The rich feel your pain, sell mansions (or try to)

The Wall Street Journal reports that, as the result of the economic disaster, plus a shove or two from Bernie Madoff, the rich are trying to unload their mansions. It isn’t going so well.

“Some Bear Stearns stuff hit the market” in the fall, says Meredyth Hull Smith, of Sotheby’s, referring to the collapsed investment bank. London brokers say they’re also beginning to see financiers selling in the desirable Chelsea and Kensington areas.

It’s a stark reversal of fortune, particularly for financiers whose appetite for amenities like 24-hour concierge service and gated estates drove prices to dizzying heights. Now, many find themselves needing to downsize in an increasingly glutted high-end market, which is falling so rapidly brokers say it’s difficult to discern how listings should be priced. [emphasis added]

Of course, not every finance chief is selling a home because of the crisis. But all sellers are pitching their homes in a changed world. “It’s a terrible time to list right now,” says Wilbur Gonzalez, of Brown Harris Stevens.

Even in Greenwich, you can’t necesarily unload your stone and timber Neo-Georgian-Shingle-style-Victorian, or not at the price you’d like, anyway.

In early November, Scott Freidheim, former chief administrative officer at Lehman Brothers, put his just-purchased Greenwich, Conn., mansion up for sale for $13.75 million, according to Greenwich listing records. He and his wife bought it a year earlier for $12.4 million. The house is also for rent. The sale is tied to Mr. Freidheim’s relocation to Chicago, where he is now executive vice president of operating and support businesses at Sears Holdings Corp., says his real-estate agent, Joe Barbieri, of Sotheby’s International Realty.

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3 responses to “The rich feel your pain, sell mansions (or try to)

  1. anonymous

    Anecdotally, my sense is many financiers are far more leveraged and cash flow-constrained in their personal finances than in past downturns, yet have far more “fixed” costs in their more elaborate lifestyles of modern era (NetJets, household staff for multiple houses, etc) vs the pikers of the ’80s….many bungled basic risk management both in their day job and in their personal life

    Lots of margin calls, worthless stock options/restricted stock, bleak bonus prospects for ’09 and ’10….and illiquid, “white elephant” primary and wkend houses

    Will be an interesting unwind….

  2. CEA

    I know Scott. Let me say: modesty and understated aren’t his thing. The money for the house did not just come from Lehman. He was “subsidized” by mom and dad as well.

  3. Stanwich

    I knew him at Lehman, he is retard that Fuld liked for some reason. Now Lampert fancies him, is every rich dude with an ego falling for this idiot. Let’s just say Scott is not the brightest star in the galaxy, nor the sharpest knife in the drawer.