The Ultra-Rich Living Richer: L.A.'s Giga-Mansions Spark Feuds Between Developers, Residents

Real estate developer Mohamed Hadid lives in a 50,000-square-foot mansion that has 300-seat ballroom, a 5,000-bottle wine cellar and a home theater with 70 seats. PlayABC News
WATCH The Fight Over Los Angeles's Giga-Mansions

Some high-end developers are giving up on the McMansions for the new “giga-mansions,” in the Los Angeles neighborhoods of Beverly Hills and Bel Air, but many residents are upset over the construction of these enormous, extravagant homes.

Luxury mansions soaring above 20,000 square feet are popping up on street after street in these areas, some reaching a staggering 90,000 square feet -- bigger than the Taj Mahal and the White House combined. Nearby residents, including Jennifer Aniston, whose house is roughly 8,500 square feet, have been voicing outrage to city officials over these giant homes, claiming they are ruining their neighborhoods.

Mega real estate developer Mohamed Hadid, who is the ex-husband of “Real Housewives of Beverly Hills” Yolanda Foster and father to model Gigi Hadid, has made a career building luxury hotels and homes for the uber-rich. He lives in a 50,000-square-foot mansion in Beverly Hills that has a 300-seat ballroom, a Turkish bath, a large infinity pool, a wine cellar, a home theater and a 5,000-square-foot guest suite.

Hadid said there is a new generation of global billionaires driving this construction boom.

“There is a need for it,” Hadid said. “And there are customers asking for it… they want to have a splash, to have 200-300 people at a party, they need to have several bar areas, an outdoor area, something specific about the house that is different than anyone else.”

But to some, this giga-construction feels more like a giga-invasion. Just yards from entertainment attorney Joe Horacek’s front door, Hadid is developing a 30,000-square-foot home made of glass, steel and cement.

“I feel the privacy is completely and totally gone,” Horace said.

Joe Horacek said he lived a quiet life in his modest home tucked away in the hills until the house above him was torn down for new construction.Joe Horacek said he lived a quiet life in his modest home tucked away in the hills until the house above him was torn down for new construction.
Joe Horacek said he lived a quiet life in his modest home tucked away in the hills until the house above him was torn down for new construction.

Horacek said for 15 years he lived a quiet life tucked away in the hills until Hadid bought the house above him, tore it down, and began excavating thousands of cubic yards of soil from the hillside. Once finished, the home will have two wine sellers, a movable bar and a wrap-around infinity pool.

“Personally I see the Starship Enterprise,” Horacek said. “I get very angry.”

Horacek is worried the mansion above him could crumble on top of his house.

“[My] biggest concern is a combination of the total invasion of privacy, the total disregard which I believe Mohamed Hadid has for the building code… and for the safety of living beneath it,” he said.

The city of Los Angeles investigated and issued a stop work order after building inspectors found that Hadid added several unapproved features to the home. Since then, Hadid went back to the approved building plans. His attorney Benjamin Reznik told “Nightline” that “it’s going to be simpler to remove those add-ons now and have the house comply with the original set of plans so that our client can finish the project.”

Hadid said the order came “because neighbors had complained to the city and they decided to look into [the permits].”

“We had our permits correctly,” he added.

Real estate expert David Kramer said this high-end real estate boom started with the sale of famed TV producer Aaron Spelling’s 56,000-square-foot home.

“People saw the reality of, we have buyers here,” he said.

Kramer sold the Spelling home for $85 million, and says it opened the flood gates for larger, luxurious homes.

“Everyone thinks it’s foreign buyers, it’s everybody,” Kramer said. “It’s local, it’s entertainment, it’s hedge fund, banking, computer, definitely, technology people, and then a lot of foreign buyers. Probably 30-40 percent are foreign buyers.”

Fred Rosen, who created Ticketmaster, recently started the Bel-Air Homeowners Alliance. He cringes at every large construction truck that drives through his neighborhood. Rosen says over one million cubic yards of dirt has been dug out of the hills around Bel-Air for new mansion construction and the City of Los Angeles is letting it happen.

"You have 1980s rules for 2015 technology,” Rosen said. “There’s always somebody with more, so that’s not the issue, we just want them building safely."

Maureen Levinson, a Bel-Air mother of two, is a member of the alliance who lives down the road from a 90,000-square-foot home under construction. She claims she often videotapes workers from around the neighborhood when cement trucks block streets or when their work starts earlier than the permits allow.

“There’s wildlife here, and that’s the way Bel Air used to be, very peaceful and quiet,” Levinson said. “[Now, the construction trucks] would come down in conveys, they were like a freight train.”

Levinson’s neighbors’ 8,000 and 10,000 square-foot homes are considered “tear downs” when there’s a multi-million dollar view to be had in a new giga-mansion. Now some are just waiting for this ultra-rich real estate bubble to burst.

Levinson said she believes there won’t be peace and quiet again for “many, many, many years.”

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