Thursday, July 30, 2009

Palm Beach Real Estate Roulette

The Parc Monceau skyline. Built and developed by Clarence Mack during the early 1960s, the Parc Monceau subdivision's Neo-neoclassical houses are often called Palm Beach Regency.
by Augustus Mayhew

An investment company owned by philanthropist Bill Gates may have bought five multi-million properties, according to a Palm Beach Post columnist, three in nearby Jupiter Island and two on Palm Beach. Bought by Washington-based firms related to Cascade Investments through a "low-ball" aggressive representative, the two unknown Palm Beach sales are said to be still pending. If true, this may all add up to five more luxe rentals. Word that one of the town's casa magna spec houses might become a national museum for the real estate boom appears to be pure fiction. Sherle Wagner bath fixtures, c. 1990, may not be a tax deductible donation, just yet.

If you missed Twin Banyans, 241 El Vedado, one of Sue Whitmore's houses at $2.6 million in 1999, $6.1 million in 2005, or $8.2 million in 2008, it can be yours today with a Clive Christian gourmet kitchen for $8.99 million. Or, for $60,000, enjoy it a few months during the season. Also in the South End, Linda Gary's office has cut Cielito Lindo's asking to $8.9 million. A Palm Beach real estate agent in Sunday’s Shiny Sheet advertised a renovated house on Woodbridge Road with a $500K reduction, one of several local properties owned by NYC broker Abe Haruvi, promising “No reasonable offer will be refused!”
A view of the Intracoastal Waterway looking west. 1940 South Ocean Boulevard in Manalapan has ocean and waterway frontage separated by Ocean Blvd. that is not connected by a tunnel.
Nonetheless, Palm Beach’s summer of 2009 may go down in high-end real estate history not for sticker shock or shocking price cuts, however much $1 million+ adjustments are becoming the norm, but for its number of unlikely transactions. Several weeks ago two South End sellers of historic houses did an even $6 million trade, although their houses were once listed as high as $10-$12 million. Then, a week later, on the same day, one seller closed with two different buyers on two Wyeth-designed houses that were the subject of foreclosure proceedings. Now, the latest tango. For this one, take a minute to oil your abacus.

The most recent long shot involves two sellers — one, an LLC with a 1960 Neoclassical-style house in the Parc Monceau subdivision; the other, a Florida Land Trust, with a vacant ocean-to-waterway lot and a large mortgage in Manalapan — who bought each other’s property with simultaneous closings. Jackson Real Estate Partners LLC unloaded 115 Parc Monceau for $4.75 million to attorney Peter S. Broberg, as trustee for the Orchid Island Trust, according to the recorded deed. On the same day, Mr. Broberg, again as trustee for Orchid Island Trust, sold 1940 South Ocean Boulevard, Manalapan, for $5.475 million to Jackson Real Estate Partners LLC, of Sloan's Curve Drive, Palm Beach. Eva-Maria Gosten, sales associate at Brown Harris Stevens Palm Beach, represented Jackson Real Estate Partners; Lawrence Moens, of Lawrence A. Moens Associates, listed the Orchid Island Trust property.
115 Parc Monceau features an eclectic off-street facade turned to the west with a swimming pool along the south side elevation parallel to the street.
Both properties sold for $1 million less than their original asking prices. 115 Parc Monceau house asked $5.75 million before trimming down to $5.69 million. The sellers bought the five-bedroom house with deeded beach access in March 2008 for $3.43 million and renovated it. “We marketed the property for about six months,” said Gosten. According to Moens’ office, the 1.9 acre Manalapan lot south of Chillingworth Curve was first tagged at $6.95 million, then scalped to $5.95 million.

In 2005 Orchid Island Trust paid $5.995 million to William T. Gerrard, now the mayor of Manalapan who lives next door at 1960 South Ocean, for the parcel with 150 feet of ocean and waterway frontage. Lydian Bank placed a $4. 46 million mortgage with Orchid Island Trust, whose owner is believed to be interior designer Luis Lapitz, according to several Manalapan Town commission meeting minutes. At the time of the recent sale, it appears Lydian Bank shifted $3.45 million of Orchid Island’s original outstanding mortgage from the vacant Manalapan property to the approx. 5,000-sq.-ft. Parc Monceau house.
An entrance feature to the Parc Monceau subdivision in the 1700 block of South Ocean Boulevard. A statue atop Gertrude Maxwell's roof at Parc Monceau. On July 13 Mrs. Maxwell, the 98-year-old founder of Save-A-Pet, married Sol Hurwitz, 95, of Boston. Her third; his second. It must be something in the Palm Beach water.
According to various newspaper reports, in 1997 Mr. Lapitz sold his Nantucket summer house for $5 million to L. Dennis Kozlowski, the former Tyco chief executive who, convicted in 2005, is still serving 8-25 years in prison. Then, in 1998, Mr. Lapitz organized the Orchid Island Trust in Vero Beach. One of Mr. Lapitz’s Vero endeavors, 721 Grove Place, was offered for $13 million before being sold for $10 million in July 2005 to Ruth Wackenhut, widow of George Wackenhut, founder of the badge-uniform-and-gun security firm. The house was described as having two guest houses, three swimming pools, nine fireplaces and one-hundred stereo speakers.

