A sprawling mega mansion in the upmarket Los Angeles suburb of Bel Air – once touted as the most expensive private residence in the US with a price tag of $500 million – has been placed into receivership after its developer, a former film producer, defaulted on more than $165m in debt.
In the US, a property that has been defaulted on is turned over to a court-appointed receiver.
Rather than taking over ownership and liabilities, the receiver obtains the necessary permits, completes construction work, compiles a list of creditors and prepares the house for sale to pay off lenders.
The mansion, named The One, is an opulent structure spread across 1.6 hectares of land, offering views of the Los Angeles skyline.
Nile Niami, the developer, bought The One in 2012.
He began construction in 2013 and was expected to finish in 2018, but the ambitious project has been plagued by funding issues, a report by CNBC said.
The mansion is 100,000 square feet and has nine bedrooms, a private nightclub, four-lane bowling alley, beauty salon, spa, five swimming pools, a 50-seat movie theatre and an underground garage for 50 cars, with two car-display turntables.
The master bedroom spans more than 4,000 square feet and the property is surrounded by a giant moat to keep out unwanted guests.
A sky deck with a putting green, a golf simulator, 10,000-bottle cellar and two art gallery spaces are among other features.
Mr Niami, however, decided to forego some amenities, including a jellyfish tank and a frozen room with an ice bar.
Most of the developer’s earlier projects included similar features, and others such as glass-bottomed pools and cryogenic chambers.
The Los Angeles County Superior Court put the mansion into receivership and it is likely to be listed on the market at a steep discount once its court-appointed receiver, Ted Lanes of Lanes Management, completes some final touches, court documents show.
Mr Niami, who touted the property as his “life mission” and “the biggest, most expensive home in the urban world”, posted a video on his Instagram account last summer declaring it was 10 weeks away from completion, saying: “Seven years ago, I had an idea to create the biggest, most expensive house in the urban world: The One Bel-Air. And I did it.”
“There’s a lot of people out there with a lot of money – they want something no one else can have,” Mr Niami told CNBC in 2017. “This is it.”
The developer borrowed $115m from Hankey Capital, founded by Los Angeles billionaire Don Hankey, to build the mega mansion. Other creditors include Yogi Securities Holdings, Inferno Realty and Maybach Corporation Holdings, according to property documents.
The One also has more than $1m in unpaid taxes and debts from concrete, air-conditioning and tool companies, according to CNBC.
Mr Hankey served Mr Niami with a debt default notice in March.
The price of the house and timing of the sale have not yet been determined, the court-appointed receiver said.
“What I would love to see happen is that the house gets completed, the certificate of occupancy is awarded and we have an orderly sale that maximises the value,” Mr Lanes told CNBC.
“Hopefully, there will be sufficient proceeds from the sale to fund the secured and unsecured creditors and for the equity to realise some value.”