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Apr30

Pulling a Zuckerberg: Why Tech Titans Are Buying Neighbors’ Homes

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As Mark Zuckerberg’s social networking company, Facebook, celebrates its 10th anniversary tomorrow and has worldwide usage by 1.23 billion people, the tech titan finds himself at the forefront of a real estate trend: tech bosses who are buying up their neighbors’ properties.

Zuckerberg made headlines last fall when he reportedly spent $30 million to purchase four of his neighbors’ homes. Not only were the homes not on the market, but Facebook’s chairman and chief executive officer turned around and leased them back to their original owners. Two weeks later, Yahoo CEO Marissa Mayer reportedly bought a funeral home near her residence, with the Daily Mail proclaiming, “Yahoo! Marissa Mayer does a Zuckerberg and starts to buy up her neighborhood.” Three days later, the Silicon Valley Business Journal announced “Elon Musk pulls a Zuckerberg,” when news surfaced that the inventor and Tesla Motors CEO had purchased a home across the street from his Bel-Air pad. While this tech titan home-buying spree was newsworthy in its own right, buying up neighbors’ homes is not a new phenomenon. FromBrad Pitt to Reese Witherspoon, celebs long have been known for making multiple real estate moves in their neighborhoods. The question is whether tech titans have the same motives as Hollywood stars or if this new breed of celebrity is rewriting the high-end real estate playbook. To find out, we asked The Agency’s Kofi Natei Nartey, who helps celebrities and athletes buy and sell homes on HGTV’s “Selling LA,” and Silicon Valley real estate agents of the Boyenga Team to share their insight.

Privacy is paramount

According to Nartey, it’s common for Hollywood stars to purchase neighbors’ homes as a way of protecting their privacy. “It’s a way to control who is your neighbor,” Nartey explained. “In the Hills, there are homes with amazing views, but with that comes limited privacy.” Eric Boyenga says it’s the same for high-profile tech execs, who are increasingly becoming household names. “It’s not uncommon for entrepreneurs to purchase neighbors’ property,” he said. “In the social era of today, those like Zuckerberg tend to be a mix of Hollywood star and tech titan, whereas a lot of execs in the past didn’t get a lot of fanfare.”

A normal quality of life

But unlike A-list celebs who are accustomed to dodging paparazzi, Boyenga says tech bosses are often in search of a more “normal” quality of life. “We’re more engineer-driven here. Execs don’t want any news about them,” he said. “For a celebrity, that’s par for their course, but for a tech entrepreneur, they want the focus on their firm and [to have] a life outside of that.” Younger tech company execs — including 29-year-old Zuckerberg — are drawn to the vibrant culture in Palo Alto. “We have hills like the Hollywood Hills here that are more private, gated estates with views,” Boyenga said. “But, Palo Alto is where things are happening. It’s a very idyllic neighborhood and a great place to raise a family.” He says most people who move to Palo Alto want to keep the neighborhood the way it is, and tech entrepreneurs are no exception. For instance, when Zuckerberg began buying additional homes in his neighborhood in December 2012, it was because he reportedly learned of a developer’s plans to capitalize on his residence in the area. “These are tech titans that want to be part of their community but also want to make sure they don’t have someone move in next door that they don’t want there,” he explained. “It’s not a control thing as much as about quality of life.” No way to buy bigger Because Silicon Valley entrepreneurs are drawn to historic neighborhoods such as Old Palo Alto and Crescent Park, they’re subject to a competitive market. “Inventory is so hard to come by,” said real estate agent Janelle Boyenga, Eric’s wife. “What we’ve seen is people are buying properties and keeping them to pass on to generations to come. Inventory is only going to get tighter as the years go by.” And, unlike celebs who buy sprawling Beverly Glen estates or Manhattan penthouses spanning multiple floors, execs living in the Valley don’t always have the choice to buy a bigger home. “In Old Palo Alto, there are not many large lots. Most are less than a quarter of an acre,” Eric Boyenga said. “Only a handful are half an acre, and they just don’t get sold off.” Making room for friends & family But when tech titans buy neighboring properties, it instantly raises questions about what they’re going to do with the lot and how it will impact the neighborhood. “Marissa Mayer [buying the funeral home] — I’m curious about that one,” Boyenga said. “It could just sit there for years to keep a big development from coming near her property.” He’s skeptical that Mayer can drastically change the property, even if she wants to, because of building restrictions. For this reason, Boyenga says most people tend to use neighboring property as a place to have friends come and visit. “It’s not easy to buy a parcel and take the house down,” he said. “Most of these people are looking to use for guesthouse purposes or just for privacy.” Rumors about high-profile real estate purchases are common — fashion mogul Kimora Lee Simmons’ reported 2009 purchase of her neighbor’s tennis court to build a pool is a good example. Nartey points out that often rumors are just because, frankly, it’s very difficult to drastically change a residence in L.A. “You have to get permits from the city for any remodel or new construction — anything that might undermine the aesthetics of the neighborhood,” he said. At the end of the day, whether celebrity or tech titan, it’s about finding a place to call home. “More than anything else these buyers are buying for privacy and quality of life,” Boyenga said.

Apr30

10 Best Practices When Working With Celebrity Clients

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As the director of the Sports & Entertainment Division at The Agency, I have the pleasure of working with celebrities from the world of TV, film, music and professional sports. It’s an extremely rewarding yet challenging niche, as celebrities have very unique real estate needs and concerns when it comes to such things as privacy, location and amenities. While there are numerous things to know about working with the A-list set — indeed it’s an ongoing learning process that’s impossible to master overnight — here are 10 quick “best practices” to consider when working with celebrity real estate clients.

