In the final days of last summer, Drake and Rihanna made waves when they hunkered down for some R&R in what TMZ called “an oceanfront villa fit for honeymoonin’.” While that relationship didn’t last long (and Drake is now linked to Young Money label mate Nicki Minaj), the press had a lasting effect on the other stunner in that story: the $29 million Malibu love nest where they stayed.
“When news broke of Drake and Rihanna vacationing at one of my listings in Malibu, interest shot up,” said The Agency’s Angel Kou in an email, noting that the property rents for $5,000 per day. “People like to experience what A-listers experience, to get a glimpse of that glitz and glam.”
Courtesy of The Agency
The same desire to either get close to celebrities or live how they live also drives interest to luxury real estate listings when a celebrity has lived there; currently lives there, in the case of apartment buildings or vacation communities; or has endorsed a property in some way, either by looking at real estate in a new development or throwing a party at an existing listing.
But does this increased interest in luxury property listings translate to an increased sales price or shorter sales timeline? Not necessarily, experts say. Although when a property is priced right, some celebrity attachment might help it stand out from the competition so that the right buyer sees it that may not otherwise have done so.
Douglas Elliman brokers Tom Postilio and Mickey Conlon, who are based in Manhattan, call this the “halo effect,” in which people hear about a listing, sometimes many months after some press about a celebrity owner or celebrity-fronted event runs, which eventually translates into a sale.
“Sometimes people catch little snippets about a property as they’re doing their research,” Mr. Conlon said, “and together, it creates some cache for a property, and some urgency about the need to move quickly because everyone else has access to this information too.”
When celebrities lived in a property
The type of celebrity connection that seems to have the smallest impact on property sales is when a celebrity used to live somewhere.
For instance, Rick Pretsfelder, a partner at Manhattan-based real estate firm Leslie J. Garfield & Co. said that when he sold Dustin Hoffman’s apartment about five years ago in the San Remo, a building that sits on Central Park between West 74th and 75th streets, it didn’t factor at all into the purchaser’s decision. “This was a high-quality piece of real estate in a beautiful building,” Mr. Pretsfelder said, “but the fact that a celebrity lived in the unit did not make any difference to the buyers.”
The same was generally true when the former townhouses of Martin Scorsese and Katharine Hepburn sold without any discernable premium. “This is info that a buyer may share at a cocktail party, but the celebrity connection wasn’t a huge factor,” Mr. Pretsfelder said.
Part of the reason a past celebrity owner doesn’t make a big impact is that their names don’t often get out there; they’re often having brokers and other real estate pros sign non-disclosure agreements.
“When we have someone who’s famous attached to our projects, it helps us do our job,” Mr. Pretsfelder said, “but in most cases, the more well known the person is, the more likely he or she will be to expect discretion.”
When a celebrity endorses a property
An event with a celebrity host or guest, where they’re game for the press, can sometimes lead to more industry interest, experts say.
That was certainly the case when Heidi Klum and her entourage used the 94 Thompson St. penthouse in Manhattan’s SoHo neighborhood as their dressing room and pre-party locale before a Halloween party, bringing a tremendous amount of visibility to the $15.95 million listing, Mr. Postilio and Mr. Conlon said.
“The press was epic, and included coverage in at least 25 or 30 different publications, from Page Six to Architectural Digest,” Mr. Postilio said. With that visibility, Heidi Klum’s name also added an air of sex appeal and exclusivity. “Of all the places she could have chosen to get ready, she chose this one,” he continued, “and this led to increased interest in the property.”
But 10 months later, the apartment remains unsold, and no celebrity endorsement would change that, Mr. Conlon added. “Unless the celebrity is included in the sale, I don’t think anybody really cares to pay more because of a celebrity connection,” he said, noting that much of the increased interest after the event came from people who were just trying to get closer to Ms. Klum, and weren’t deemed serious buyers after preliminary interviews.
The duo had slightly more luck when they were the fourth brokers enlisted to sell Joan Collins’s midtown Manhattan apartment in August 2012. When coming up with their marketing strategy, they called in the “Dynasty” star herself to host a party for industry folks, friends and other influencers.
Within a short while after that party, the team had multiple bids over the asking price, which they weren’t expecting. “That’s when you know this sort of event has an effect,” Mr. Conlon said. “People were paying attention, and it was worth the effort.”
A similar event with a charity spin also led to increased interest and an eventual sale—albeit one about six months after the celeb-sponsored event—when Grammy Award-winning jazz saxophonist David Sanborn sold his Upper West Side townhouse a few years ago.
