Multimillion-dollar estate sales present unique hurdles

A complicated and delicate dance takes place whenever an estate the scale of the one owned by the late Indianapolis Colts owner Jim Irsay hits the market as it did last month.

Listing agents determine an appropriate price that fits the market, advertise the property, vet potential buyers, weigh offers, seek the best deal for their client, and negotiate fees and commissions. But what happens once the process begins is often unpredictable.

When Mike Johnson of Carmel-based residential real estate brokerage Encore Sotheby’s International Realty listed the 168-acre Indianapolis estate of the late businesswoman and philanthropist Christel DeHaan in 2022, he thought about how he wanted to market the property priced at $14 million. To attract attention, he created a 50-page color brochure and a video.

“We tried to approach it from a different approach than what somebody might [for] another expensive property,” Johnson said. “It depends on what the property is. You could have a $10 million house that’s in a neighborhood, you could have a $10 million house that’s on an estate, you could have a $10 million house that’s sitting on 200 acres of land, and there is quite likely a different approach [for each].”

With a property as large as DeHaan’s, it was anyone’s guess whether it would remain a residence or become a commercial enterprise. Johnson focused on marketing the property to people looking for a residence, while Stan Burton with the Indianapolis office of Toronto-based commercial real estate brokerage Avison Young was on board to gather corporate interest.

Ultimately, Aspen, Colorado-based M Development finalized a purchase of the estate nine months after it was listed for an Indiana-record $14.5 million. It is leased by Corte Madera, California-based RH (formerly Restoration Hardware) as a massive home furnishings showroom, interior design gallery, upscale restaurant, wine bar and outdoor furniture gallery.

“We didn’t know where the buyer was going to come from,” Johnson said. “We didn’t know if it was going to be local or if the buyer was going to be from New York, California, London, Paris.”

Palatial estates in central Indiana still cost a fraction of what they would in places like California or New York, where Johnson estimated DeHaan’s estate would fetch $200 million. However, he said the market here has shifted in the three years since her estate sold, and prices to buy an existing mansion or build one from scratch are going up.

“That property, if it was getting listed now, would not be $14 million. It would be considerably more,” he said. “I bet that the cost to build Christel’s house now would be three, four times more than what she probably needed to build it when she built it.”

If someone today built a 41,000-square-foot house like DeHaan’s, which was constructed in 2007, Johnson said, an owner would likely spend $1,000 or more per square foot of living space. (There was about 30,000 square feet of living space in DeHaan’s house, plus the basement, according to Johnson.)

And then there is the cost of purchasing the land, building a stone wall, installing gates, planting the gardens and paying property taxes. The cost to maintain a house the size of DeHaan’s would be more than $1 million per year, Johnson said.

While costs are going up, Greg Cooper, a broker with The Cooper Group at Keller Williams in Carmel, said more people in central Indiana can afford an estate than in years past.

“One thing we learned with selling these different estates is, there’s a lot of quiet money in Indiana, and it’s not flashy,” he said. “This is not Chicago or New York or L.A. or Vail [Colorado] or South Beach [in Miami]. People are not showing it off. So, there’s a lot of people who have more resources than you might think.”

Coveted land

Burton said the cost to build a house like the one that belonged to Irsay would be $40 million to $50 million. That means its $12 million listing price could be seen as a bargain.

“There’s not that much good land left in central Indiana to build that type of an estate,” Burton said. “The price they got for the Irsay house, there’s a threshold for what somebody’s willing to pay for an existing house, and it’s a buyer’s market.”

Irsay’s 9.4-acre Carmel estate was listed for sale on July 30. Five days later, an offer was pending for the property bordering Crooked Stick Golf Club, just east of the intersection of West 116th Street and Hoover Road. The estate features a 24,000-square-foot main residence with six bedrooms and 12 bathrooms, a 2,700-square-foot guest house with three bedrooms and 3-1/2 bathrooms, and a cottage with two bedrooms and two bathrooms. (The sale was still pending as of mid-August.)

Irsay, who led the Colts as owner for nearly 30 years, died May 21 at age 65.

“He finished it and then just kept doing stuff with it over the years,” Stephen Decatur, the Century 21 Scheetz agent listing the estate previously told IBJ. “And it is just absolutely fantastic. I can’t imagine how much money he really has in that. We just had to price it at a number that’ll work.”

Cooper said Carmel properties like Irsay’s are more in demand now than in the mid-to-late 2000s when he worked to sell the former Stephen Hilbert estate, which is now owned by Forrest and Charlotte Lucas, the owners of Indianapolis-based Lucas Oil Inc.

“There’s wealthy people that want to live in Carmel, and they want to build their own vision,” Cooper said. “The problem is, there’s not as much ground to do that on anymore, so more and more of those people are looking at pre-existing estates and saying, ‘What can I do to make this mine?’ And they often have the resources to do it.”

Overcoming challenges

Over the past 15 years, the estates of four prominent central Indiana families—DeHaan, Irsay, Hilbert, and Mel and Bren Simon—have gone up for sale, and each has had a different story and result.

The estate of Bren Simon, who owned the 107-acre property called Asherwood with her late husband and real estate magnate Mel Simon, took years to sell. The property on Ditch Road south of West 106th Street in Carmel included a 50,000-square-foot mansion, a 6,000-square-foot guest house and an 18-hole golf course.

“It was so ornate, so beautiful. It was breathtaking,” said Burton, who was part of the team tasked with selling Asherwood.

The size of the estate and its original $25 million price tag meant that finding someone in central Indiana to buy Asherwood would be a challenge when it was listed in 2014. After more than three years of unsuccessfully seeking a buyer, Bren Simon donated Asherwood in 2018 to The Great American Songbook Foundation.

Within months, the organization put Asherwood up for sale again. Finally, in 2021, the foundation sold the main house and its surrounding 20 acres to an unnamed individual purchaser and the remaining 87 acres to Indianapolis-based Gradison Land Development Inc., which is partnering with Carmel-based Old Town Design Group to develop the land into 40 custom home sites.

Burton said the process of selling the Simon estate taught him how to determine if a potential buyer can follow through on a purchase.

“You got phone calls and inquiries from people you just wouldn’t expect,” he said. “And sifting through the, ‘Who’s a real buyer? Who’s not a real buyer? Who’s living in their mom’s basement playing make-believe? And who has the capacity to pull this off?’ was really a challenge with both [the DeHaan and Simon estates].”

In another example of an estate that took years to sell, Cooper worked with former colleague Dick Richwine to sell the 33.6-acre property just east of the Irsay estate that once belonged to Hilbert, co-founder of Conseco Inc., now Carmel-based CNO Financial Group.

When the Hilbert estate hit the market in 2005, it was controlled by Conseco during a lawsuit over loans the former CEO took out to buy company stock. For Cooper and Richwine, that made finding a buyer even more complex.

“We were basically tiptoeing through the middle of two sets of attorneys in order to try and have the best outcome,” Cooper said. “We did not have immediate access to the property. We had great people that we worked with; however, we would have to call and get things scheduled. You couldn’t call at 10 o’clock in the morning and say, ‘I want to go at two o’clock in the afternoon.’ The logistical challenges were much, much higher there.”

After more than five years, the Hilbert estate sold in 2010 to the Lucas family for $3 million—a steep discount from its original $20 million listing.

In his career, Cooper has also sold the Zionsville estate that belonged to DeHaan before she built her massive complex along Michigan Road in Indianapolis and a Geist estate that belonged to Indiana Pacers legend Reggie Miller.

“You have to overcome so many problems when you are dealing with something of that magnitude,” Cooper said. “There’s a million little details that you have to deal with to get that property to the closing table.”•