Sunday, December 16, 2007

Phew! Veronica Hearst Saves Manalapan Mansion

Thanks to the good deeds and generosity of Billy Blabbermouth, who sent us an excellent link to a very interesting December 12, 2007 article in the Daily Business Review, Your Mama has learned that not only does it appear that the widow and heiress Veronica Hearst will be able to keep her mammoth Manalapan mansion through a complicated finance restructuring scheme that our booze soaked brain can barely comprehend, but we also learned that last year the 28,000 square foot, 52 room ocean front spread cost The Widow Hearst a bone crushing $375,000 in taxes, an additional $205,000 in insurance, and another $44,000 a year in utility expenses. And children, that does not even begin to cover the staffing costs, the vast landscaping bills, or the general maintenance and upkeep on the 3.5 acre estate. Jeezis, Mary, and Joseph, sometimes Your Mama forgets just how much money it really requires to live large in America.

Dubbed Villa Venezio, the 9 bedroom and 12 bathroom estate with detached guest house, which The Widow Hearst scooped up for $29,900,000 just a few months before her fabulously rich newspaper scion huzband Randolph Apperson Hearst met the big banker in the sky in December 2000, had been on the market earlier this year for $27,000,000, three million clams less than the purchase price. Uh oh.

Turns out the property was listed for sale as part of an agreement to keep the property from being foreclosed on. See puppies, there's no need to feel too bad because you can't spare the bucks to pay your overdue credit card bill, even super rich socialites sometimes have cash flow problems.

Anyhoo, the well born, well bred, well married and multi-lingual Miz Hearst, who is apparently a Bible scholar, inherited much of her vast wealth from her dead huzband. However, it would seem from the Daily Business News article that much of her inherited assets are tied up in trusts that do not allow her free and easy access to quite as much paper and coin as a jet setting socialite might require. So, like many asset rich and cash poor folks (i.e. Michael Jackson), Miz Hearst borrows against the assets to pay for her couture lifestyle. Well, unless you're careful, have good attorneys and bankers, and are constantly shifting assets and restructuring debt, that shit can quickly catch up with a ladee and her Louboutin kitten heel mules.

From the sound of things, the debt restructuring is not complete or a fait accompli, which means the possibility still exists that The Widow Hearst could lose Villa Venezio. However, Your Mama suspects that should her attorneys and bankers not be able to force her financial ducks into a row, the couture clad heiress will need to be dragged kicking and screaming from her beloved Palm Beach behemoth. And children, who could blame her?

Miz Hearst, mother of young and social gal about town Fabiola Beracasa and step-mother to former SLA tool Patty Hearst, lives primarily in a plush Fifth Avenue co-operative apartment in New York City. She also reportedly owns another estate in North Castle, NY, which, for those of you who like Your Mama don't know where that is, lies in ritzy Westchester County just north of New York City.


Anonymous said...

Good morning Mama! Thank you for the picture from Palm Beach. Many of the chilruns are up to their eyeballs in snow today, so that's a pretty picture.

Anonymous said...

If Miz Hearst hadn't spent so much damned money on restructuring her face, maybe she wouldn't have had to restructure her damned fi nances.

Anonymous said...

Mama, it's Randolph Hearst.

Anonymous said...

Over Veronica Hearst's dead body will the Palm Beach manse go into foreclosure and be sold. She loves the house and she will do almost anything to keep it, I would not be surprised if she ended up suing her late husband's estate to attempt to break up the trusts that keep her vast fortune away from her well manicured talons.

Anonymous said...

I remember Ted Kennedy said the main reason they sold his parent's Palm Beach property was because it cost $1mil a year to maintain it and they seldom used it. That was several years ago so you can imagine what it costs to keep one of those places up now with inflation. Add to this the fact that the Kennedy family did everything as cheaply and as slip-shod as possible according to a book I read (they only painted the front of the house for example).

Anonymous said...

Not that I'm disagree with Doug at all (I'm not, he's right about how the Kennedy's do things)...but the other reason the Kennedys quit Palm Beach was because they never managed to crack the highest echelon of society there because they are Catholic.

luke220 said...

I think that there are many reasons other than their religion for not accepting the Kennedys with open arms (and I am democrat).

Regarding the Hearst spread, she should be paying closer to $600,000 per year for property tax. Everyone else in Florida pays 2% of purchase price.

Anonymous said...

