In many markets, if you want to buy a repossessed property, you better come with your best offer first — and fast.
That may be true for homes in the lower price brackets, but rarely for homes in the upper price brackets.
The article got me to wondering what the most expensive foreclosure property currently was in the Phoenix area and I came up with this- 6629 E. Meadowlark Lane, Paradise Valley. [MLS #4183460] It is currently listed for $4.25 million, but was listed for $6.5 million. [It is actually tied for first place.]
The house, which was built for $3.85M in 2002, was described as one of America’s finest homes in a 2005 issue of Frontgate:
PARADISE VALLEY, ARIZONA — Daron and Ron Barness had no intention of moving, let alone leaving Scottsdale — until the day Daron happened to drive past a charming new French-Italian villa in Paradise Valley. "When you stumble across something so beautiful . . . well, we just decided to make it work."
Though the location ultimately proved disappointing, she and Ron got in on the ground floor of a similar house nearby. "Since the house was still in the framing stage, we had more choices right from the start. Once we got our fingers on all the decisions, it really became ours."
Yet there were so many decisions to make: flooring, tile, countertops, paint colors, furnishings . . . ! Overwhelmed by the enormity of the project, Daron and Ron enlisted the services of designer David Michael Miller. "I didn’t want to make any mistakes and find myself wanting to change this or that a year later."
It sounds like the owners spared no expense:
Together, Daron and Miller visited quarries to select stone and took buying trips to Los Angeles and San Francisco in search of furniture. "We’d go into sales rooms and sit on something, and he’d say, ‘How does that feel? Where does it hit your back?’ Ron and I didn’t want anything that wasn’t easy to live with. And we wanted to sit as comfortably in the living room as any other room in the house."
A loan was taken out by the owners in 2005 for $7.5M, and this property and a lot in Desert Mountain were put up as collateral. In April of this year the Barness’ did a "Deed in Lieu" for $7M and gave both properties back to the lender.
The Barnesses, who are in commercial and retail real estate development, ‘ have had financial problems that have apparently forced them to cut back on their charitable donations. They suspended their family foundation in December of 2008:
A spokesman for The Daron and Ron Barness Family Foundation in Scottsdale said it is temporarily ceasing operations at the end of the month, a casualty of the recession.
"Ron Barness is in the commercial real estate business, and we’ve been feeling the pinch for a while," said the foundation’s executive director, Frank Jacobson, who also said that since its 2005 inception the foundation has granted several million dollars to scores of nonprofit organizations in the Valley.
In the past three years, about 200 nonprofit organizations have applied for foundation grants.
The Barness’ are also active in politics. They raised $500,000 for Senator John McCain and contributed large amounts themselves. Over $60,000 in 2006 and over $40,000 in 2008.
It looks like the Barness’ financial problems aren’t over:
Scottsdale real estate developers and shopping center owners Ron Barness and Alex Papakyriakou are facing three lawsuits related to almost $9.5 million in loans from an Oklahoma bank to the pair’s real estate partnerships. The two men also are defendants in three investor lawsuits claiming they mismanaged investments in their retail real estate endeavors.
The developers are trying to settle the investor complaints, according to several attorneys familiar with the cases. In 2008, the pair settled a similar investor suit out of court.
Barness and Papakyriakou, principals of Scottsdale-based
Retail Brokers Inc., own shopping centers in Phoenix ,Tempe , Gilbert andGlendale . They operate each center under a separate business partnership.
[Many thanks to L for his help with this. If there are any errors, they are my own.]
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a pretty good sign of the commercial bubble bursting. but i bet we’ll end up seein people like these get a bit more help than those currently receiving help who are residential owners. the difference…..commercial real estate “investors” (which is just a nicer sounding word than “speculators”)are the ones who could afford to finance politicians. it is a shame though, if their not for profit was legitimate, that it had to suffer.
AZSaluki-
There are generous souls in the real estate industry, and some of them have contributed significantly to charities. One of the saddest part of the downturn is that at a time when the demand for services of charities is increasing, donations are falling as people can no longer afford to contribute.
Huh.
Well, that helps narrow it down. If you want to buy a congressman to bail yourself out, it apparently costs more than $500,000.
Beautiful looking house though..