Casa La Manzana in Sotogrande was the most expensive house on the market in Spain back in 2006 when I went to see it for the Sunday Times. Thirteen years later it is still looking for a buyer, but with the vendor’s price expectations down 59% since then, arguably it is now priced to sell.
2006 was near the height of Spain’s real estate bubble. People were paying crazy prices for every kind of real estate asset, from jerry-built prefab homes in Camposol, Murcia, to Mansions in Marbella, to real estate developers like Fadesa (purchased in 2006 for €4b by Fernando Martín, bankrupt by 2008), but especially for land, which mixed speculation, corruption, and greed like nothing else. Fortunes were made and lost – I know of one person who made €80m on land speculation, and then lost the lot on the same game a bit later. Though arguably the best time to take advantage of the bubble as a vendor was between 2004 and 2006, this was not a bad time to put a trophy asset on the market with a bubble price. The financial crisis that brought the party to an end was still more than a year away.
So I wasn’t surprised by the €24m price tag for La Manzana when I went to look around it all those years ago. The vendor – Joseph Kanoui, a French business tycoon whose syndicate bought Cartier in 1972, and who retired in 2004 as chairman of the Vendôme Luxury Group, a subsidiary of Richemont, the giant Swiss conglomerate that owns brands such as Van Cleef & Arpels and Chloé, was clearly targeting the billionaire market of people like him. As I wrote in my article at the time ‘Casa La Manzana is the most expensive home for sale in Spain’, The publicity-shy Kanoui and his wife Micheline, a jewellery designer, entertained the cream of French society at La Manzana, known locally as the “Cartier house”.
Was the “Cartier house” worth €24m at the time? In retrospect, no, because nobody bought it, and it’s still on the market 13 years later for less than half the price. At the time I pointed out that “Super-luxury properties on the Costa del Sol often sell for substantially less than their asking price,” and that La Manzana was “in a class of its own in terms of typical asking prices in Sotogrande, where even exceptional properties go for between €6m and €10m.” However, if they vendor wasn’t in a hurry or distress, and was quite happy to wait for the right buyer to come along and pay top wack for a trophy asset, then there’s a case to be made for starting off at the top of the range with the asking price. But that strategy has risks.
The risk is your time and ending up selling for less than you could have, as I point out in my article last week on the trouble Hollywood star Michael Douglas is having finding a buyer for S’Estaca, his estate on Mallorca. As I explain in that article, my limited but relevant experience suggests that ultra-high end vendors start off asking too much, and spend the next five to ten years reducing their price expectations until they reach a price that suits a buyer at that moment.
Is La Manzana now priced to sell? Charles Gubbins of Noll & Partners, a real estate agency in Sotogrande and Chestertons associate, thinks so. “The €9.9m price point is realistic and has come down in steps. from €24 million in 2006, then 18 million in 2010, after which it was taken off the market for a while,” he tells me. “I listed it with Noll and Chestertons about six months ago when we were instructed by the owners. With the euro/m2 price point at a conservative 220 euro the land alone is close to five million. With over 2000 m2 in building, replacement value alone gets you close to the €10 million mark. Added to this the very mature grounds, and the heritage the property offers, I believe the price will be achievable. However, as always” it is worth what someone is prepared to pay!!!”
He goes on to point out how recent developments at Sotogrande are helping to market the resort. “To sell in Sotogrande, first you have to sell the place, and lately Sotogrande is getting a lot of exposure albeit led by Golf events (Valderrama in June this year, and the Ladies European Tour event at La Reserva) and of course the annual Polo event. Five new developments Taylor Wimpey , Kronos, Lemon, and Sotogrande SA Village Verde, are raising awareness, albeit at a different price point to La Manzana.”
So the day when La Manzana changes hands must be getting closer, but just like Michael Douglas in Mallorca with S’Estaca, had the owner got the asking price right at the start, I suspect the sale would have gone through years ago, and for a higher price than today’s asking price.