From the Daily Business Review
Hearst Lost Mansion
February 25, 2008 By: Polyana da Costa

When famed pro golfer Greg Norman walked into the Palm Beach County Courthouse on Monday, people suspected something unusual was happening.

Web Extra:
Notice of sale

Summary Judgment

It was. Norman, along with a throng of TV news crews and well-dressed potential buyers, were on hand for the long-anticipated foreclosure auction of the 52-room mansion of Veronica Hearst, widow of newspaper heir Randolph Apperson Hearst.

The show didn’t last long as lender New Stream Capital bid $22 million for the 3.5-acre oceanfront property.

Hearst owed more than $40 million to New Stream Secured Capital, in one of the largest single-family residential foreclosure cases ever in South Florida.

Norman, known on the PGA tour as the “Great White Shark,” didn’t bid on the mansion during the auction, but sat in the rear of the room with the lender’s representatives and later huddled for about 15 minutes with New Stream’s principal, Donald Porter, and New Stream’s attorney, Alan Grunspan of Carlton Fields.

Norman said he was “an interested bystander” who wanted to get an idea of what the property was worth in the current residential real estate slump.

A source familiar with the foreclosure confirmed Norman is one of eight potential buyers “seriously” interested in acquiring the Hearst estate.

Norman, a native of Australia, has been shopping for a house in the Manalapan area for a few months, according to several brokers of luxury residences who did not want to be identified. Recently he and his fiancee, tennis pro Chris Evert, toured a house at 820 S. Ocean Blvd., which is listed for $36.95 million. In late 2006, Norman bought a $7 million mansion in Boca Raton’s Le Lac neighborhood, which is a walking distance to Evert’s current house.

Dozens of properties are auctioned at the courthouse each morning but the bidding doesn’t typically attract the attention of celebrities. A small gaggle of television reporters and well-dressed lawyers and bankers also waited anxiously for the main event – the sale of the Hearst mansion.

They waited for Palm Beach clerk Sharon Bock to go through a list of more than 50 foreclosure properties being auctioned Monday until she called up New Stream Capital to start the auction on the Manalapan estate.

The auction, which started with the standard $100 bid, lasted less than five minutes.

Attorney Drennen L. Whitmire Jr., principal of South Ocean Capital, was the most ambitious individual bidder, dropping out at $21 million. He later declined comment.

Hearst last month thought she had secured financing to allow her to pay off the New Stream mortgage loan without refinancing or selling the oceanfront mansion.

“The funds didn’t come through, so we decided to let New Stream take over the house,” said Hearst lawyer Al LaSorte of the West Palm Beach office of Shutts & Bowen.

LaSorte said there was a “glitch” in a bond deal Hearst expected to use to rescue her mansion. He declined to provide details or name the potential source of the failed financing.

LaSorte said after the deal failed Hearst considered negotiating a down payment with the lender to allow for more time to sell the property, but they decided that pitting bidders in a foreclosure auction was the best way of getting the most value out of the house.

Hearst’s husband paid $29.87 million for the estate a few months before he died in 2000.

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The New Stream debt was costing Hearst about $16,600 in daily interest, according to an order by Palm Beach Circuit Judge Jeffrey Winikoff allowing New Stream to auction the house. Her tax, insurance and utility bills cost her $600,000 a year.

Although the lender now owns the house, Hearst’s problems aren’t over. She’s still on the hook for the balance of the mortgage.

“We know it won’t sell for $40 million, but I’m hoping New Stream can sell it for at least $25 [million] or $30 million,” LaSorte said.

In court filings, Hearst lists other properties as collateral on the New Stream mortgage, including a co-op apartment on New York’s Fifth Avenue; an estate worth about $5 million in North Castle, N.Y.; and an art collection, which is estimated to be worth about $3 million.

New Stream attorney Grunspan said any of the collateral will be auctioned to pay off her debt if the house sale does not cover the amount owed.

The mansion has been on and off the market for several years. At one point, it had an asking price of $27 million.

“We had offers between $15 [million] and $17 million but we saw things heating up in this auction today,” LaSorte said. “We are looking to reduce [Hearst’s] debt as much as possible. The more money the lenders can get for the house, the better it is.”

Several real estate brokers attended the auction on behalf of clients, including Geoffrey Thomas of the Corcoran Group, who had the house listed at $27 million for about a year. Thomas declined to name his auction client.

Eric Christu, an attorney at West Palm Beach-based Elk Christu & Bakst, said he also had a client interested in the property, but Christu did not bid during the auction.