There is an interesting story just released by The Daily Telegraph, on its Web site. It is about the Candy brothers, two of the most famous and rich property developers in the US. These self made billionaires who live in Monaco, have created their fortune dealing with luxury homes, but this time they are losing an eight acre site in Beverly Hills that is going up for auction after they defaulted on a $ 365.5 million loan. Apparently they paid this parcel of land $ 500 million, just before the real estate bubble burst, but the price was already quite high then and they surprisingly overpaid for it for a lack of due diligence (here is the original article).
The golden egg kids have laid a big egg this time.
Last year they had won a suit against four British elderly con men that managed to sell them a land in Berkshire they didn’t own and collected with fraud £ 6.5 million. The British Land Registry was also conned and let the transaction move forward based on false documents, so the Candy brothers were reimbursed of their loss by the Land Registry itself; but still one would have expected a much closer due diligence for such a major purchase. And there are more controversies piling up around these two brothers that seemed always right in any transaction they did.
It looks like that these super-wealthy entrepreneurs have gotten too confident of their capability of striking the right type of deal and are becoming the easy prey of people that are taking advantage of them by selling them properties at astronomically high prices or properties they don’t even own!
So an attention to basics and the traditionally sound due diligence should never desert even the most successful much less those trying to build their own fortune. There are so many things that can go wrong in any type of real estate deal that the bigger the game the bigger the scrutiny required. I see it in my own life every day. You have always something to learn, not matter how experiences you are and by the time you believe you know it all, then you are done.
Roberto Mazzoni
Tags: "Candy brothers", "real estate investment", "Roberto Mazzoni", International Real Estate
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Lovely to see yet another example of schadenfreude relating to property “millionaires”. The gentlemen concerned have had setbacks, but sure as eggs is eggs, will bounce back from the Beverley Hills deal and remain successful.
We would all love to live in Monaco and drive Bentleys. This doesn’t mean we should hate the people who’ve actually gone and done something to achieve it.
Thank you for your opinion that has a real point to it: criticism for the sake of it is something I also dislike, yet very successful people become over confident at times and there is when their downfall begins. Making mistakes is part of the daily life of any entrepreneur, but nothing will cure a disregard to basics, like due lack of diligence and proper evaluation. Losing money is not the problem, is how you do it. I hope this story remembers everybody that basics can’t be disregarded, independently of how rich you are or how successful you have been.
Real Estate is one of the most lucrative business to engage with. i also like to invest on it.–`