Perenchio Estate Selling Malibu Land and Hoping for $150 Million
(Bloomberg) -- The late Hollywood dealmaker Jerry Perenchio started his career representing movie stars such as Marlon Brando and Elizabeth Taylor and capped it by turning Univision into the largest Spanish-language broadcaster in the U.S. Along the way, he built a $3.2 billion fortune and assembled a sparkling portfolio of Los Angeles area real estate, including a Bel-Air mansion that recently listed for a hard-to-fathom $350 million.
Perenchio died in May at 86. Now the Perenchio family is selling a package of undeveloped land in Malibu, the hyper-affluent beach enclave favored by Hollywood stars and business titans.
The portfolio consists of 70 acres spread across eight parcels, none of which has been offered for sale in more than 30 years. One lot is directly adjacent to Malibu Colony, the city’s most exclusive address; another, called Sycamore Village, sits in Malibu’s busiest commercial area, where billionaires Larry Ellison and Stan Kroenke own retail businesses; a third lot has been subdivided for four homes on Broad Beach.
“In a single transaction, someone is going to become the most important land owner in all of Malibu,” said Mark Sullivan, executive vice president at Savills Studley, who is marketing the portfolio in partnership with Mauricio Umansky, chief executive of the Agency brokerage. “They will have the opportunity to impact the look and feel of Malibu forever.”
It’s a diverse array of offerings befitting the famously private billionaire, who was allergic to media attention yet seems to have turned a profit in virtually every corner of the U.S. entertainment industry.
In the 1970s, Perenchio promoted the first heavyweight boxing match between Muhammad Ali and Joe Frazier and the “Battle of the Sexes,” the much-hyped tennis match between Billie Jean King and Bobby Riggs. Later, he helped lead the production companies serving up television hits like “All in the Family” and “The Jeffersons” and led an investor group that briefly owned the Loews movie-theater chain, flipping the business after one year for a reported profit of $140 million. He bought Univision Communications Inc. from Hallmark Co. for $550 million with two partners in 1992 and took the company public in 1996. In 2014, he bequeathed his $500 million art collection to the Los Angeles County Museum of Art, including works by Monet, Picasso and Cezanne.
Long before all that, Perenchio was collecting properties around Los Angeles, acquiring a local development company, Malibu Bay Co., in the late 1980s. In addition to undeveloped land, he owned at least 12 properties in Malibu Colony alone, according to a 2010 report from Variety.
It’s a good time to be selling. In Malibu, the median price for single-family homes was $3 million in the third quarter, up 25 percent from a year earlier, according to a report from Douglas Elliman Real Estate. Gains on the beach were even better, increasing 38 percent to $7.5 million over the 12 months that ended in September.
Buyers face two challenges. Much of the land will require local approval to develop, and it can take years to make your way through Malibu’s welter of land-use rules. The sellers, meanwhile, are marketing the land as a single portfolio, so a buyer would have to take on some parcels that are harder to develop in order to get the juiciest lots.
For example, the portfolio includes a four-acre single-family residential parcel on the beach side of the Pacific Coast Highway next to a 24-acre plot for which a developer paid a reported $50 million in June. That’s the good news. The bad: It took 11 years to entitle the property, according to accounts at the time of the sale.
While no price has been set for the portfolio, the brokers hope to get more than $150 million.
Malibu Bay Co. grappled with the rules itself. The company won City Council approval to subdivide the Broad Beach parcel into four building sites in 2009, then saw the matter tied up in court for the next three years. It spent $5 million working toward permission to develop Sycamore Village, 10 acres of commercial space, then hit a snag in 2015 when Malibu voters passed a resolution restricting landlords’ ability to lease to national chains. That measure, backed by the movie director Rob Reiner, was overturned in court after Malibu Bay Co. and another developer sued. (Irony alert: Reiner rose to prominence as Archie Bunker’s hippie son-in-law in “All in the Family,” which Perenchio helped produce.)
“Every developer in the world who looks at this project will ask if they can just buy [the Broad Beach] and Sycamore Village site and they will bid it up,” the Agency’s Umansky said. Much of the hard work of making those sites shovel-ready has already been done. But since the brokers insist the parcels are a package deal, the buyer will probably be an investment group or a wealthy person with the patience to wait out a long entitlement process.
Of the potential buyers, Umansky said, “I think personally a lot of them are local billionaires.”
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