Musk uses $20bn fortune to buy out the neighbourhood – The Wall Street Journal

The main characteristic that many billionaires, pop stars and ultra-successful people have in common is an over-the-top lifestyle and FU attitude, although there are exceptions. Used to getting their way and basking in the admiration of others; when people criticise them, some ultra-rich do not always take kindly to it. An example of this is Elon Musk who was offended by the British cave diver who told him to stick his mini-submarine where it hurts when he offered it to look for the missing Thai children and their teacher. Not a very nice comment from a man seen to be a hero, but Musk's response was one of those knee-jerk reactions that the super-rich and powerful feel they are more entitled to use than ordinary people. Musk retorted calling Vernon Unsworth a 'paedo guy' and is currently defending himself in a defamation case for the insult. In court, Musk revealed that he did not know his precise net worth, but testified that $20bn was a reasonable estimate. He is probably going to lose some of that in this defamation claim. Musk has been using his wealth to buy houses in his street around him in Los Angeles; another 'strategy adopted by a number of the mega-wealthy'. The singer, Ed Sheeran has also been criticised for a similar tactic and is said to be creating a mini-village in Suffolk in the United Kingdom and even bought the house of one neighbour who complained about all his building projects. The Wall Street Journal has a breakdown of how Musk is buying up the neighbourhood in Los Angeles. – Linda van Tilburg.Elon Musk buys out the neighbours.By Nancy Keates ___STEADY_PAYWALL___.(The Wall Street Journal) – Elon Musk, the high-profile billionaire who has placed bold bets on driverless cars and space flights, is known for his over-the-top antics: He appeared in a Los Angeles court earlier this week, telling a jury that a Twitter message he sent suggesting a Thai cave rescuer was a pedophile wasn't meant to connote the word's dictionary definition and was in response to what he viewed as an unprovoked attack..But when it comes to his personal real estate, Mr. Musk uses the same strategy adopted by a number of the mega-wealthy: buy up the neighbourhood.Over the last seven years, Mr. Musk and limited-liability companies tied to him have amassed a cluster of six houses on two streets in the "lower" and "mid" areas of the Bel-Air neighbourhood of Los Angeles, a celebrity-filled, leafy enclave near the Hotel Bel-Air.Those buys – plus a grand, 100-year-old estate in Northern California near the headquarters of Tesla, the electric car concern he heads – means Mr. Musk or LLCs with ties to him have spent around $100m on seven properties. He didn't respond to requests for comment.In 2012, after three years of renting it, Mr. Musk bought a 20,248-square-foot white stucco Colonial mansion, according to Brian Ades, a real-estate agent with Sotheby's International Realty who represented Mr. Musk in his purchase of the Los Angeles home. Limited-liability companies with ties to Mr. Musk own two other houses on that same street, records show, including a ranch house once owned by actor Gene Wilder. The ranch was turned into a private school, other records show; in an interview on BTV (Beijing Television) published on YouTube, Mr. Musk said he created the school for his five sons.In 2015 came additional purchases that shifted to an adjacent street up a steep canyon. Duck Duck Goose, a limited-liability company that shares its addresses with the Musk Foundation and the headquarters of SpaceX, the rocket company where Mr. Musk is CEO, bought a modest ranch house for $4.3 million. A year later, another LLC tied to Mr. Musk bought a large, unfinished, white contemporary three doors down, and then, a little more than two years later, a different LLC also registered to the SpaceX headquarters address snagged a white brick Colonial next to that. All three houses sit on a cul-de-sac of five homes, making neighbors wonder whether Mr. Musk—or SpaceX—is trying to take over the whole end of the street.The buy-out-the-neighbours approach is a familiar one among the mega wealthy, including tech billionaires. Facebook CEO Mark Zuckerberg paid more than $50m for five homes in Palo Alto, Calif., while the Mercer Island, Wash., compound of the late Microsoft co-founder Paul Allen comprised 13 different adjoining lots and included eight houses.A number of Mr. Musk's purchases appear to be appreciating. Prices have grown in the neighbourhood since his first purchase, with record sales prices in