All of us are star struck when we come across the super rich, famous, talented. We want to know where the A-listers live, where and what they eat, what they wear if only to “…get a glimpse of the glitz and glamour…” for a moment or two, said Angel Kou, a real estate marketing whiz with The Agency. “Here in Los Angeles, the foreign buyers are the ones most drawn to celebrities…they want to know where they (celebrities) live.”
When it comes down to brass tacks in real estate, however, does celebrity presence translate into increased sales prices and shorter sales timelines? The answer, as with all things in real estate, it depends.
The “celebrity effect,” sometimes called the “halo effect,” seems to have only a small impact on property sales when the celebrity “…used to live there…” according to Tom Postilio and Mickey Conlon with Daniel Elliman’s Manhattan office. “Sometimes people catch little snippets about a particular property…and it (celebrity history) creates some cache…some urgency to move quickly on the property…before someone else does because now, everyone else has equal access to this (celebrity) information too,” said Postilio. On the other hand, according to Rick Pretsfelder, partner with New York’s Leslie J. Garfield and Company, usually the celebrity effect makes no difference because “…(these celebrities) all have non-disclosure agreements…and the more well known the person is, the more likely she or he will expect discretion.”
Celebrity endorsements of specific properties do bring press visibility, exclusivity and sex appeal but celebrity endorsements tend not to impact the property sale. Postilio said, “I don’t think anybody cares to pay more because of a celebrity connection…unless, of course, the celebrity is included in the sale.”
The same tends to be true when celebrities are used to position property brands. Gil Dezer, president of Miami-based Dezer Development, said that celebrity positioning isn’t really meant to promote sales. “Our goal is to give back to our owners, the developers and investors…,” said Dezer. “We’re dealing with wealthy people who aren’t necessarily star struck…people who are used to having celebrities…” wandering around.
A real impact happens when celebrities are currently living in a particular property or neighborhood…other celebrities tend to be attracted to that same property or neighborhood. Take a converted warehouse in Tribeca, encouraged Pretsfelder. “Jake Gyllenhaal, Justin Timberlake, Jessica Biel, Jennifer Lawrence, Harry Styles, Ryan Reynolds and Blake Lively…” all live there. Positilio said that “…all you need to have is the cash and the Oscar or Emmy to gain admission to that club.”
Specific blocks in Manhattan such as E. 10th Street or Greenwich Village between 5th Ave. and University Place can, in fact, impact a neighborhood’s profile and contribute to increased prices, according to the Leslie J. Garfield NYC Townhouse Report. “Those blocks sell at double digit premiums compared to other areas…it gives the neighborhood credibility and tells other buyers that this must be a nice place to live…” said Pretsfelder.
Sometimes, all it takes is just spotting an A-lister looking at or rumored to be moving into a property or neighborhood. Conlon of Elliman said, “People may think, ‘if they’re looking there, why aren’t I looking there too?'” Pretsfelder, however, said, “Buyer beware…sometimes those celebrity tales aren’t true. Using celebrity names is just another way of marketing…just another effective way of increasing interest.”