Jack and Laura Sommer’s house is pretty unusual.
Its finishing touches include marble from China, Iceland and Brazil. It has a full basement, plus staff quarters with Jacuzzis and a secret garden. Its 25,000 square feet of space has 39 air-conditioning zones fed from a 120-ton cooling tower. The library shelves are made of stainless steel and clad in American cherry wood. From the owner’s suite, you can see five
fairways on the Spanish Trail Country Club’s golf course, and Anna Nicole Smith shot a movie in the 2,000-square-foot guest house. Listed at $7.85 million, it’s definitely an outlier, at more than 4,000 percent of the median local sales price for a single-family home.
“This house was an exercise in how many cool details we could put in,” Jack Sommer said on a recent tour.
But those details may not even be the most noteworthy things about the home.
What really stands out is that Sommer, a commercial developer who once owned the Aladdin (now Planet Hollywood Resort) on the Strip, will accept his cool millions in bitcoin, a burgeoning digital currency.
It’s the first local home to be marketed formally around bitcoin, as far as we and Sommer’s sales agent, Craig Tann of Prudential American Group’s Estates of Las Vegas team, can tell. It’s also likely the most expensive home marketed anywhere with the currency, which is in the news thanks to its surging value and popularity.
“I think it would definitely be the largest real estate transaction done in bitcoins that I’ve heard of,” said Julian Tosh, a bitcoin-merchant consultant and owner of bitcoinsinvegas.com, a website that connects bitcoin users with stores that accept the currency.
Sommer said he got the idea to market his mansion via bitcoin from two of his sons, who’ve been involved in everything from mining, or making, bitcoins to stockpiling and trading the currency. They’ve used bitcoin to buy computers, software and other equipment, so why not try a big real estate deal with it?
“The advantage is that we’re expanding our market and adding some notoriety,” said Sommer, who’s looking to downsize now that his seven kids are grown and have moved out.
Tosh agreed that bitcoin could open Sommer’s home to a global audience.
“There are a bunch of people who have bitcoins, and they’re dying for a place to spend it,” he said. “If you increase awareness of potential buyers, you could tap into new markets.”
Bitcoins are also ideal for streamlining international business deals, Tosh said. To use bitcoins, you buy them through an exchange website with a mainstream paper currency, such as dollars. You keep an online ledger tracking your bitcoins, and transfer them digitally to use them. So a Frenchman can use euros to stockpile bitcoins, and send the bitcoins directly to an American’s account without worrying about converting to dollars.
Bitcoins have been around since 2009. Users swear by them because they don’t require bank accounts and they’re not government-regulated. Because there’ll be a finite number of bitcoins “minted,” users don’t have to worry about inflation.
But 2013 has proven the currency’s golden year. Tosh credited intensifying news coverage for bitcoin’s recent fortunes. Businesses ranging from dental practices to firearms schools accept them. A California Lamborghini dealership just sold a $103,000 Tesla to a Florida man for 91.4 bitcoins. A Canadian man has listed his Alberta home for the bitcoin equivalent of $405,000. The currency hit a watermark when Bank of America Merrill Lynch said earlier this month that one bitcoin could have a maximum value of $1,300 — more than the price of an ounce of gold.
Today, a bitcoin is valued at about $870, up from $10 in January. There was even a convention, Inside Bitcoins, at the MGM Grand on Tuesday and Wednesday.
Still, there are risks to doing a $7.85 million real estate deal in bitcoin.
“Bitcoin is risky, that’s for sure. The volatility is pretty extreme,” Tosh said. “Locking in a price for such a large transaction is going to be kind of difficult. If the value is changing 30 percent a day, how do you quantify that in a contract and expect each side to hold on for 30 to 90 days while escrow clears?”
But Sommer said he believes it’s better to be flexible in how he takes payment, especially because it would be “very surprising” if the home’s buyer was local, or even from the United States.
Tann agreed that the property, which he called “more of a traditional European property” given its layout, would be a likelier draw for an international buyer, particularly one with a full staff including a chauffeur, a chef and a nanny.