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The rich and famous find ways to keep home sales secret

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By Lauren Beale
Los Angeles Times
Published:
  • Matt Pernice is a real estate broker in Manhattan Beach, Calif., who specializes in private "pocket" listings of luxury homes for sale.

    Luis Sinco/Los Angeles Times

    Matt Pernice is a real estate broker in Manhattan Beach, Calif., who specializes in private "pocket" listings of luxury homes for sale.

LOS ANGELES -- Madonna is selling her Beverly Hills estate, but she doesn't want you to know about it.
The sinewy singer is asking $28 million for the 16,500-square-foot, French-Normandy-style mansion. You won't find it, however, on the Multiple Listing Service, Realtor.com or other online marketplaces. Her real estate agent is quietly shopping it among a select network of Los Angeles-area brokers with deep-pocket clients.
This velvet-rope tactic, known as a "pocket listing," is being used more and more by celebrities and the wealthy in this TMZ age, say real estate agents specializing in high-end properties. Listing publicly just invites paparazzi mischief. With word-of-mouth marketing, there's no for-sale sign on the front lawn or snoops traipsing through open houses.
Actress Meg Ryan and billionaire venture capitalist Peter Thiel are among the wide-ranging contingent that has bought or sold through pocket listings in the last year.
Also fueling the pursuit of privacy, experts say, is the change in the economy.
The well-to-do have a stronger sense of needing to protect themselves and raise the drawbridge on the details of their lives, said clinical psychologist Stephen Goldbart, the co-author of "Affluence Intelligence."
A recent convert to pocket listings is Randy Phillips, chief executive of concert-promotion powerhouse AEG Live, who sold a house late last year outside the MLS. The gated estate he had renovated in Beverly Hills went for $15.5 million, more than Phillips expected to get.
"It's the only way to sell a great house," said Phillips, who has a passion for restoring homes. "Once it's in the MLS, it ages like bread on a shelf."
Pocket listings have become the signature niche of Ben Bacal of Sotheby's International Realty in the Hollywood Hills, who estimates about 70 percent of his business comes from such deals. He worked with Phillips on his sale and sold several other multimillion-dollar houses in Beverly Hills that way.
Bacal plans to expand his role with the launch of an exclusive agent platform for pocket listings. His website already boasts "pocket lister" in anticipation of its start in January.
"It's a more sensible, low-key way to sell," he said, and keep a transaction "hush-hush."
For Matt Pernice of NW Real Estate Brokers in Manhattan Beach, Calif., pocket listings are flourishing, making up to a third of all deals in the communities of Manhattan Beach and Hermosa Beach, Calif. The beach cities are popular with professional athletes and the occasional actor because the ritzy coastal location is close to Los Angeles International Airport and the Lakers' and Kings' training facilities in El Segundo.
Pernice also markets the benefits of pocket listings on his website as a buying tool for finding the best homes in a low-inventory market as well as a way to create a layer of privacy.
Some sellers don't want a sign in the ground, Pernice said. "They don't want the neighbors to know."
Beyond pocket listings, a traditional way for well-heeled property owners to shield their identities is to buy real estate in the name of a trust.
Not all stars have managed to keep a low profile. Singer Britney Spears' use of the Love Shack Trust to buy and sell houses -- including the sale this year of her Italian Renaissance-inspired villa for $4.253 million -- attracted attention because it was so specific.
"You want generic names," said Jim Cody, managing director for estate, trust and philanthropy services at the national firm Harris myCFO. "The more general the name, the better. When you Google that name, you are going to get millions of hits."
But even mundane names can lose the cloak of invisibility. Nicolas Cage's Hancock Park Real Estate Trust became commonly known when he lost his Los Angeles trophy home to tax problems.
In recent years, many wealthy real estate buyers have turned to limited liability companies, Cody said. That legal entity limits an owner's liability and, like a trust, can use a fictitious name.
Sometimes even the listing agents are kept in the dark about a property's ownership, Cody said. "The goal is (to) make it opaque to the outside world as to who the beneficiary is."

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