The Los Angeles Almanac says that LA’s richest resident is Elon Musk, a guy who makes do with a net worth of $22 billion or so. While true — Yolanda does not doubt he is our richest full-time resident — there are an assortment of other folks even richer than ol’ Musky who own part-time vacation homes here. Take Jeff Bezos, the world’s richest human. He’s got a two-house compound in Beverly Hills. Larry Ellison has 235,000 houses in Malibu. And Sheldon Adelson also has a baker’s dozen Malibu homes (or so).
Not that any of this really matters. At some point, the gap in wealth between billionaires becomes purely academic. What’s the difference between a guy worth $22 billion and a guy worth $92 billion, other than rank on the Forbes list? Neither of them could ever spend all that in a lifetime.
But anyway, there’s another unfathomably rich person who also owns residential property in LA, although we don’t think it has been reported until now. He is a Frenchman named Bernard Arnault, and Forbes claims he’s worth more than $70 billion. That’s enough moolah to make him the 4th-richest man on Earth, behind only our Mr. Bezos, Bill Gates, and Warren Buffet.
Some of y’all may know that Mr. Arnault has long been head honcho at LVMH, by far the world’s biggest luxury goods conglomerate. LVMH owns Louis Vuitton, Sephora, Dior, Givenchy, Fendi, Bulgari, Hublot, Rimowa, Veuve Cliquot, and dozens of other high-end brands. LVMH is now so massive — the group’s total revenue topped $48 billion USD last year — that Mr. Arnault has a virtual monopoly on the worldwide luxury goods market, save for his arch-rivals at Kering.
But Mr. Arnault isn’t just LVMH’s Chairman and CEO. The 69-year-old essentially built the colossal conglomerate singlehandedly, and the Arnault family owns nearly half of the publicly-traded business.
Speaking of family, Mr. Arnault has been married twice and has five adult children, four sons and one daughter. All of his kids have executive roles at LVMH — or roles at one or more of the brands under the LVMH umbrella. Mr. Arnault and his current lady-love — French-Canadian concert pianist Hélène Mercier have been hitched since 1991.
In his spare time, Mr. Arnault reportedly enjoys collecting art — he’s already got a world-class collection, as y’all might expect — and sailing on his $150 million Symphony superyacht. But oh dear, we’re rambling on a bit now. If you’d like to read more about Mr. Arnault, might we suggest the Financial Times‘ fascinating in-depth profile, which includes an interview with the big man himself.
Onto the subject at hand. Over the last two years, Mr. Arnault has quietly acquired five very prime residential properties in and around Beverly Hills. And he paid top dollar for all five parcels — by our calculations, his expenditures total more than $125 million so far. And that’s just the land, kids.
Normally transactions of that size would get sniffed out by someone, but we think the reason Mr. Arnault’s acquisitions flew under the radar for so long is because all five of the homes were never publicly listed for sale, and all five were purchased via oddly-named LLCs that mask the owner’s true identity.
Before we take a property peek, y’all should know that it’s not particularly surprising that Mr. Arnault would be in the mood to acquire Los Angeles real estate. Though he mainly resides in France, Mr. Arnault (and LVMH) already own about half of Rodeo Drive. (He/they paid a whopping $110 million earlier this year for yet another storefront there, and he’s rumored to be in escrow on a $250 million double-lot). And don’t forget that Mr. Arnault made his first fortune in real estate — long, long before LVMH came to be.
Mr. Arnault’s first residential acquisition closed in September 2016, when he paid $32,500,000 (in cash, naturally) for a house located on what is oft-considered the best street in Trousdale Estates.
The large home — which was sold by a non-famous Iranian family — was a rather pedestrian mid-century modern thing. We say “was” because Mr. Arnault almost immediately demolished the structure and is now midway through construction on something new. Something quite massive, too, but the details are murky. More on that in a sec.
Just last month (October 2018), Mr. Arnault paid exactly $30 million for the house next door, a rather bulky mid-century modern sold by another non-famous Iranian family. The house has more than 6,400-square-feet of living space, a large motorcourt and a pool, but we doubt any of that interests Mr. Arnault. Y’all can be certain that all those luxury features will soon be headed for the local landfill.
We believe that Mr. Arnault is planning one gigantic compound to cover both lots, which combined total 2.84 acres of uber-prime real estate (though about half that land is unusable hillside). Although you can’t see it from your computer/phone screens, both lots are blessed with jetliner views of the LA skyline, the sort of thing from which Southern California real estate dreams are made.
Yolanda pored over dozens of permits and while we are still unclear about what exactly Mr. Arnault is plotting up in Trousdale, it appears that several well-known local firms — Vantage Design Group, Crest Real Estate, Shawmut Design & Construction — are involved with the project.
But wait, there’s more. In November 2017, Mr. Arnault forked out $16,950,000 for a house high in the nearby so-called Bird Streets of the Hollywood Hills. Scarcely two months later, he paid another $14,500,000 for the smaller home next door. Both houses are located on the so-called “Front row” of the neighborhood, a hillside with spectacular views of the LA basin.
Anyway, both houses were soon razed and Mr. Arnault is currently in the early stages of building something — again, we’re not sure what — on the 0.83-acres of dirt. But if it’s a big spec-mansion being planned, the timing is curious. Sales in the Birds are quite sluggish these days. Maybe Mr. Arnault knows something to which we ain’t privy?
The final piece of Mr. Arnault’s property puzzle (so far, at least) is arguably the most impressive of all. Back in June 2017, our boy paid a wild $33,900,000 for a 3.64-acre estate high in the mountains above Beverly Hills, in an area known as Beverly Hills Post Office (BHPO). It is our understanding that the property was essentially vacant at the time of his acquisition and he is now in the very early stages of building something — but again, we haven’t the foggiest idea what that something is.
Just to give you an idea of how anti-cheap Mr. Arnault is, the seller of the BHPO property — handbag entrepreneur turned real estate developer Bruce Makowsky — paid “just” $18.4 million for the property less than three years before selling it to Mr. Arnault. That means Mr. Makowsky raked in a profit of over $15 million! Minus realtor fees, permit expenses, any improvements and other ancillary costs, of course.
Anywho. Yolanda’s guess (and remember, it’s just a guess) is that these three new compounds are not intended to be family homes for the Arnaults. Rather, they will be spec-mansions of the highest order and will eventually be listed for sale with absurd nine-figure pricetags. Such happenings are quickly becoming the new normal in LA.
But if that is Mr. Arnault’s intention, we worry about his likelihood of success. How many folks with $100+ million to spend on a house are looking to buy in LA? We’ve got plenty of billionaires, sure. But even most billionaires don’t care to break real estate records with showy giga-mansions. And in Trousdale alone, Mr. Arnault has already spent $62.5 million on dirt. Once the new pad is complete, he’ll probably be into the project for close to $100 million.
Not likely that a profit can be turned from that. But we suppose if anyone can do it, it’s Mr. Arnault.