A Los Angeles mega-mansion that was poised to be the most expensive home sold in America, with a $500 million price tag, was pulled from auction Wednesday as its developer and lender continue to fight over the sale of the home.
Developer Nile Niami, known as ‘The King of LA mega-mansions,’ filed for Chapter 11 bankruptcy protection for his Crestlloyd company to stop the sale of the home at a Los Angeles Country Superior Court auction after he defaulted on a $106 million debt owed to Hankey Capital, which belongs to billionaire Don Hankey.
Niami’s successful bid to stop the foreclosure sale was the latest in a nearly year-long dispute with Hankey over the 105,000-square-foot Bel Air estate, known as ‘The One.
‘I’m disappointed,’ Hankey told Bloomberg. ‘All we want is to get our capital returned.’
The sprawling complex houses a bowling alley, private theater, a night club, multiple pools, a jacuzzi, a salon, a gym and an underground garage with two vehicle turntables.
‘The One’ mansion in Bel Air, California, would have been the most expensive mansion sold in America at an estimated $500 million. The home’s developer, Crestlloyd, filed for bankruptcy
Nile Niami, right, defaulted on a $106 million debt owned to billionaire Don Hankey, of Hankey Capital. Hankey has pushed for the home to be sold on a LA County auction
The home was expected to sale for $164 million at a LA County Superior Court auction
The mansion has nine bedrooms and was set to have spaces for charity galas
It also houses its own built-in movie theater
Lawrence Perkins, the newly appointed manager of Crestlloyd, said the developer would be focusing on making sure the home is completed, marketed and seen by prospective ‘high-level’ buyers.
He said the plans would be put forth soon in Bankruptcy court, where Hankey could seek to have the process halted in order to restart the auction sale after November 29, the Los Angeles Times reported.
Niami bought ‘The One’ in 2012 and has spent the last nine years promising to build the grandest home in the U.S. and flip it for a profit, but he could not finish the construction nor find a buyer since it went on sale in January.
The project for the nine-bedroom estate was originally slated to be finished in 2017, but the construction has been set back by a series of financing and building problems, including scrapped plans to include a jellyfish tank.
Developer Nile Niami was once known as the most successful mega-mansion developer in LA
The unfinished mansion has its own bowling alley
Niami had plans to rent the some spaces of the home off as an entertainment venue
The home is 105,000 square-feet with a sprawling number of rooms
Niami kept making additions to the home as a bid to create the grandest mansion in LA
Hankey has claimed Niami had grown too distracted to sell the home during the pandemic.
Between April and August of last year, Niami was cited five times by the City of Los Angeles for having illegal COVID parties at various houses. The complaints accounted for a third of all of the complaints in the city over that period.
Neighbors told DailyMail.com it was like living ‘in a nightclub’ and that maskless ‘punks’ were ferried to the homes on buses.
Niami had denied holding the parties and said he was cooperating with the city.
This spring, after Niami defaulted on his debt to Hankey, he proposed living in The One and turning it into an entertainment venue for concerts and boxing matches.
Niami even had plans to turn the home into a film studio and commercial venue, using it to host new Netflix shows and start-up companies.
Hankey turned down the plan.
Hankey, a billionaire who serves as the CEO of the Hankey Group, said he wanted to recoup the millions he invested in Niami’s The One mansion development
Niami has spent the last nine years working on developing the mega-mansion, pictured above
Hankey and several other lenders, who are owed tens of millions of dollars, went on to court claiming they weren’t being paid what they were owed, and the home was eventually placed in a receivership in September to sell the it and recoup the lenders’ losses.
However, Niami and Crestlloyd complained that the receiver, Ted Lanes, was undervaluing the home, which was expected to be sold for only $164 million in an October 17 auction, Bloomberg reported.
Crestlloyd ‘believes that the receiver has hampered efforts to complete the property, as well as to market, show, and sell the property in its current state,’ the company said in its bankruptcy filing.
Although a sale for the home was approved with two brokers at $225 million, Hankey decided to push for the auction sale instead, prompting fellow lender Joseph Englanoff to seek a temporary restraining order to block the auction.
Englanoff, whose Yogi Securities Holdings lent Crestlloyd $30.2 million in 2018, accused Hankey of trying to take ownership of the mansion through the auction or of possibly trying to take all the proceeds for himself if it was sold.
The home’s sale is currently blocked until November 29
It houses a large outdoor pool and tanning area
Niami once pitched the idea that he could live in the house and rent the space off as a venue
Although a judge denied the temporary restraining order, the auction had been pushed back and delayed until Wednesday.
On top of the money owned to lenders, Crestlloyd has several million dollars in unsecured debt attached to project.
The company owes $750,000 to Creative Art Partners for the art in the home, $275,705 to Vesta for the furniture and accessories and $400,000 to Branden Williams, the home’s listing agent, according to the bankruptcy filing.
The outstanding debt and failure to sell the home personifies Niami’s fall from grace as LA’s most successful mega-mansion developer.
The Wall Street Journal previously reported that Niami had five unsold mega mansion in his portfolio.