Foreclosure threat looms for Bel-Air mega-mansion
Lender takes first step with notice of default served to developer of ‘The One.’
For years, spec developer Nile Niami has teased “The One” — a 100,000-squarefoot mega-mansion in BelAir that he hoped to sell for $500 million. But his plans are now in peril.
Niami, known for his brazen personality and wildly ambitious real estate projects, borrowed $82.5 million from Hankey Capital in 2018 to build the extravagant home. Over the last three years, that debt has ballooned to more than $110 million, and Hankey wants its money.
According to a document obtained by The Times, the lender just served Niami a notice of default on the prized property, which is considered the first step in the foreclosure process. If Niami can’t repay the loan in 90 days, Hankey could force a sale of the home.
Listing agents Rayni and Branden Williams of Williams & Williams at Beverly Hills Estates and Aaron Kirman of Aaron Kirman Group at Compass could not be reached for comment.
“We felt the owner of ‘The One’ was distracted from the job at hand, which is to bring the biggest and best house in the United States to market for sale,” said Don Hankey, chairman of Hankey Investment Co. “We hope our actions will kick off the official listing.”
There are multiple solutions for Niami to avoid a forced sale of the property, which include paying back all or at least some of the loan or coming to an alternative agreement with the lender. But such sales, even for prized properties, are not without precedent.
In 2019, the owners of the famed Mountain in Beverly Hills — a 157-acre lot considered the city’s finest piece of undeveloped land — faced a foreclosure sale due to $200 million in unpaid loans. They tried to delay the sale by declaring bankruptcy, but their efforts were unsuccessful, and the land was auctioned off outside a Pomona courthouse.
Default notices are nothing new for Niami. He received two in 2020 alone: one for a debt of $10 million on a property he owns at 1369 Londonderry Place in the Hollywood Hills, and one for a debt of $23.4 million on a mansion at 10701 Bellagio Road that he’s currently trying to sell for $59 million in Bel-Air.
He took out a $200,000 loan from Compass for a separate Bel-Air property he was trying to sell in 2019, and the real estate company sued him in October for failing to repay it, records show.
Last year, he told the Wall Street Journal that there have been multiple times when he was forced to stop construction because of a lack of financing. He also said that he has funded construction with cash from sales of other properties.
Profitable sales have been hard to come by for Niami lately. After listing an over-the-top Beverly Hills home dubbed “Opus” for $100 million, he sold it last year for $38.3 million. The buyer turned out to be Joseph Englanoff, one of Niami’s lenders for the project. Englanoff took control of the property, rebranded it and sold it for $47 million later that year.
In 2019, Niami tried to sell a West Hollywood home with a glass-bottomed pool and cryogenic chamber for $55 million but couldn’t find a buyer. Late last year, he put the property into bankruptcy.
All his homes boast otherworldly amenities — champagne vaults, animal skeletons, for instance — but in terms of raw ambition, the One takes the cake. Even among the colossal estates of Bel-Air, the house is over the top.
The estate stretches across eight acres on a promontory lot and centers on a 100,000-square-foot palace that looks more like a futuristic spacecraft or a Bond villain’s lair than a home.
Niami ended up axing some of the amenities he teased, including a jellyfish tank and a frozen room with an ice bar, but he still saved space for a nightclub, fourlane bowling alley, 50-seat theater, juice bar, putting green, golf simulator, beauty salon, yoga platform and five swimming pools. The primary suite alone is bigger than the average U.S. home at 4,000 square feet.
He originally planned to list it for $500 million in 2017, but the home still hasn’t hit the market — a costly delay since the property’s annual tax bill comes in at more than $1 million. Last summer, he posted a cryptic video on his Instagram account declaring it was 10 weeks away from completion, saying, “Seven years ago, I had an idea to create the biggest, most expensive house in the urban world: The One Bel-Air. And I did it.”
The home still has not officially surfaced for sale, but Niami did recently release a Google Forms application that asks prospective buyers to supply their name, email address, phone number and proof of funds along with the question, “Which influencer did you find out from?”
In addition to the outstanding loans, Niami has also been fined five times for parties at his properties that violated L.A.’s coronavirus social distancing orders, according to the Daily Mail. The five violations made up a third of the 15 total fines handed out by the city from April to August last year.