Be an expert

This is No.1 on the list for a reason. Celebrities want to know they are working with an expert. You should know your market and your industry but also know about regulations that may be relevant to the celebrity’s lifestyle. How high can the privacy walls or hedges be? Can they put a gate around the property? Are there building restrictions for the area?  Also, be sure to understand contracts and negotiations.

Be discreet

Keep your client’s name and personal information confidential. You will have access to a part of your client’s personal business, and people will even ask you what it’s like to work with them. Keep it to yourself. Don’t brag or boast about who you are working with.

Be professional

Be on time. Be responsive. Be proactive. The bottom line: Be a professional, not a fan. I have been invited to numerous concerts, games and events of my celebrity clients, but only because I’ve never asked.

Be flexible

Celebrities’ schedules change faster than the weather. Be ready for last-minute showings, cancellations, rescheduling and explaining to other agents why your client is running “a few minutes behind.” Being flexible will make it a more enjoyable experience for you and your client.

Identify all of the decision makers

Whether it’s a business manager, agent, friend or relative, find out who will be influencing the celebrity’s decision to buy or sell. It might even be a pet. (Candy Spelling had her dog Madison help her pick her real estate agent.) Work closely and professionally with these key contacts. Treat them like the celebrity.

Have a reliable network of vendor referrals

You may be called on to refer anything from an interior designer to a company that installs tennis courts. Have trusted, professional vendors with a track record of working with high-profile clientele in your rolodex (by rolodex, I mean iPhone).

Be mindful of their time

Celebrities are busy people and don’t have time to waste. Preview properties whenever possible. Don’t waste time on properties that don’t fit their criteria. Again, be on time. They can be late, but you can’t.

When selling a celebrity home

There are numerous things to consider, but here are a few key points. Decide up front whether or not to disclose the celebrity status of the property. If it is inevitable that the owner’s identity will come out, it can be better to embrace it. Also, keep lookie-loos out of the property. Celebrity homes can attract unwanted prospects who just want a peek into the celebrity’s life. Screen all prospects (even those with agents). Unfortunately, we cannot always rely on the other agents to verify that their client is qualified and serious.

When working with a celebrity buyer

Respect their budget. Listen to what they want to spend and stay within that range. Also, keep their identity private until it is necessary to disclose it. This may help during negotiations. Finally, try to include all decision makers at the showings when possible. Be prepared to show properties to an assistant, agent or business manager who has been instructed on what to look for. They have trusted this person to preview the homes and should trust the feedback they provide.

Have fun!

Working with celebrity buyers and sellers can produce the same stressful moments as a regular transaction, so enjoy the parts you can. If you are like me, you enjoy your job. When you truly enjoy your job, your clients pick up on that, and it can be a more enjoyable experience for them, too.  Celebrities can be demanding, but they can also be a lot of fun. As always, FOCUS & FINISH!

Apr30

Many pro athletes are drawn to L.A.’s beach cities, Calabasas

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The South Bay, with its low-key atmosphere and sought-after beachfront, has been attracting athletes since the 1980s, when the Joe Montana-led 49ers were Super Bowl fixtures, Kurt Rambis was minting four NBA title rings with the Lakers, and Steve Sax and the Dodgers made their last two World Series appearances.

Montana, Rambis and Sax each called L.A.’s beach cities home during those championship years. The Los Angeles Kings roster, Lakers players and coaches as well as athletes for teams outside of California have joined the most recent wave of residents. In the South Bay, Manhattan Beach and Hermosa Beach have been some of the most popular spots, particularly among the reigning Stanley Cup Champions. Last year, Kings center Jeff Carter paid $5.25 million for a home in Hermosa Beach, near the team’s practice facility in El Segundo. Fellow teammates, including team captain Dustin Brown and goalie Jonathan Quick, followed suit, each buying homes in Manhattan Beach. “There is a high congregation of hockey players in the South Bay, Manhattan Beach in particular,” said Kofi Natei Nartey, director of the sports and entertainment division at the Agency. “But you also see a lot of out-of-state players who want to live here and train in more favorable conditions.” Diana Taurasi, the former Connecticut Huskies basketball star who currently plays for the Phoenix Mercury, became a resident of L.A.’s beach cities in June, buying a Manhattan Beach townhouse for $3.3 million. Former Stanford guard Landry Fields, currently with the Toronto Raptors, paid about $2 million for property in the area in July. In Calabasas, there’s a different vibe — and it’s not just reserved for the Kardashian clan. More sports figures are gravitating to the guard-gated communities in the affluent pocket between Agoura Hills and Woodland Hills, even at the sacrifice of a more practical commute. “A lot of athletes, particularly those with families, are attracted to the peaceful, gated lifestyle,” said Nartey, who has worked with WNBA star Candace Parker, former Chargers tailback LaDainian Tomlinson and Lakers guard Nick Young, among others. “When they travel, they have peace of mind. They have security.” It’s also an area where someone can get more bang for their buck, said Nartey, whose clients, many of whom are originally from the Midwest, are accustomed to larger properties. For scale, Keyshawn Johnson’s former estate, which the retired NFL star sold to Kourtney Kardashian in February, occupies nearly two acres in the exclusive Estates at the Oaks enclave. Former NBA all-star Mitch Richmond, who lives nearby, is seeking $8.495 million for his 2.23-acre property. Whereas homes were once looked at as merely trophies, many sports figures see real estate as a way to build and diversify their portfolios. “There is a shift taking place among athletes in that there is a desire to build wealth as opposed to just getting rich,” Nartey said. Tampa Bay Buccaneers safety and Carson native Dashon Goldson has purchased investment properties in Marina del Rey in recent years, as has 49ers tight end Vernon Davis.

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