Purple Prince Sent Packing

News is that Manuela Testolini has filed for divorce from singer Prince (Rogers Nelson) in Minnesota on May 24th. Toronto native Testolini and, very occasionally, Prince, shared a mansion at 61 The Bridle Path, an estate in the toniest of Toronto suburban neighbourhoods with the same name.

Testolini bought the mansion under the corporate name Gamilah Holdings in October 2002 for C$5.5 million, and subsequently added a tennis court, pool and elaborate steel and frosted glass gates. (Gamilah is the title of one of Princes's songs.)

Testolini, an obsessive Prince fan for years before she knew him, sought and obtained a job at Prince's Paisley Park Studios in Minneapolis and eventually married him. Once he divorced his previous wife, that is.

Should the split be finalized, and Testolini end up with the mansion--it is in her company's name, after all--it will be a quick rise from her humble beginnings in her parent's crowded two-bedroom Don Mills Road apartment five minutes away.

But don't count on it. The property was purchased with a C$4.6 million mortgage, which we can presume has not been paid by Gamilah Holdings without a little help from the Purple Prince, who may now have a change of tune.

Atlas Shakes His Head

Every morning I turn to my daily news sources for the latest take on how life would become better in dozens of ways if only some new law, regulation or sweeping "tough" measures were enacted by some level of government; and if only people and businesses weren't so "greedy" in fulfilling their needs in "bad" ways and just followed "expert" government advice, how much we would all benefit; if only we'd surrender away that last 40% of our income not taken in taxes how much Mother Earth would love us.

"I'm tryin' [to understand] Ringo. I'm tryin' real hard."

List with a Stranger, Lose a Friend

Should I list my home for sale with a friend? Here's the response on one financial advice site: "I would strongly suggest that you do not use a friend. You stand a good chance of losing the friend."

As a real estate broker for 17 years, I figure you've got a 99.999% chance of losing that friend if you don't list with them!

For those who need an explanation, you're handing thousands of dollars to a total stranger with no higher qualifications than your friend on the grounds that you want to retain the friendship.

If you've got more than one friend who's an agent, I'm sure you can finesse it with references to experience, specialization and the like

Poor Credit Makes Good Business

I manage a small portfolio of equity that specializes in loans to the hard-to-lend to, virtually all of which are second mortgages. This is called "equity lending," because the equity in the property--the amount that is left over after all mortgages and liens against the property are paid off--is our main security against default loss.

While this category mostly covers persons with poor credit or recent bankruptcies, it also includes: persons with no credit, such as those new to the country or newly-employed, persons with no provable income, no income, the self-employed, too much credit; those over 70, whom the banks generally decline; persons who don't want any further debt obligations noted on their credit reports; and for properties under development or renovation.

Contrary to what some might think, the borrowers are frequently high-income earners who have just taken on too much debt or face special situations. We've lent to medical specialists, accountants, senior executives and independent business owners.

With the very rare exception, we only lend on the borrower's principal residence--even when the purpose of the loan is to facilitate the purchase of another property.

Over 15 years of doing this, knock wood, we haven't lost a cent of principal or interest owed. Unlike the institutional lenders, if we can't find "product" we don't stretch our criteria. No one's job or bonus depends on how many commitments we make. I'd rather be all in cash than biting nails over pending powers of sale.

Our current mortgages carry a face rate of 13-15% with up-front commitment fees averaging 1-2%, plus legals and the broker's fee. [This is NOT a solicitation of business as legally we cannot originate loans unless we are registered as a mortgage broker.]

Canadian Billionaire Moving on Up

Alexander and Simona Shnaider will likely be on the move in a year or so. The Russian born Shnaider, with an estimated worth nearing C$2 billion, closed last May on a C$4.3 million 2.3 acre lot at 10 High Point Road.


Starter Home
The Schnaider home on Old Colony may be on the market again. Last year, it was listed for $10.9 million but there were no takers. "Try an offer. Seller has bought firm!" (Be sure to put aside a bit extra for the more than $50,000 in yearly property taxes.)

The Shnaider's current mansion, a spectacular but relatively low-key French-style stone country home on Old Colony, is on a puny lot of less than 4/5 of an acre backing onto a public elementary school. I guess sometime soon they'll retry flogging the old dump to mere multi-millionaires.

$45 million Fixer-Upper

Meanwhile, next door in Oakville, the Peter Gilgan family, owners of Mattamy Homes is testing the market with their own family mansion:a 32,000 sq. ft. nine-bedroom, three-storey, 22 bathroom estate on 1,000 feet of Lake Ontario shoreline for $45 million. (Video here.) Your own baseball diamond is included.

Odds are that it will be picked up by a developer and cut into lots for 23-25 luxury homes. It's a bit of a fixer-upper, according to a Toronto Star story, which made a point of withholding the name of the owner; the breakwall is in need of repair and the boathouse needs dredging. And, judging from a couple of accompanying photos, an interior designer with taste could do wonders. But perhaps the decorating budget was trimmed after coughing up property taxes of $196,000 a year.

Luxury Home Builders on the March

Lots of new "low-end" luxury homes--C$1.5--C$2 million--are languishing in the Toronto marketplace. (I know; I have one. And I've been building them for 15 years.) But that's not deterring builders of upper end luxury homes.

For instance, taking a brief bicycle ride down my street, then through the woods and up the hill to Country Lane (south-east of Bayview and York Mills) I came across K.P. Isenberg's four-home subdivision under way on a rezoned parcel of land so new it's not in the Province's major on-line land search service. Isenberg paid a whopping C$7.550 million to the last of a series of numbered companies who have been hanging onto the parcel since at least the 1987 boom. I estimate the mansions now under construction need to fetch close to C$5 million each to make the venture worthwhile. (Environmentalists will be happy to note that the homes are built in a flood plain, which required filling before permission was given to build.)

But that's only a taste of things to come.

Just down the street, Lewis Steinberg, a former vice-president of the long-defunct supermarket chain Steinberg's, last year acquired five adjacent lots for C$29,158,878, for which we presume there are grander plans in mind than four mere mansions. Mid-rise luxury condos perhaps?

No word yet on what ATI Technologies Inc. founder K.Y.Ho, whose security-gated 26,000 s.f. mansion is just down the road, feels about all this pending crowding-in of wannabes on his once secluded estate.