Palm Beach’s social orbit, the seasonal centrifuge of galas, gowns and guest lists, is in full spin just as the island’s real estate juggernaut may be showing signs of a slowdown, possibly triggering a greater threat to the Palm Beach whirlwind than if the whiteflies decimate the resort’s signature ficus hedges.
Although the town’s commercial areas are zoned for fashion, financials and fundraising events, Palm Beach’s actual billion dollar industry is produced on its residential streets where more than one thousand real estate brokers and the nation’s most energetic house speculators have converged, joined by building contractors, architects and interior designers, competing to sell, demolish, construct, rebuild, renovate, restore, recycle and package the island’s most valuable resource, its real estate.
During the past 25 years of Palm Beach’s make-every-house-a-mansion movement, when more people bought Palm Beach houses to sell rather than to live in, more than 500 single-family houses have been knocked down, replaced most often with over-sized spec houses more suitable as Wellington McMansions than squeezed onto the town’s more intimate subdivisions.
On Everglades Island, (does it just look like Island Drive is sinking from the weight of the new colossal houses?) there are currently ten construction sites. For one North End house, the pursuit of perfection has been non-stop, having seven different owners in the past eight years.
In today’s Palm Beach residents are as likely to have a corporation living next door as individuals or a family. In some of the town’s residential subdivisions more than 20% of the houses are now owned by corporations or LLCs while some houses are completely surrounded by corporate construction sites.
Since Maison d’Amitie sold for $95 million in July, the North County Road oceanfront estate that Donald Trump sold to County Road Property LLC, believed to represent Russian fertilizer titan, Dmitry Ryboloviev, mortgages have been the largest transactions among the town’s billionaires. Palm Beach real estate may be like nowhere else on Earth but when really rich residents want to raise cash they tap their home equity, recently adding more than $118 million in mortgages for three South End properties while other more modest credit lines within the $5-15 million range have also been recorded.
John L and Margaret B. Thornton, who bought 1236 South Ocean Blvd and 200 Emerald Beach Way in April, have locked in a $35 million 5.8% ARM mortgage from New Jersey-based PHH Mortgage Services, according to court documents. At the same time the Thorntons purchased Sidney and Caroline Kimmel’s oceanfront estate for $81.5 million, they also snapped up 200 Emerald Beach Way, an adjacent parcel. The PHH loan is secured by both properties.
A few doors south of the Thorntons, noted housing mogul, Dwight C. Schar, is believed to be the holder of the largest residential mortgage in Palm Beach history.
Mr. Schar, as a principal of the 1300 South Ocean Blvd. Revocable Trust, received a mortgage from JPMorgan Chase Bank in Houston, providing a credit line not to exceed $63 million, $51 million on Casa Apava, his Palm Beach residence, and $12 million on his Chain Bridge Rd. house in McLean, Va., as stated in recent court papers.
Chairman of NVR Inc., a Washington-area based homebuilding conglomerate operating in 18 cities in 11 states, Schar purchased the historic ocean-to-lake estate in 2004 for reportedly more than $90 million from Ron Perelman.
Lodged in between the Thorntons and the Schars, Emma Cisneros, as president of White Sea Holdings LLC, has secured a $20 million mortgage for 60 Blossom Way, recently purchased for $65 million from George and Frayda Lindemann. Along with Cisneros, Venezuelan banker and polo patron, Victor Vargas, is also a named director of White Sea Holdings LLC. In 2005 Mr. Vargas purchased 1960 South Ocean Blvd for $33.6 million in 30 seconds, according to a July 2008 Architectural Digest article where Mrs. Vargas was referred to as “Dona X.”
Meanwhile, the Shiny Sheet’s pages are packed with available condos and cottages. At the top, Realtors Linda Gary and Jim McCann are hoping to sell 780 South Ocean, known as Casa Nana, for $72.5 million. The current owner, auto dealer Terry Taylor, has already purchased an enormous Manalapan ocean-to-lake spec in Manalapan for $22 million with the sellers holding paper and has already placed that house on the market, again. When McCann and Gary sell Casa Nana, it will be historic Mizner-designed house’s seventh owner since Woolworth Donahue’s widow, Mary Hartline Donahue, sold it for $3 million in 1980.
In addition to the latest 25,000 sq. ft. French chateau available for the next Caspian czar wanting to jet between County Road and the Cote d’Azur, the most interesting listing, at the moment, may not be one of Palm Beach proper’s recycled mansions, but the first-time-on-the-market William S. Farish house in Gulf Stream, a fifteen-minute drive south of Sloan’s Curve along Ocean Boulevard.
Ever since Gulf Stream’s famous polo fields were transformed into a subdivision during the 1960s, this town-without-a-stoplight has been best known for being outside the glare of Palm Beach’s social center ring, its residents preferring their own private club logos rather those for Hermes and Bottega Veneta. Thus, some Gulf Streamers may have gasped when the September issue of Vanity Fair featured designer Tomas Maier’s oceanfront house, located on the north side of the Gulf Stream Golf Club, that was purchased by Maier, and his partner, Andrew Preston, for $7.3 million in 2006.
Yet, the recent For Sale sign in front of Will and Sarah Farish’s secluded Gulf Stream oceanfront estate, currently listed by Corcoran Group associates Randy Ely and Nicholas Malinosky at $13.95 million, has its own undeniable distinction, even in a town that remains a low-profile high-hedge sanctuary for some of America’s wealthiest families.
During the late 1980s the Farishes bought the Gulf Stream parcel with 180 ft. of ocean frontage where they built a four-bedroom Bermuda-style main house and two-bedroom guest house, amassing 8,000 sq. ft. of living space. With direct ocean views from the master bedroom, living room, dining room and den, the tropically-landscaped nearly two-acre estate features a large gourmet eat-in kitchen, loggia, pool and patio for outdoor entertaining. The guest house, where President Bush “41” stayed, includes two bedrooms, a living room and kitchen.
The Farish house may not be the largest property currently on the Palm Beach market but if provenance can be measured then their teardown asking price may be the area’s most undervalued listing.
And considering that Will and Sara Farish’s son, Bill, and his wife, Kelley (Ogden “Dinny” Phipps’ step-daughter), recently sold one of their Wellington houses for $4.6 million to entertainer Bruce Springsteen, the elder Farish’s the-president-slept-here oceanfront house is no less a star attraction.
Appointed US Ambassador to the Court of St. James by close friend and President George H. W. Bush, Farish is among the world’s leading thoroughbred horse owners and breeders and heads up W. S. Farish & Co., a Houston-based investment company.
A former chairman of Churchill Downs, Mr. Farish is the grandson of a Humble Oil founder and Standard Oil president; his wife, Sarah, is the daughter of the late Bayard Sharp, a great-grandson of E. I. DuPont, who in 1964, acquired the Gasparilla Inn & Club in Boca Grande, one of Florida’s most historic and exclusive venues, that is now owned by both Farishes.
At the faily’s 2000-acre bluegrass Lane’s End Farm in Versailles, Kentucky, and 300-acre facility near Houston, Texas, the Farishes oversee their thoroughbred breeding complexes, having produced more than 245 stakes and Triple-Crown winners, as well as hosting Queen Elizabeth II at Pleasant Lawn, the family’s house built in 1829 at the farm.
The Palm Beach season is on, everyone is down and the For Sale signs are up. And, after all, just think, a $63 million mortgage.