July 24, 10:03 a.m.: If you happened to walk into 908 Bel Air, you’d likely be bowled over by the sweeping views of Los Angeles, the 29-foot ceilings and the 90-foot infinity pool. But you’d also have to stop and ogle at the art: a massive painting by Sterling Ruby in the entryway, one of Mark Flood’s “Lace Paintings” before you go into the living room, a Damien Hirst butterfly painting above the fireplace.
Those are just a few of the pricey pieces of art on the walls of the $180 million spec home, which is listed by Compass and Hilton & Hyland. The collection, which is valued at seven figures and includes more than 40 works of art, comes from Creative Art Partners (CAP), a company that provides fine art to luxury homes on the market in Los Angeles. The company curates everything from paintings and sculptures to video and light installations, blending well-known artists like Hirst, Lucien Smith and Jeff Koons with more up-and-coming talents like Ruby, Oscar Murillo and Beth Letain, according to spokesman for the company, Alexander Ali, CEO of public relations firm the Society Group.
Launched in 2017, CAP’s art placement service is an added tool for ultra-luxury sellers and developers looking to unload their high-end homes. As spec homes in Los Angeles have proliferated and the market has started to soften, it’s increasingly important to differentiate these properties — and fine art that matches the level of craftsmanship can be a game changer, brokers said.
“On the luxury and super-luxury homes, the art is very, very, very important,” said Compass’ Sally Forster Jones, who’s been working with CAP for the last year and a half. “[Otherwise] you wind up with a beautiful property, expensive furniture, expensive staging … and then art that is not commensurate, which just doesn’t work.”
Jones said she has five current listings with CAP and another dozen in the pipeline. “I view it as critical when I am working on getting a property ready,” she said, adding that she’ll often incorporate CAP into her pitch to the seller.
Based in Los Angeles, CAP has more than 80 active projects in L.A., New York City and Dallas, with expansion to Chicago and San Francisco in the works, and it owns more than 15,000 works of art, according to Ali. CAP has curated collections for homes that range from $2 million to Nile Niami’s $500 million The One, “which has an entire art gallery in it,” Ali said.
“It’s a misconception that it’s just for $100 and $200 million homes — it could be for a $5 million home,” he said. “It may not be a seven-figure collection, but the same principle applies that it’s art that’s commensurate with the home.”
CAP is not the only firm in this game. Issa Ababseh opened Fine Art Haus in January. Ababseh said Fine Art Haus has done about 10 residential and commercial properties thus far and takes a hyper-personalized approach to each project.
“Curating an art exhibition is so much more than putting something up because it matches a pillow or a carpet,” Ababseh said.
The concept of using fine art to sell homes has been around for a while, but in a much more piecemeal way. Some brokers had relationships with galleries and could borrow select pieces, but the logistics got complicated and the art itself was limited to what the gallery had on hand. This year, Paul Wylie of Lamerica Homes partnered with the Revolver Gallery to showcase several original Warhols as well as Warhol’s 1974 Rolls-Royce Silver Shadow in a Trousdale spec home. Buyers could purchase the home at 1049 Loma Vista Drive for $17.75 million with the art or $15.625 million without it.
This level of art doesn’t come cheap; it can cost anywhere from $2,000 a month to $20,000, which is footed by the developer or seller. Because of this, art placement tends to be more common in homes that are above the $20 million price point, according to Andy Butler, marketing director for Aaron Kirman.
“The house has to make sense for it to do an art stage,” he said. “It’s L.A., so there’s a lot of $5 million houses that are kind of shitty. There might not be any good walls for art; a lot of the ’90s and early 2000 Mediterraneans are super dark, especially in contrast to the moderns now that are all windows and light.”
Unsurprisingly, it’s the spec homes that have received most of the art staging up until now. These properties have a more acute need for personality and pizzazz, especially since there’s an abundance of them on the market. Many spec homes have seen price cuts over the last year, most notably Bruce Makowsky’s Billionaire, which dropped to $150 million from its original asking price of $250 million. Older homes that appear more authentically lived in don’t always have the same need for a brand-new art collection, especially since many sellers have collections of their own on the walls.
But as high-end art staging gains traction, brokers are starting to recommend it for older homes as well, particularly those that need a refreshed look after languishing on the market. Like these pricey spec homes, they’re sitting on the market and experiencing multiple price cuts in the process. The Spelling Manor recently sold for $120 million, down from its original list price of $200 million, while the list price for the Chartwell Estate has dropped to $195 million from $350 million.
Only 57 closings occurred for luxury single-family homes in L.A. during the first quarter of 2019, compared to 83 during the same period last year, according to a report from Douglas Elliman. (Elliman defines luxury as the top 10 percent of MLS-listed sales.) Median home prices in Bel Air-Holmby Hills, Beverly Hills and Malibu dropped 13 percent, 20 percent and 32 percent, respectively, between May 2018 and May 2019, according to Elliman’s micro report for May 2019.
With the recent slowdown in the market and the lowering of pricing expectations, it’s natural to ask whether high-end staging could be on the chopping block. But, so far, many are doubling down on it.
“As brokers, if the market is in a shift, you have to put your best foot forward with your marketing,” said Jones. “And part of the marketing is property preparation — you want it to stand out and be the property that a buyer gravitates toward.”
