This REO is a Doozie: Talk About Strategic Default, the Former Homeowner Even Went to West Point – Dallas Real Estate News

Published September 22, 2011 by Candy Evans

Not totally local Dallas Real Estate news, but the house IS on Mockingbird Lane — in Paradise Valley, Arizona. Paradise Valley is like the Highland Park — no wait, make that Vaquero — of Phoenix.  Paradise Valley is in Maricopa County, home to twelve resorts, and one of Arizona’s top tourist destinations. Very pricey dirt: the median home price is about $2.74,  many homes exceeding $10 million, some over $40 million. So when there is a foreclosure there, people drop their fingernail files.

And this one is a doozie. This sumptuous five acre estate at 5636 East Mockingbird Lane would be perfect for a man with, say, multiple wives. Or girlfriends. It has seven bedrooms, ten baths, for a total of 35,000 sq.ft. under roof, but relax: only 25,000 square feet needs to be cooled or heated. (Can you FATHOM the A/C bill?) Only two years old. Incredible amenities include flooring of six foot marble slabs (as opposed to 12 by 12 or 18 by 18 tiles, like the rest of us peons have) from Italy. The library has $350,000 Pierre Lang mahogany cabinetry, $1,200,000 Avia high tech security & sound equipment. There is a 13 seat mahogany theatre with movie projection and those D-box chairs that move with the movie action — I saw those at Robb & Stucky back in 2006 and wondered who the hell would buy them. The marble in this house must have cost a least a couple million to ship: the luxurious master suite has a bathroom with six foot onyx slabs and the boutique closets are so built out they resemble a Fifth Avenue department store.  There is a two-bedroom guest house of nearly 2,000 square feet, his and her’s libraries, his and her dressing rooms.  Oh, I can’t forget the $1.2 million security and sound system and its own solar electric generating station. Oh and not one, but TWO swimming pools, including a solar heated lap pool for frosty days. Did I tell you about the 21 car garage that would be Jay Leno’s dream? It has $400,000 finish-out — reminds me of former Dallas City Coucilman Mitchell Razansky’s garage on steroids: rubberized colored floor tiles, lights, lighted gas pumps. Of course there is also a billiard room, wine room, piano room, three family rooms — maybe one for each wife or girlfriend? Exercise room (only one, sorry), two libraries , a 2,000 square foot two bedroom guest house, outdoor marble walkways because cement is not fancy enough, and in case this home sucks all of the energy out of Maricopa County, it has it’s own solar electric generating station.

Goes without saying: lovely mountain views with ultimate security. Owned by M&I Bank, started at $17,900,000, now an REO for $15,995,000.

You know me, I just had to know more about this property. My first thought was that someone from like Bahrain had built it then fled the country. But no, no one from the Middle East built this palace. I had to dig and bug my realtor friends in Phoenix and said, hey, who owns this? Turns out he is an All-American guy who went to West Point. (I’ll bet, not sure, but will bet he even played football.) And me thinks this is a strategic foreclosure. Which is really a business decision, I understand. And don’t tell me this is what brought down the housing market: multi-million dollar foreclosures are a very small piece of the market crash. More than 80% of the homes in foreclosure in Dallas County, for example, are $200,000 homes or less, and the story is not much different elsewhere. But I still think this is a fascinating foreclosure story.

So this home was built in 2009 by Cal Christiansen, big time home builder in the Phoenix area. The owners are listed as Phillips and Patricia Smith. Dr. Phillips Smith has been, since January, the Chairman of Lightwave Logic, which does something with high speed fiber-optic telecommunications and optical computing. Dr. Smith is actually brilliant, and has an amazing background in lasers and such. From the company press release: 

“Dr. Smith has over 35 years of experience with high technology companies serving as both chief executive officer and chairman, and in corporate officer positions at three Fortune 500 Companies.  In 2001, Dr. Smith brought TASER International, Inc. public through an IPO and most recently served as Chairman of TASER International, Inc. (Nasdaq: TASR) until his retirement from that position in December 2004. Dr. Smith subsequently resigned his TASER board seat in October 2006.  Since then, Dr. Smith has been actively involved as an investor in start-up companies.”

TASER — those guns all the police use to zap criminals and tame the populace. This guy was Chairman of TASER and his home was foreclosed!

Previously, he was Chairman and CEO of CAE Systems (sold to Tektronix Inc. for $75M in 1986), CEO and Chairman of EDGE Computer and CEO and Chairman of ZYCAD, a public company on NASDAQ.

Dr. Smith received his B.S. degree from West Point, an M.B.A. from Michigan State University and a PhD from St. Louis University.”

You can see where he has been able to finance his taste in big homes. What the heck happened with 5636 East Mockingbird Lane? It’s located on Mummy Mountain for God’s sake.

My theories:

1. The house is haunted.

2. The two owners got carried away, like when they brought in that Elvis statute in the theater office. (And TWO pools? 21 car garage? What is this, the next Concours D’Elegance?) They decided the house is too big, too muddled: a strategic default over bad aesthetics?

3. With all the rooms they built, they forgot the most vital: a room to play laser tag.

Like my friend Tom says, it appears the true hardship facing the previous owners of this bank owned beauty is deciding on Brazilian hardwood or Italian marble for their new digs.  My suggestion: bamboo. And who needs marble sidewalks?

— Daily Local Real Estate Dish By Dallas Real Estate Insider — Candy Evans at CandysDirt.com