While he didn’t want to be paraded around to sell his house, he agreed to host an event benefitting the March of Dimes—a charity that he has a personal connection to—in which he talked about the property. “The proof in the pudding is that the eventual buyer mentioned some of that coverage and that story,” Mr. Postilio said. “It was clear that it had reached them in some way and had a lasting impression.”
Big names to position brands
Within the same category but of a different ilk are celebrity events tied to a property, but not meant to necessarily promote sales. This was the case when Alicia Keys performed at Miami’s Porsche Design Tower launch in March, and when Andrea Bocelli performed at an April benefit for the children of Haiti tied to the Residences by Armani/Casa, set to open in 2019. Both private events were held by the buildings’ developer, Gil Dezer, the president of Miami-based Dezer Development.
“The goal of both these parties was to give back to our owners,” Mr. Dezer said, “and to show them what it’s like to live in our buildings.”
Whether these events lead to any additional sales isn’t the point, he said, which is a good thing, because there’s no way to track if they did, he said. “It’s all about the product positioning at the end of the day,” Mr. Dezer said, “and creating an aura about the building that people want to be a part of.”
“We’re dealing with wealthy people who aren’t necessarily star struck, and have likely lived by celebrities in the past,” he said. “This is par for the course for them at this point.”
When a celebrity currently lives in a property or neighborhood
Celebrities buying in a new development or living in a building where there are additional units available is another way buyers might be enticed to purchase there too. But oftentimes, it seems that this sort of set up attracts more celebrities than it does lay people, Mr. Pretsfelder said.
“Celebrities are often looking to buy a home where there’s privacy and other residents with common interests,” he said. “Purchasing in a building where there are other celebrity tenants provides that stamp of approval.”
A perfect example of this is 443 Greenwich, a converted warehouse in Manhattan’s Tribeca that’s also a hot bed of celebrity activity, where Jake Gyllenhaal, Justin Timberlake and Jessica Biel, Ryan Reynolds and Blake Lively, Jennifer Lawrence, and Harry Styles all have reportedly purchased apartments.
One of the big draws in this building is a gated, 24/7-monitored basement garage that offers complete privacy. “This is probably the most beautiful underground parking lot that you’ll see in your life,” Mr. Postilio said, noting that it also allows celebrities to float under the radar a bit without paparazzi hanging outside their front door. “At this point, all you need to have is the cash and the Oscar or Emmy to gain admission to that club,” he added.
COURTESY OF METRO LOFT
Although on a much larger scale, celebrity property owners can also impact a neighborhood’s profile and contribute to increased prices, according to the Leslie J. Garfield New York City Townhouse Report. The report notes that specific blocks, like East 10th Street, where Mary-Kate Olsen, David Schwimmer and Molly Ringwald live, and the Greenwich Village area between Fifth Avenue and University Place, where Sarah Jessica Parker and Leonardo DiCaprio own properties, have townhouses that sell at double digit premiums compared to other similar areas, perhaps due to their association with or proximity to these known personalities.
“When a big-name celebrity moves into a neighborhood, it gives the neighborhood some credibility and tells buyers that this must be a nice place to live if this well-known person lives here too,” Mr. Pretsfelder said.
But, like anything related to celebrities and real estate, you can’t prove causation between big name residents and improved sales, Mr. Pretsfelder said, noting that there are many other factors at play.
Mr. Conlon agreed. “There isn’t any direct correlation between a celebrity living in a neighborhood and increased prices,” he said, “but if you live by someone famous, inevitably you’ll bump into them on the street and see them at your favorite coffee shop. It’s like being a member of a club.”
In Los Angeles, Mr. Kou said foreign buyers are the ones who seem the most drawn to celebrities and want to know where they live. “They see them in the media and on the big screen, but rarely in person,” he said, which can easily change if they live in the same neighborhood.
Within exclusive communities, mentioning who currently lives there or previously lived there adds an extra level of exclusivity that appeals to some buyers, he said.
A final way celebrities are connected to luxury real estate is when they’re just spotted looking at a listing, or rumored to be moving into a new development, like George and Amal Clooney were rumored to be moving into the development at 100 E. 53rd Street in Midtown Manhattan.
“Sometimes just looking is interesting enough to garner some press,” Mr. Conlon said.
“People may think, ‘if they’re looking there, why aren’t I looking there, too?’” he said.
But buyer beware: these tales aren’t always true. “This is often just the way of marketing a building,” Mr. Pretsfelder said, and “especially in the world of condos, it can be a very effective way of increasing interest.”
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