By Pete Finch
Billy Walters is about to make a multimillion-dollar bet involving his home in Rancho Santa Fe, Calif.
In case the name doesn't sound familiar, Walters is the professional gambler and Las Vegas golf course owner who was linked to Phil Mickelson and billionaire investor Carl Icahn in that insider-trading probe earlier this year. All three have denied any wrongdoing.
On Aug. 15, Walters is auctioning his 21,000-square-foot home at 5425 Los Mirlitos in Rancho Santa Fe, an exclusive area north of San Diego. The place sits on nine acres and comes complete with a Dave Pelz-designed short-game practice area.
What makes it a gamble: Walters has agreed to sell his place to the highest bidder, "without reserve." In other words, there's no bottom price. He listed it earlier with a traditional real estate firm for $20 million. If the highest bid on Aug. 15 is, say, a tenth of that, the buyer gets it for $2 million.
"I'm not concerned that's going to happen," says Walters, who teamed with Fredrik Jacobson to win the AT&T Pebble Beach Pro-Am in 2008. "I paid $8.5 million for it three and a half years ago, right in the crunch of the recession. My wife, Susan, and I spent a little over $7 million in hard costs completely renovating it, with her doing all the work. This is probably the nicest house in the whole San Diego area."
New York-based Concierge Auctions will handle the sale. Its president, Laura Brady, assures a crazy low-ball bid won't win. She expects there'll be five to 10 serious, qualified bidders who will pay a fair price for the house. The firm is on track to sell about 70 homes at auction this year, most of them "no reserve" deals like this one.
Interested bidders need to be pre-qualified and will have to deposit $500,000 with Concierge Auctions by 5 p.m. on Aug. 13, says Brady.
The Mirlitos place -- less than a mile from a Mickelson home, incidentally -- is one of two Walters owns in the area. The other is an 11,000-square-foot home right on the water in Carlsbad. Walters tried to sell it three years ago for $29 million but took it off the market. He and Susan have decided to live there and sell the Rancho Santa Fe property, he says.
"We've lost money on every home we've bought and sold here," Walters told the Wall Street Journal in 2012. "It's not what I do for a living. If it was, I'd be in trouble."
Is that still true? I ask.
"I sold one in Los Cabos, at El Dorado," says Walters, whose Vegas courses include Bali Hai, Royal Links and Desert Pines. "I made a little money. But other than that, it's still 100 percent true."
Here's a guy who claims he's never had a losing year as a professional gambler. How can he be such a consistent money-loser on real estate? "My wife spends too much money on these things," Walters explains. "We're not doing it with return-on-investment as our motivation. She wants to furnish them in the best way possible. You can furnish a home for $50 a square foot or $110 a foot, and she's going high end. When you buy from us, you'll get the best furnishings you can buy. But that's why we haven't made money."
And what of the insider trading probe? Anything new to report? "I have no comment on that," says Walters. "No comment."