trophy homes

Example of a Los Angeles trophy home.

Citing a shortage of so-called trophy homes in Los Angeles—which are usually defined as homes that cost at least $100 million—the owners of an 11-acre site near the Hotel Bel Air announced they will be adding to the city’s supply. The spread near Hotel Bel Air will be split into three separate estates, with each buyer given the choice to build what they want or select from already-designed mega-mansions that range from 56,000 to 61,000 square feet.

The plan was revealed by the real estate investment arm of JP Morgan, which Investor’s Business Daily reports purchased the land last year. These trophy homes will join several that are currently under construction and are being built “on spec,” which means no buyer is in place. According to Investor’ Business Daily, these types of homes are becoming increasingly popular among billionaires looking for some place to put their money.

There were five homes around the world that sold for more than $100 million last year, according to Investor’s Business Daily.

The project by the Hotel Bel Air is being spearheaded by developer Domvs London, which partnered with JP Morgan’s Junuis Real Estate Partners to purchase the land.

Barry Watts, president of Domvs London, spoke with Investor’ Business Daily about the plan and why Los Angeles is such a great location.

“There’s a shortage of trophy properties that are available for sale in the pocket of Los Angeles,” Watts said. “You’ve got high-net-worth people who want to own multiple homes across the world, and Los Angeles offers something different. If you want to drive your convertible car 12 months a year, it’s a city where you can do it.”

Buyers have two options: pay $45 million for one of the parcels, which already has permits in place, and build what you want; or, Domvs will build a home from a selection of designs that range up to 61,000 square-feet and have a starting price of $120 million.

Investor’s Business Daily reports construction on the first of the estates will begin in February.