$100 Million Buys More Than You Think
FOR $100 million, the buyers of Casa Casuarina, the mansion that once belonged to the fashion icon Gianni Versace, will get a 23,000-square-foot spread in Miami Beach with a 54-foot-long pool lined with mosaic tiles and 24-karat gold. They will acquire millions of dollars’ worth of Italian furniture — one room’s windows alone are framed by $250,000 in silk-and-velvet drapes, the current owner said.
The mansion also comes with a boutique hotel with 10 suites, British-trained butlers and a restaurant that serves cocktails in Versace martini glasses.
That hotel will come in handy, because whoever buys Casa Casuarina may need at least half those rooms for lawyers.
The mansion — Mr. Versace was gunned down at its entrance gate in 1997 — is embroiled in a particularly complicated legal battle, taking some of the shine off this trophy home for any prospective buyers.
The mortgage on the property is in default, and the owners of the debt, an entity affiliated with the Nakash family of New York, are battling in Miami courts to foreclose on the mansion.
The Nakashes, owners of Jordache Enterprises, the jeans company, are outraged at the high listing price for Casa Casuarina. The mansion’s current owner, telecom mogul Peter T. Loftin, put the residence on the market for $125 million in June and lowered it to $100 million in November.
The Nakashes want the court case to play out expeditiously so they can take the property over in foreclosure, said Jonathan Bennett, who manages the family’s multibillion-dollar real estate holdings, which include three hotels in Miami Beach, all on Ocean Drive.
“The Versace mansion has been listed for an outrageously inflated price,” the family said in a statement, “for the main purpose of trying to gain some tactical advantage in ongoing litigation.”
Mr. Loftin denied that he was trying to stall the legal case in order to sell the property on the open market for more.
“Absolutely not,” he said. “It is a good time for me to sell it. Properties are selling now for large amounts.”
For some New Yorkers, a $100 million price tag may not induce sticker shock . But in Miami, Casa Casuarina’s list price is more than twice the highest recorded sale — of a 10-bedroom home on Indian Creek that sold for $47 million last year.
The only other property in Florida to draw such a lofty asking price was a Palm Beach home that Donald Trump sold for $100 million in 2008 to a trust linked to Dmitry Rybolovlev, a Russian billionaire.
VM South Beach, the entity affiliated with Jordache, filed a federal foreclosure lawsuit in December 2011 against Casa Casuarina and Mr. Loftin for failure to pay a $25 million mortgage bought by the Nakash family for $15 million from WestLB, a German bank.
Mr. Loftin said he had stopped paying his mortgage after 2010 when he realized the loan documents at closing did not reflect his final agreement with WestLB. He has alleged a conspiracy involving the Nakashes and the German bank.
“They bought a fraudulent note,” he said of the Nakashes. “They knew it was fraudulent.”
Mr. Bennett, the Jordache representative, called the allegations “completely ridiculous,” noting that Mr. Loftin “signed the documents.”
Taxes, too, were not paid for three years, and Mr. Loftin is in a dispute with his tenant, the hotelier Barton G. Weiss, over who is responsible for the payment. (Mr. Weiss, who was out of the country this week, did not respond to e-mailed questions sent through an assistant.)
Since the Nakashes filed their foreclosure action on the property in late 2011 there have been many court filings but little real action in the case. The two sides are currently battling over jurisdiction. To further complicate things, a bankruptcy trustee also has a claim on the property, because Scott Rothstein, a Miami lawyer now in prison for masterminding a $1.2 billion Ponzi scheme, held a minority interest in it.
Mr. Loftin dismissed the idea that this messy court battle might affect his ability to sell. He said he had received “very serious inquiries and verbal offers most would accept” for the mansion, but was taking his time to try to sell to the “right buyer to reimburse all owners that are entitled to reimbursement.”
Assessments of the property’s value vary widely. Nakash lawyers claimed to the court that the estimated market value was $15 million.
While Mr. Versace’s taste for Venetian-style architecture and furnishings may not be for everybody, Casa Casuarina is a rare mansion on Ocean Drive with a special history.
He bought it in 1992 for $2.95 million, and then sank an estimated $33 million into it. He lived there until the day he was killed by Andrew Cunanan upon returning from a morning walk along Ocean Drive.
In 2000, Mr. Loftin bought the mansion from the grieving Versace family for $19 million in cash, believed then to be the highest sales price ever in Miami-Dade County. He later got a mortgage, and he has said he put in $20 million in renovations, including $10 million in Italian furniture bought mostly in Venice.
Mr. Loftin, who lived in the mansion for four years before moving elsewhere in Miami Beach, said he had entertained billionaires and celebrities at Casa Casuarina when he operated the property as a members-only club.
When Mr. Loftin reduced the asking price in November, the decrease was promoted with a slickly produced video featuring its well-known brokers, Jill Eber and Jill Hertzberg of Coldwell Banker, known as the Jills.
“Anybody who buys this, it is instant celebrity — if they want it,” Ms. Eber said, standing in front of a pool.
But even if the new owner was willing to pay a premium to acquire the mansion free of legal encumbrances — which one lawyer estimated could cost around $40 million — its current tenant, Mr. Weiss, would have to be persuaded to leave. He operates the boutique hotel, the Villa by Barton G., on the property, which rents one-bedroom suites with “custom” king-size beds for $2,250 a night.
Mr. Weiss has a lease stretching to 2020, with an option to renew for 10 more after that.
“There are always ways to get out of leases,” Mr. Loftin said. He suggested the buyer share the mansion with Barton G. and “take the whole top floor for himself.”
The Nakashes don’t exactly see that kind of arrangement justifying a $100 million price tag.
“Why would somebody who wants to use it as a home buy a property he can’t live in?” Mr. Bennett asked. “There is a lot of hairy stuff on this property.”