Nile Niami’s dream of building one of the most expensive homes in the world ended in a major financial loss after his Bel Air megamansion, known as “The One,” sold for $126 million at a bankruptcy auction on March 4, 2022.
The massive property, which was once expected to sell for $500 million, was developed with money borrowed through his company, Crestlloyd, which eventually defaulted on more than $165 million in debt, according to The Real Deal.
The 105,000-square-foot mansion was purchased by Richard Saghian, the owner of fashion brand Fashion Nova. The $126 million sale made it the most expensive home ever sold at a bankruptcy auction in the United States at the time.
The sale came after years of construction delays, unpaid bills, loan defaults and legal problems involving the property. What began as an ambitious plan to create one of the world’s largest and most expensive private homes became a major real estate failure for Niami.
In 2018, Niami borrowed $82.5 million from Hankey Capital, founded by Los Angeles billionaire Don Hankey, to continue construction of the mansion. However, that loan was only part of the project’s growing financial burden, per CNN.
Over four years, Niami and his company, Crestlloyd, borrowed more than $165 million from several lenders to build and market the property, according to court filings.
Hankey Capital later issued a notice of default in March 2021 after the company failed to meet its loan obligations. The amount owed to the lender had grown to more than $110 million, according to court documents.
By July 2021, the Los Angeles County Superior Court had placed the property under receivership. This meant a court-appointed manager would take control of the property, address its problems and prepare it for sale so creditors could recover as much money as possible.
Niami began building The One in 2014 on a hilltop in Bel Air, California. The property covered about 3.8 acres and offered views of the Los Angeles area.
The developer promoted the mansion as one of the largest and most expensive homes in the world. He initially planned to put it on the market for $500 million, a price that would have made it one of the most expensive private residences ever offered for sale.
The mansion featured an extraordinary list of amenities. It had 21 bedrooms, 42 bathrooms, multiple kitchens, seven pools and a 50-car underground garage.
Other features included a nightclub, a four-lane bowling alley, a 50-seat movie theater, a beauty salon, a gym, a running track and a moat surrounding parts of the property. It also had a large master bedroom suite measuring about 4,000 square feet.
Niami wanted the home to offer almost everything a wealthy buyer could want under one roof.
“I gave them everything here,” Niami said during a video tour of the property, per CNN. “We have everything anyone could ever want in this house.”
Despite the impressive features, construction took longer than expected. The project faced repeated delays, rising costs and problems with permits and financing.
The court-appointed receiver, Ted Lanes of Lanes Management, found that the property still had several unfinished items that needed attention before it could be sold as a completed home.
Among the problems was the lack of a certificate of occupancy, a document needed to confirm that a building meets the requirements for people to use it. The property also had issues involving insurance, permits, unpaid taxes and outstanding bills from contractors and suppliers.
The catering kitchen was another concern because the permit for its commercial-grade design had been denied, leaving the space unfinished.
According to court reports, the property also had more than $2 million in unpaid taxes and invoices involving concrete, air conditioning and scaffolding.
Lanes explained that completing the required work and securing the proper documents would help make the mansion more attractive to buyers.
The financial problems continued as creditors sought payment for the money they had provided to the project.
Hankey Capital was the largest lender, with more than $115 million in loans connected to the property. Another lender, Yogi Securities Holdings, led by Joseph Englanoff, had provided more than $36 million, according to NBC Los Angeles. Inferno Realty and Maybach Corporation Holdings had also provided loans of about $7 million each.
In October 2021, Crestlloyd filed for Chapter 11 bankruptcy protection in an effort to stop a scheduled foreclosure sale. The filing halted the planned trustee’s sale while the bankruptcy court considered what would happen next.
The auction had already faced delays, including disagreements between creditors over the property’s future. Englanoff accused Hankey of trying to gain control of the mansion for himself, adding another complication to the troubled project.
The mansion was eventually listed for $295 million in January 2022. However, it failed to attract an offer at that price.
On March 4, 2022, the property went to a bankruptcy auction, where Richard Saghian won the bid with a $126 million offer.
Although the sale set a record for the most expensive home sold at a U.S. bankruptcy auction at the time, the final price was far below Niami’s original $500 million target.
The outcome marked the end of a project that had taken nearly a decade to build.
Related: In 1934, Fredric March had a Beverly Hills house built; it sold for $32.5 million in 2020, decades after Brad Pitt and Jennifer Aniston once owned it
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