Parc Monceau was developed by Ohio-native Clarence Mack (1888-1982) shortly after the success of his Regent Park subdivision. Named for the late 18th-century English-styled park in Paris, Parc Monceau was a South End estate-sized parcel subdivided into seven lots in 1960 built with spec houses formulated from the same rectilinear geometry and decor as Mack utilized for Regent Park. Arriving in Palm Beach during the 1930s, Mack followed the same design formula for his houses on Via del Lago, Jungle Road and El Vedado, calling it Tropical Empire, that he implemented previously on his 1920s Ohio houses, accessorizing facades with medallions, urns and statues.
500 Regent Park. c. 1958. Clarence Mack, builder.
At 319 El Vedado, he added pilasters and a lower-level garage to the facade of his popular Lakewood House, before selling it in 1940 to artist Channing Hare. The house was later owned by Mme. Jacques Balsan, before becoming the residence of Dame Celia Lipton Farris, who has lived at the El Vedado house for more than thirty years.

Mr. Mack claimed to be an architect, even on his death certificate, but he was a former department store window dresser who learned the building trade from his family in Shaker Heights and Lakewood, Ohio. Mr. Mack never formally studied, apprenticed, trained or was ever licensed as an architect in Florida or Ohio, according to the archivist of his collection of papers at the Cleveland Public Library.
The roofline of Clarence Mack's last-known house at 400 Regent Park. Sotheby's has the approx. 4,200-sq.-ft. lakefront house listed for $11.6 million.
Mack acted as his own designer and contractor, usually living in each of the houses before he sold them. Between 1914 and 1938, Mack design-built spec houses in Lakewood and Shaker Heights, Ohio, where he gave those with new fortunes old-moneyed mansions. He mixed-and-matched doorways, detailing and altering them with his own interpretative palette of French and Georgian features. Mack selected crystal chandeliers, planted English-style gardens, filled rooms with French and English antiques, and for the libraries, he leather-tooled the book spines to match the woodwork.

When builder Robert Gottfried (1926-2007) first arrived in Palm Beach, Gottfried said that Mack advised him to specialize and make one particular style his own. Gottfried adapted Mack's style, adding modern interiors designed for conveniences rather than antiques. Gottfried Regency, as TIME magazine called it in 1981, became one of Palm Beach's popular styles.
A Gottfried Regency design on Via Los Incas is distinguished by a marble balustrade along the parapet.

Former Merrill Lynch exec exits
With Casa Nana two doors south asking $72.5 million, 710 South Ocean's $17+ million price tag may seem like a real deal. In April 2007, a small vacant parcel several blocks north at 101 El Bravo was sold for $16.5 million that now features a $42+ million spec house under construction.
Lien times

During the past several weeks various lenders have extended approx. $65 million in mortgages to Palm Beach residents on their island properties. Several substantial recent sales appear to have been sold for the existing loan value plus closing costs.

Former Merrill Lynch executive Richard W. Fuscone, and his wife, Marjorie Fuscone, of Greenwich, Conn., sold 2 Via Los Incas for $4.6 million to Robert J. and Lenore Snyder of Chevy Chase, Maryland, following a foreclosure action by Northern Trust Bank. The Fuscones bought the 5,000-sq.-ft Gottfried-built house in 2003 for $4.85 million, selling their 101 Nightingale Trail property to Marvin Davidson for $6.875 million. In 2007 Northern Trust Bank had increased the Fuscones' debt to $5.6 million. Last month, Northern Trust filed a judgment against the Fuscones scheduling a court-ordered auction for August 6. On July 24, the court cancelled the foreclosure auction. The Snyders are the fifth owner of the Los Incas house since 1999.
Last week a local front-page story alleged banks are curbing short sales, selling a property for less than the existing mortgage, by engaging in holdbacks. A holdback refers to a foreclosure process that is intentionally slowed by the lender in order to obtain a higher price for the property, hoping it will cover the loan value. In many instances, these are loan values that now exceed the market value of the property.

“What you have in Palm Beach are a pile of paper transactions,” said a veteran island real estate broker. A bank spokesman denied allegations that banks engage in holdbacks, stating turnarounds have slowed because of the overwhelming volume of foreclosures.

Other market watchers believe banks are intentionally controlling and skewing market prices by attempting to cover their mortgages and safety net the market from a real market bottom. With banks currently holding mega-mortgages on several of Palm Beach's trophy properties ranging from $15 to $50 million, it should prove interesting whether buyers will continue paying sales prices set by banks.

