The Most Expensive Land in America

I am often asked where the most expensive place tolots had a collective total selling price of about $31
live in the South Bay is. Interestingly, the answer to thismillion, or $5 million per lot. By strand standards, this
question has been shifting with time. Ten years ago,average is not particularly noteworthy. It is the added
the answer was, by a long shot, the sub-area ofvalue created by combining lots and building prominent
Rolling Hills. The median price there was a full $600,000homes that make this story far from finished.
higher than the next closest area, a significant gap atBefore I carry on about why I think this piece of the
the time. This past year, the Hill section of Manhattanstrand will potentially forever raise the bar on home
Beach managed to pull ever so slightly ahead ofvalues at the beach, I thought I would put this into a
Rolling Hills to claim the crown with a median price justbroader context. Every year, Forbes magazine
under $2.5 million. However, looking at this with respectpublishes its list of the most expensive homes in
to area masks the much higher cost of buying on theAmerica. Last year, two of the top three homes were
strand. In the last couple of years, the cost of entry toin the Los Angeles area. The most expensive home
buy on the strand exceeded $4.7 million. It is worthwas selling for $100 million in Beverly Hills and the
noting that through this past year, the price of a strandnumber three home on the list was listed at $85 million
home has not varied all that much with respect toin Bel Air. If you look at the Bel Air price with respect
location when all things are considered. This may beto land area, which turns out to be greater than the
about to change in a big way.Beverly Hills home, the home prices out to about $20
For the past ten or so years, the 200 block has beenmillion per half acre of land. As a side note, a couple of
undergoing a remarkable, game-changingacres in Lancaster, CA will set you back about
transformation. In 1998, ten beach bungalows occupied$15,000. The six homes on the 200 block of the strand
216 and 220 The Strand (shown above). They weresit on just under a half acre. Therefore, the $31 million in
on the market being sold as two separable lots at thetotal acquisition costs for the six lots already
time. A very well known local professional athletesignificantly exceeds the land value of the top most
purchased both lots for under $4 million and ended upexpensive homes in America.
selling them less than three years later for $9.8 million.The home on the triple lot is finished and it looks
The buyer managed to pick up the adjacent lot as wellimpressive. The home on the south corner of this block
soon thereafter for a tad over $3 million in the summeris expected to be completed by Labor Day. There are
of 2001. At the time, the remaining three lots were allrumors swirling around that the now double lot in the
independently owned by the same parties and hadmiddle will begin its transformation as early as next
been for at least ten years.month. So by the end of 2011, this block will have three
In 2004, the property on 200 The Strand washomes, instead of the usual six, and the collective value
purchased by a non-occupying owner. By early 2009,of these homes could potentially exceed $60 million
the homes on 204 and 208 The Strand were bothaccording to the handful of people that I have spoken
purchased by a single investor and the triple lotto about this. That's a far cry from the average value
property was converted into a substantial single home.of under $2 million per lot placed on these homes back
The closing prices for the three individual propertiesin 1998 and the quite possibly the beginning of a new
ranged from $5.5 million to $6.7 million, consistent withhome pricing paradigm on the Manhattan Beach strand.
other strand sales at the time they occurred. The six