A buyer looking in the $20 million range will typically view at least 10 properties, said Rochelle Maize, a broker for Nourmand & Associates. While there aren’t stats proving that art does in fact sell a home, anecdotally, she said, the high-end staging makes a big difference.
“If you walk into a great house and it’s just empty, especially after seeing so many that are staged, [buyers] can’t figure it out,” she said. “Women get it more, but men just don’t. [Staging adds] the emotional value. You can imagine your dinner party at that table, you can imagine throwing a party in the backyard with the perfect furniture.”
The Agency co-founder and President Billy Rose said he’s seen staging of gym equipment, wardrobes, high-end wine and cars — all efforts to help buyers imagine themselves living in the space.
“We’ve seen an evolution in what’s being provided,” Rose said. “There was a period of time when you sold vacant homes. But somewhere along the way, [brokers] became more conscious to the fact that buyers have a difficult time psychologically grasping the way a space can work.”
Brokers and developers also replace art in the hopes of reviving interest in a listing that’s been sitting on the market. CAP switched out most of the art in the collection at Opus, a Niami spec home in L.A. that’s been on the market since 2017. The goal was to “soften” the home’s look, including bringing in one of Smith’s “Rain Paintings,” which were made using fire extinguishers filled with paint and helped Smith make his name.
If a house has been sitting on the market, adding high-end art can improve its look without a major investment. “[That] gives agents a reason to do another showing,” said architect Paul McClean, who designed 908 Bel Air and has been working with CAP since its early days.
Kirman, meanwhile, cited two luxury properties that had been on the market for several years. When his team got the listings, it tapped CAP and had one of the homes in escrow within a few months, the other in just weeks.“When the buyer walked in, they were captivated, they couldn’t believe it,” he said.
Kirman acknowledged that the market’s long-term impact on high-end staging is “still TBD.”
“Let’s be honest, it’s not a cheap thing to do,” he said. “The industry has changed with the level of competition with the art and the staging and the furniture and the TV and the movies. All these added costs are definitely making developers feel the pinch.”
For every home, there’s a cost-benefit analysis to determine how much should be spent on staging, said Maize. For luxury homes in the $12 million-to-$15 million range, she said art staging would likely be the first thing to go if people need to cut costs. Still, she sees the value even at that price point. She’s currently working with CAP on a $12 million “Wellness House,” by developer Tony Sater, which is set to list this month.
The focus on high-end furnishings has also shifted in recent years, as luxury buyers recoil a bit from cookie-cutter staging and want to see unique, personalized environments.
Meridith Baer and Vesta are standard fare for luxury homes in Los Angeles; both are L.A.-based, but Meridith Baer also has offices in San Francisco, New York and Miami. For ultra-luxury properties, brokers said it’s becoming increasingly common for developers or sellers to purchase furniture for the homes themselves, often custom-made, from companies like MASS Beverly, Minotti or Visionaire.
“Particularly on the high end, we’re selling a lifestyle,” said Rose. “How will you use this space? How will you live in here? Furnishings can do that. They can elevate the look.”
Maize recently worked with Vesta to create custom cushions for the rooftop of a Santa Monica penthouse that sold within a week. She said some of the bigger staging companies are willing to create custom products, but it tends to be on a case-by-case basis. For the $12 million Wellness House, she worked with Vesta and stressed to the firm how much she didn’t want the home to look “staged” and didn’t want to be able to pinpoint the stager.
“Whether it’s a $5 million home or a $100 million home, I can tell you within two rooms who the stager is,” she said. “There are certain pieces that [the staging companies] love that are just kind of generic to their brand.”
While Maize said she’s “100 percent for staging,” she added that companies will need to get more creative in order to differentiate their looks.
Maize has a 400-square-foot room in her own home devoted to accessories that she uses for staging. She’ll bring in coffee-table books and vases for common spaces and Hermès and Chanel boxes for the closets to make a home feel more personalized and lived-in.
Brokers are starting to offer staging as part of their overall service as well, whether it’s complimentary light staging or full-on services like Compass Concierge, recently launched by the residential brokerage, which takes the staging price out of the closing cost.
The future of staging
Not only does high-end staging create an environment buyers can see themselves living in — they frequently view it as a turnkey solution and want to buy the pieces along with the house.
“When you talk about the types of homes that are getting the uber-high-end level of furniture and art, these are people that often have tens of millions if not hundreds of millions of dollars. By and large, they’d like to have their housewarming party tomorrow,” said Rose.
The higher the price point, the more likely it’s a second or third home and the buyer “wants to bring in their toothbrush and have it ready to go,” Jones said. For its part, CAP gives buyers the option of purchasing or leasing the art. The company also gives brokers and developers a commission if buyers end up purchasing the art.
“It often represents the best version of what it is that could go there,” The Agency’s Rose said. “And when it’s done hand in hand with a designer, furniture showroom or manufacturer … it becomes an integrated, harmonious home.”
Rose theorized that there could be a move into virtual staging if costs need to be cut, but he acknowledged the deep emotional connection that art can create.
“When you see [art that’s] fresh and exciting and dynamic, it lifts you and you bring that energy and emotion to the property,” he said. “And when you leave, you may reflect on [the property’s] appeal, not realizing that it was the art.”
Written by Aimee Rawlins
Source: The Real Deal