recent months, says Sally Forster Jones, executive director of luxury estates at real-estate firm Compass. One real-estate agent believes the homes are to accommodate employees and associates of Mr. Musk's various businesses, while some neighbours said they think he wants to build a tunnel connecting his properties on the two different roads.In December 2018, Mr. Musk mortgaged five of his homes (four in Los Angeles, one in Northern California) to Morgan Stanley Private Bank for a total of $61.3 million, according to recorded deeds.Here is a rundown of Mr. Musk's portfolio:.PHOTO: PICTOMETRYLos Angeles, Calif.Purchased in May 2002 for $5.4285m.Sold in March 2011 for $6.453m6,500 square feet, four bedrooms, six bathroomsElon Musk bought this house in Bel-Air when he was married to Justine Musk, whom he met while attending Queen's University in Ontario, Canada. In her blog, which is filled with tales of clubbing, celebrities and parties, Ms. Musk said the house took two years to find, and the couple stayed at the Mondrian and the Hotel Bel-Air on house-hunting trips. She said neighbour Joe Francis, founder of the raunchy video series Girls Gone Wild, attended parties at their home and is "eccentric, charming when he wants to be." "We hung out constantly," said Mr. Francis, who confirmed that he lived next door.After Ms. Musk received the house in the divorce, she wrote in her blog that her financial adviser and business manager told her she had to sell it and "fire half your domestic staff." She sold it in 2011 for $6.453 million to George McCabe, the founder of a Boston-based investment firm, or as Ms. Musk described it in her blog, to "nice young man from the east coast who plans to use it as a second home." Ms. Musk didn't respond to requests for comment..PHOTO: PICTOMETRYLos AngelesPurchased in December 2012 for $17mEstimated current value: $22.3m per Zillow20,248 square feet, seven bedrooms, 13 bathroomsThe Elon Musk Revocable Trust bought this mansion from Mitchell Julis, co-founder of hedge fund Canyon Capital Advisors, according to public records. The 1.7-acre property overlooks Bel-Air Country Club, according to the listing, and includes a lighted tennis court, five garages, a pool and spa, gym and guest quarters. The house, resembling a French country estate, has a wine cellar that holds 1,000 bottles of wine and a two-story library.The purchase was later transferred to an LLC called Callisto that is linked to Mr. Musk. Mr. Musk's decision to buy multiple houses was "motivated by utility," since he has a big family and staff and puts up a lot of visitors, said Mr. Ades, the real-estate agent. He added that Mr. Musk was "ahead of his time," since the real-estate prices in that part of Bel-Air have skyrocketed. According to the L.A. Department of Building and Safety records, in 2014 Mr. Musk put in new French doors in the master suite, remodelled the master closet and bathroom and remodelled the kitchen..PHOTO: PICTOMETRYLos AngelesPurchased in October 2013 for $6.75m. Estimated Current Value: $7.8m per Zillow2,756 square feet, three bedrooms, three bathroomsThe Elon Musk Revocable Trust bought this house for $6.75m, considerably less than its original listing price of $7.995m, records show. The three-bedroom ranch house with a guest cottage, right above the Bel-Air Country Club, was once owned by Mr. Wilder, who bought it in 1976 for $314,000. It was later transferred to an LLC associated with Mr. Musk.Ad Astra, the school Mr. Musk started for his five sons (a pair of twins and a set of triplets), was registered at this address, though the school's address has since been switched to a building partially leased by SpaceX in Hawthorne, Calif., about 17 miles away. According to the admissions page on its website, the school, founded in 2014, is for students between 8 and 14 years old and is focused on problem solving, ethical thinking and collaboration. For admissions for this school year, applicants had to solve problems, such as picking one of 11 planets for a new home for humans, or deciding who is to blame for the death of a lake from pollution..PHOTO: PICTOMETRYLos AngelesPurchased in July 2015 for $20m. Estimated Current Value: $20m per Zillow7,026 square feet, six bedrooms, eight bathroomsOriginally built in 1954, this house was altered in 2009, according to public records. It sold for $1.825 million in 1998 and then for $2.49m in 2002 before an LLC called Camellia Ranch bought it in 2015 for $20m. The mailing address for Camellia Ranch is SpaceX's headquarters, and it shares a PO box with Excession LLC, Mr. Musk's family office. Jared