Typical ebbs and flows of the single-family home market do not have much of an impact on the ultra, high-end luxury home market, with Exhibits A and B proving just that in Naples.
For three years, the sales price record for a single-family home in Naples held at $62 million.
Then, in an early-April span of three days this year, with the volume of single-family homes on the market trending upward and the prices trending downward, the sales price record fell twice.
It fell first April 14, when billionaire David Hoffmann paid $85 million for a 17,200-square-foot Port Royal home on Naples Bay. Hoffmann, who owns more than 70 companies, as well as Hertz Arena, the Florida Everblades minor league hockey team and the Florida Weekly newspaper chain, enlisted Naples real estate agent Tim Savage of Gulf Coast International Properties five years ago to help him find his dream home.
When Savage arrived to meet with Gulfshore Business to discuss the state of the luxury home market, he arrived in a Porsche, wearing a bespoke suit and McLaren watch, pulling into the driveway of 2999 Rum Row, another Port Royal, bayfront home he has listed on the market at a mere $29.9 million.
Tim Savage
“The top of the line really sets the bar and the standard for what’s to come in the marketplace,” said Savage, who has a weekend hobby of driving race cars. “You have several factors at play. But I think at the end of the day, there’s a little bit of a flight to safety in terms of tangible assets. Hard assets. And in a place where I think we’re one of the best places to live in America. To have the lifestyle that we have here, the level of construction that we have here, there’s nowhere else in the U.S. you’d rather live.”
The luxury home market isn’t necessarily immune to recessions or rising interest rates, Savage said.
“But it’s more resilient and resistant,” he said. “The majority of the purchases here are going to be cash. So, for them, it’s really just an asset to put in a portfolio, where they’re parking cash. And obviously the appreciation here historically is fantastic.
“So, it’s an investment for them, and they’re not as subject to interest rate fluctuations necessarily on the purchase. But you know eventually, it’s kind of a trickle-up effect. And it will affect their portfolio and their investments, and it may impact their decisions.”
The price record didn’t just fall again. It shattered when an undisclosed buyer paid $225 million for a six-bedroom, 14.5-bathroom, 8,846-square-foot home, according to the home’s original listing off Gordon Drive. The price included two other properties flanking the main residence and about 800 feet of combined beachfront.
The buyer, seeking privacy, hired Naples attorney Kevin Coleman of Coleman, Yovanovich & Koester, to handle the transaction as a trustee for the buyer of record: Kevin Coleman Trust.
“Fifteen pristine acres of Naples beach is certainly a legacy property,” Coleman said. “Our policy is to protect client confidentiality.”
The deed, a public record, showed the one-buyer acquisition had three different sellers: 2200 Gordon Drive sold for $133,177,500 from Westbury Properties Florida, 2170 Gordon Drive sold for $44,910,000 from Megan Park Limited and 2340 Gordon Drive sold for $46,912,500 from Jesse’s Goodluck South Limited.
Real estate agent Michael McCumber and Anthony Caraballo of The McCumber Group at Gulf Coast International Properties brokered the deal.
“It’s been an honor to facilitate this extraordinary transaction,” McCumber said. “With four decades of experience in Port Royal, I’m proud to continue shaping the future of this community — always upholding our emphasis on discretion, professionalism and integrity.”
Hoffmann said he looked at both that property and a remaining, legacy piece of property at Gordon Pointe. The southernmost point of Port Royal remains on the market. Originally listed at $295 million, the agents are focusing on selling the beachfront property first, at $210 million.
The property at 100 Bay Road has almost 800 feet of beachfront. Owned and developed by the late Jack Donahue, founding owner of mutual fund company Federated Investors, the property has two houses on it now, one of which President George H.W. Bush once stayed in.
Listing agent Dawn McKenna of Dawn McKenna Group and Coldwell Banker Realty, said the eventual buyer likely would choose to tear it down and rebuild the 5-acre lot with a blank canvas.
A buyer could buy the combined 9 acres, as well, at the full price of $295 million.
“Because it’s a big circle,” McKenna said. “It’s 9 acres that’s completely surrounded by water. Half is bay, half is beach. There’s nothing quite like it in the entire United States. Because there’s a 231-foot-long yacht basin. Inevitably, if a buyer wants it, they can have a huge family compound. They can park their 200-foot yacht in their basin and walk to their house and then be right on the beach. It’s a very unique property. It’s a mariner’s dream.
“There are only a select few who can purchase and own a property like Gordon Pointe.”
Hoffmann is one of those select few. He said he looked at the other two properties, but his $85 million purchase fit his needs and those of his family, he said. He did not want to deal with the hassles of construction. Newbury North, a Naples company, took care of that for the original owner.
“We have 13 grandkids,” Hoffmann said. “It’s difficult to find a place that can accommodate 13 grandkids and all the family members to come to one spot.
“That’s something we had been looking for, for the past four or five years. We had pretty much given up.
“I said, gosh, if I were ever to build a house, it would be that one.” Lo and behold, personal circumstances required him to depart. His broker called and said, “‘Hey, do you want to look at this thing?’ I went in and looked at it.”
Savage called it the nicest home he’d ever been in.
“Ever,” he said. It ended up being the highest-priced home he’s ever sold, too.
“More rewarding than that though was finding the property that fit them perfectly, that technically wasn’t on the market,” Savage said. “That’s probably the best part of that sale.”
Savage and Hoffmann crunched the numbers.
Savage said Hoffmann got a great price, because not even factoring the price of the raw land, building a house that size at the current rate of about $3,500 per square foot would amount to more than $60 million.
“Tim and I agreed you could not come close to building this house, as crazy as that number is, for what we paid for it,” Hoffmann said. “That helped immensely with my decision to buy it.”
Buying means Hoffmann also needs to sell the property on which his old house sat. He enlisted Bill Earls of John R. Wood Properties to sell it, listed at $49.9 million.
“That’s the other part of the equation,” Hoffmann said. “We’ve only had it for sale for a week. We’ve had four or five showings. We’re supposed to get an offer this week. The market down here in Port Royal is pretty strong, I think. Naples is a very, very unique place to live.
“I wanted to be on the water — its proximity to downtown. Its proximity to the restaurants. I’m a tennis player, so I use that and the workout center almost daily. You get to know people easily. Everybody maintains their properties to the highest standards. You really feel like part of a close-knit community in Port Royal. It’s like stepping back in time to the way things used to be.”
But Naples won’t be the way it used to be. It continues to evolve, with a new Port Royal clubhouse under construction, as well as a Four Seasons resort and nearby Ritz-Carlton-branded residences, which will continue the mystique of the area’s elite residential real estate status, Savage said.
“The next two to four, maybe five years, it’s going to be interesting to see,” Savage said. “It’s going to all be extremely high-quality and well-managed growth.
“Naples is built out. All we have is redevelopment now. I think that bodes well for our lifestyle, going forward.”
