Is billionaire Mohamed Hadid broke? What he has to say on the subject
Real estate developer Mohamed Hadid is trying his hardest to keep his “mega-mansion”, but his financial troubles seem to be catching up with him. Hadid, who you may recognize as being the father of models Gigi & Bella Hadid, is claiming he’s near-broke thanks to a series of fines, fees, & failed business ventures he’s had to pay over the past six years.
Because he claims he’s broke, Hadid is arguing he can’t pay for the demolition fee the judge ordered Hadid to pay for, since his house has caused so much trouble for the city of Los Angeles. Hadid is being sued because of his Bel Air property, which his neighbors claim is a “nightmare” to live next to, according to The Daily Mail.
Here’s a breakdown of why Mohamed Hadid claims he’s almost broke and why his neighbors believe Hadid is lying to stop his mansion from being demolished.
Hadid’s problems in court started thanks to his so-called “mega-mansion”. This extravagant property amounts to $50 million and has been under construction for six years, according to Vanity Fair. However, a few disgruntled neighbors found the house a “monstrosity”, according to The Daily Mail, and called the construction a “nightmare”.
Thanks to the long-winded construction plan, Hadid’s neighbors had enough. His neighbors, led by Joe & Bibi Horacek, decided to sue Hadid for cash damages and the construction they believe lasted far too long, according to Vanity Fair. Vanity Fair reported Hadid only received permits to build a 15,000 square feet, but has since expanded his property to 30,000, without getting the approved permits.
The city of Los Angeles told Hadid to stop building, which he reportedly ignored, leading the city to prosecute Hadid at the end of 2015. Two years later, Hadid pled no contest and was fined $3,000, paid over $14,000 to the city, and had to serve 200 hours of community service, according to Vanity Fair. He was also ordered to either demolish or reduce the size of the house within three years, but never completed the task.
Time in court
According to Vanity Fair, Hadid attempted to appeal & overturn the decision to demolish his property, but the court called the mansion a “clear & present danger” and denied Hadid’s request. Hadid claimed it was a “political lynching” and was due to “racisim” & “prejudice”, according to Vanity Fair, which the Horaceks & their lawyer, Gary Lincenberg, contested.
Now, Hadid is fighting against the demolition fee, which reportedly costs $5 million, according to The Daily Mail. Hadid claims he doesn’t have the funds to pay the fee, but the Horaceks & Lincenberg believe he’s lying. According to The Daily Mail, Lincenberg wanted the judge to hold Hadid in contempt & give penalties for “making false statements”, saying Hadid didn’t provide an accurate picture of his assets & income.
The judge presiding over the case, Los Angeles Superior Court Judge Craig Karlan, said Hadid had to provide proof of his loss of income before considering Hadid’s claims. Judge Karlan ordered Douglas Wilson, the receiver appointed to oversee the demolition, to sell the house & land to pay for the cost of the project. When Hadid’s team asked for a $50 million bond since Hadid was losing his property, the judge denied the request.
Hadid told the court, by losing his house he’s losing over $60 million, as Hadid used $30 million to buy the land & build the property and he took out a loan, costing him $20 million with interest, and owes lenders at least $7 million, according to The Daily Mail. “My reputation is tarnished and my ability to go out and borrow other money, it’s fractured at best,” Hadid said in a statement to the court.
Hadid’s statement covered the reasons why he couldn’t pay for the demolition fees, but he also believes the Horaceks’ lawsuit hurt his ability to find other forms of income to help pay for the outstanding fees. Hadid told the court, “The stigma of the project and the impact on my life over the past six years that Joe Horacek has harassed me have been personally devastating”, according to The Daily Mail.
Hadid further stated he has “no present nor presently foreseeable potential” to pay for the fees or fund the demolition. Hadid called the lawsuit a “vendetta” and also blames the media coverage also had a hand in causing his money troubles.
Losses of money?
Most of Hadid’s complaints in court involved his business failings. The Hadid family brand has been attributed to caviar & champagne products and an eyewear line attached to Bella & Gigi Hadid, which failed and resulted in nothing “other than a lot of unsold eyeglasses”, according to The Daily Mail. He also hasn’t paid a construction loan of $97 million for a residential development, costing him over $10 million in interest.
Hadid claims he’s lost so much money he’s had to “downsize his lifestyle” and move from a 48,000 square foot estate into a “modest” house, which he clarified was “purchased at no money down from an acquaintance”. He also stated he stands to lose another 70-acre project thanks to a defaulted loan, according to The Daily Mail. Hadid did list other assets he owns, including art, watches, two cars, and other personal property.
Still, the neighbor’s attorneys still claim Hadid is lying, claiming Hadid is “concealing his finances to avoid being called to task”. Despite the statement, Lincenberg argued Hadid didn’t clarify or state anything of substance, saying Hadid failed to provide any concrete number as to the size of his income.