Birchall, who works for Mr. Musk, is listed as an authorised signatory..PHOTO: PICTOMETRYHillsboroughPurchased in June 2017 for $23.364m.Estimated Current Value: $27.2m per Zillow16,000 square feet, 10 bedrooms, 9 bathroomsKnown as de Guigne Court, this 100-year-old mansion sits on 47.4 acres and has bay views, a pool, hiking trails and a ballroom. When the property was first marketed in 2013, its seller Christian de Guigne IV, 78, had made any sale contingent on him retaining a life estate in the property, which would give him exclusive use of it during his lifetime. The estate was then taken off the market, then put back on with the contingency removed.Located on a leafy hilltop roughly 20 minutes south of San Francisco and north of Silicon Valley, the property has been in the same family for 150 years. Mr. de Guigne's grandparents built the approximately 16,000-square-foot Mediterranean-style home; the family said it was designed by San Francisco architects Bliss & Faville (who also designed the St. Francis Hotel) around 1912. The main house includes a ballroom, a flower-arranging room, five bedrooms, seven full baths and two half baths. A staff wing has six bedrooms and three baths. A pavilion with 18th-century Chinese wallpaper overlooks the pool.By the time an LLC tied to Mr. Musk bought the house for $23.364 million in 2017, it was a third of its original $100m price. The only permit recorded since Mr. Musk bought the house was in October 2018, for removing and replacing kitchen cabinets. Greg Goumas, with Sotheby's International, says the house was in its "original condition" when it sold and was in need of significant modernisation..PHOTO: PICTOMETRYBrentwoodPurchased by an LLC tied to then-wife Talulah Riley in August 2014 for $3.695m.Sold in August 2019 for $3.925m3,000 square feet, four bedrooms, four bathroomsIn August 2014, a year after Mr. Musk married Ms. Riley (an actress who appeared in the 2005 film Pride & Prejudice) for the second time, an LLC tied to her bought this house for $3.695m, according to records. Built in 1959, the four-bedroom, white, mid-century modern home has floor-to-ceiling windows that curve around a crescent-shaped saltwater pool and ocean views, according to the listing. The couple later divorced.The house went on sale in February 2019 for $4.5m and sold in August 2019 for $3.925m..PHOTO: PICTOMETRYLos AngelesPurchased in July 2015 for $4.3mEstimated Current Value: $4.9m per Zillow2,963 square feet, four bedrooms, four bathroomsOn a recent late Sunday morning, the grounds of this half stucco, half stone, one-level white house looked unkempt, with a scruffy, bush-filled front yard, a stained glass window, a clay rabbit and dead plants in pots by the front door. Seven large trash bins sat outside the garage, a common sight, according to neighbours, who also said that last February the house was lit up with pink lights for Valentine's Day. Neighbours said there appeared to be people at the home sometimes, but it didn't appear anyone was living there full-time.Duck Duck Goose, an LLC with ties to Mr. Musk, paid 10% above the original asking price, according to public records. Photos from the 2015 sales listing show a brick patio and a grassy back yard overlooking the canyons, rooms with pink walls, floral wallpaper and blue floral wall-to-wall carpets, and a wood-panelled living room..PHOTO: PICTOMETRYLos AngelesPurchased in September 2016 for $24.25m.Estimated Current Value: $27.3m per Zillow9,309 square feet, six bedrooms, seven bathroomsAn LLC tied to Mr. Musk bought this contemporary made up of geometric masses, one with two-story glass windows. It sits behind a frosted glass wall. Neighbours said the property is frequently the site of construction, which started in 2011; the LA Department of Building and Safety has pages and pages of permitting record documents associated with the property, including one for a residential elevator and another for a fire-sprinkler system..PHOTO: PICTOMETRYLos AngelesPurchased in January 2019 for $6.4m.Estimated Current Value: $4.2m per Zillow3,943 square feet, four bedrooms, three bathroomsThe 1958 Frankel Family Trust sold this home to Wyoming Steel LLC for $6.4m on Jan. 15, 2019, records show. The address for Wyoming Steel is shared with SpaceX's headquarters. The home is a two-story, white brick Colonial house, with shutters, a pool and a brick front walkway lined by a white picket fence.Write to Nancy Keates at nancy.keates@wsj.com

Musk uses $20bn fortune to buy out the neighbourhood – The Wall Street Journal

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