $250 million renovation.
Tuesday’s auction drew a sizable crowd of journalists, who staked out the mansion’s front entrance, as well as the occasional curious tourist passing by.
The exterior of the building is deceptively simple, but the inside is all about grandiosity. Versace purchased the property in 1992 and spent $33 million in renovating it, adding a wing and making additional upgrades. Each room is decorated in a fantasy theme.
The house, which has hand-painted murals and ornate statues throughout, boasts a 54-foot, mosaic-inlaid pool lined in 24-karat gold.
Peter Loftin, the owner, placed the corporate entity it is held in, Casa Casuarina LLC, in Chapter 11 federal bankruptcy proceedings July 1 to stave off lien holder VM South Beach’s efforts to appoint a receiver and wrest control of the sale process from him.
Loftin, a telecom entrepreneur, bought the property in 2000 for $19 million. Until May, Barton Weiss, a well-known Miami restaurateur, had leased the property, operating it as The Villa By Barton G, a 10-room boutique hotel.
Loftin listed the property for sale in June for $125 million with luxury real-estate brokers Jill Eber and Jill Hertzberg, who operate as The Jills Team at Coldwell Banker. He later pared the price to $100 million and then $75 million, but drew no buyers. When it was set for auction, the Jills joined Fisher Auction in marketing the property to wealthy prospects around the world.
Joe Grant, Loftin’s attorney, said late Tuesday: “It’s a somber day for him. He’s obviously attached to the property from living there.” Grant said after all the property’s debts are paid, “he’s going to walk away with some money in his pocket.”
A 9.9 percent share of the proceeds due Casa Casuarina LLC will go to the bankruptcy trustee for Rothstein Rosenfeldt Adler, the defunct Fort Lauderdale law firm of convicted Ponzi schemer and attorney Scott Rothstein. Rothstein, who married his wife Kimberly at the mansion, had invested in Casa Casuarina LLC.
“We feel it brought fair market value,” Fisher told reporters. “It was exposed worldwide.”
“This is one of the most-recognized properties in the world. It’s iconic,” added Jill Eber. “So it’s always hard to identify where the value would end up.”
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