Grace estate sells Lost Tree fairway house

The estate of the late Janet Maureen Grace, sister of J. Peter Grace, sold Mrs. Grace’s 11941 Turtle Beach Road house located on the golf course in Lost Tree Village for $1.225 million to attorney Robert M. Williams. In June, Mr. Williams sold his 1304 Lake Worth Lane waterfront house for $6.5 million to his law partner, Lake Lytal, Jr. The Lost Tree property was purchased for Mrs. Grace in 1996 for $450,000 after she sold her North Lake Way house in Palm Beach. Mrs. Grace passed away in 2006.

North End in-and-out
A Rhode Island resident, Laura Love Rose, sold 135 Reef Rd. for $1.795 million, having bought it in 2004 for $1.65 million. Donald and Maureen Kandziora, of Lake Forest, Ill., are the fourth owners since 2003.
Correction: A shot in the dark (or several shots …)

An astute NYSD reader called my attention to an error in fact found in my previous column. In retelling the misfortunes that struck the owners of Dunnellen Hall, in particular, Gregg Dodge Moran and Daniel Moran, I inadvertently ran two sentences together and mistakenly wrote that Mr. Moran may have shot someone while they still owned their Greenwich mansion. Actually, according to contemporaneous newspaper reports, the 1968 shooting incident took place at the Morans’ Palm Beach house at 1089 South Ocean Blvd. They sold the Greenwich house and then bought the Palm Beach oceanfront in July of the same year. As the story was told, Mr. Moran was upstairs bedridden with a bad back when he shot an alleged intruder twice, who both Morans said attempted to climb in their bedroom window on construction scaffolding that surrounded their house while undergoing renovation. The alleged intruder, a busboy, bled to death; the Morans were exonerated of any criminal charges. A decade later, soon after the couple filed bankruptcy, Mr. Moran committed suicide with one shot to the chest in an upstairs bedroom at the same Palm Beach house.

Palm Beach Modern

An ongoing look at some of Palm Beach’s lesser appreciated mid-century architectural highlights, at least until the real estate market revives.
The Palmbeacher apartments, 3030 South Ocean Boulevard. Port cochere, c. 1955.
389 South Lake Drive, port cochere entrance. c. 1960. Howard Chilton, architect.
389 South Lake Drive, promotional brochure. 1960.
The Riviera, 455 Worth Avenue, c. 1950. John Stetson, architect. Entrance facing south on Worth Avenue.
The Riviera, 455 Worth Avenue. A north elevation view from Peruvian Avenue.
The President of Palm Beach, 2505 South Ocean Boulevard. Port cochere entrance, c. 1965.
The Southlake, 315 South Lake Drive. c. 1960. Promotional sketch, 1960; photo, 2009. Howard Chilton, architect.
760 Island Drive, Everglades Island, The Mass House, Alfred Browning Parker, architect. Built for the developer of the Palm Beach Towers during the mid-1950s and demolished in the 1970-80s, I recently found this photo of an elevation I had never seen.
760 Island Drive, the southeast point of Everglades Island. A quintessential Tropical Modern house. Architect Alfred Browning Parker called it his "30-60-90 house."
The Brazilian of Palm Beach, 227 Brazilian Avenue.
North Lake Way lakefront lot sold for $3.675 million

Four years after 1480 North Lake Way was first listed for more than $17 million as the estate of convicted murderer Fred Keller with 285 feet of waterfront, a 10,000-sq.-ft. house, guest house and pool, the subdivided half-acre vacant southerly lot with 105 feet of waterfront has sold for $3.675 million, leaving the larger remaining parcel still on the market. According to the warranty deed filed July 28, attorneys Daniel J. Shepherd and John Farina, as successor land co-trustees of Florida Land Trust No. 1026, conveyed title to St. George Investments LLC, a Louisiana LLC based in New Orleans.

The property's provenance may have given buyers a sense of hesitation. As widely-reported, two years ago Fred Keller died in prison after being convicted of murdering his fifth ex-wife, Rose, with whom he had shared the North Lake Way house. After the property failed to sell for $17 million, another broker listed the house for $12 million and the smaller vacant lot was tagged at $7 million. Eventually, the main house and guest house were demolished. Then, the asking price for the larger parcel dropped to $10 million. In 2008 the smaller vacant lot was assessed at $6.15 million by the county property appraiser's office. The property has a sandy beach rather than a seawall. Most recently, Lawrence Moens, of Lawrence A. Moens Associates, had listed the lot at $4.2 million.
North Lake Way lakefront lot sold for $3.675 million.
"At $35,000 a lineal lakefront foot, it may be a record low," said broker Marianne Chopp who, along with Dirk Patriarca, sales associate, both with Bonsai Private Property Brokers of Palm Beach, represented the buyer. Ironically, Ms. Chopp was the listing agent for the property several years ago and said that her buyer plans to build on the property.

A North Lake Way vacant waterfront lot sold for $3.675 million.

Palm Beach etiquette class
Pan's Garden in Midtown. An instructive sign posted along the wall.

Midtown beach at Worth Avenue, Palm Beach. Sunday, 26 July, 7:00 a.m.
Photographs by Augustus Mayhew.

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