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One Weekend in Vegas With the Nation’s Auto Dealers

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The final time the Nationwide Vehicle Sellers Affiliation was in a position to maintain its annual conference in particular person, the temper was far totally different. In a phrase, grimmer.

Simply earlier than the pandemic, pessimism abounded among the many nation’s nearly 18,000 new-car sellers. Threats loomed for the normal gross sales mannequin — for greater than a century, one of many nice turbines of localized American prosperity.

There was concern, too, in regards to the inexorable advance of electrical vehicles, with their increased worth tags and presumed decreased service wants. Autonomous vehicles portended a drop in automotive possession (and shopping for) with their promise of expanded ride-hailing and car-sharing.

Then the Covid-19 pandemic arrived in March 2020 to ship a feared closing blow. Whereas the 12 months opened with brisk showroom visitors, the underside fell out, with auto gross sales diving to an annualized fee of 8.8 million that April, roughly half the conventional clip. Sellers had been speeding to the exit doorways, seeking to offload companies which may out of the blue be value solely the worth of their underlying actual property, if that.

However the pandemic scrambled the economic system in methods huge and small, predictable and extremely erratic. Jobs vanished, however rebounded pretty rapidly. On-line retailing superior at a lightning tempo. Provide chains grew messy and inflation simply grew. And, for automotive sellers, the surprising occurred.

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Gross sales recovered quickly. And by the point the sellers gathered final month in Las Vegas for the one hundred and fifth version of their annual convention, they had been ebullient, toasting at cocktail events and stalking the conference ground. Distributors, with something a automotive supplier may wish or dream of, had been armed with sufficient promotional tchotchkes to fill a number of gymnasiums.

There was a lot to rejoice. As an alternative of imploding within the pandemic, income for carmakers and sellers alike exploded and saved hovering. Whereas some manufacturers reported decrease gross sales, transaction costs rose sharply to make up for misplaced quantity, permitting many manufacturers to notch report income, gross sales or each. And, lo and behold, automotive sellers loved their greatest 12 months in historical past.

“It’s loopy instances proper now,” stated Bruce Bendell, a founding father of the Main World and Metropolis World chains, with eight dealerships within the Bronx and Queens.

Sheldon Sandler, a Wall Avenue accountant turned automotive dealership gross sales dealer, agreed. “Each supplier in the present day is earning money hand over fist,” he stated. “Sellers are earning money with all manufacturers, even second- or third-tier ones.”

Mr. Sandler is a founder and managing accomplice at Bel Air Companions, a New Jersey consultancy that focuses on the sale of personal dealerships and dealership teams to publicly traded corporations. If he had an issue as of late, he stated, it was discovering sellers prepared to promote their shops.

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Swings within the trajectory of the pandemic can nonetheless hamper demand: After a powerful first two months of the 12 months, gross sales within the trade tumbled in March as concern of the coronavirus and stay-at-home orders saved customers from dealerships.

However vehicle gross sales in America account for near a trillion {dollars} in annual financial exercise and supply 2.3 million jobs. And the trade’s conference this 12 months, after going digital in 2021, recalled the nice outdated days, with deal-makers making offers, carmakers outlining future merchandise and plans in non-public conferences with their franchised sellers, and a staggering array of distributors promoting the whole lot from car-washing and tire-changing gear to massive outside show equipment that may hoist vehicles 25 toes off the bottom so that they is perhaps seen, revolving endlessly, from nice distances.

“Sellers are making some huge cash,” stated David Rosenberg, president of DSR Motor Group and former proprietor of Prime Automotive, one of many nation’s largest dealership teams, who in the present day owns seven New England automotive dealerships. “The common Toyota supplier within the Boston area in the perfect years made between $2 and $2.2 million. Final 12 months, the common web revenue was $6 million.”

Although not loads in absolute phrases, stimulus cash was essential, stated Steve Greenfield, chief government of Automotive Ventures, an funding advisory agency in Atlanta. The federal government help was “sufficient psychologically for folks to really feel like they may nonetheless spend by means of that,” Mr. Greenfield stated.

“Provide of each new and used vehicles was so restricted that when customers discovered a automotive, they seized upon it, and so they had been completely worth insensitive,” he continued. “The sellers parlayed that into extra revenue on the again finish, with finance and insurance coverage and extras, and, for no matter cause, customers had been so determined that after they discovered a automotive, they might pay something for it.”

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Nonetheless, as I wandered the huge flooring of the Las Vegas Conference Middle and neighboring lodge suites, there have been loads of issues. For one factor, with provides restricted and costs rising, prospects get indignant at sellers.

“If I now have 15 to twenty vehicles in inventory per dealership,” Mr. Bendell stated, “I usually have 200 to 300. These days when a truck is available in with eight vehicles, by the point they hit the cement pavement, I’m fortunate to have one left.”

His shops have even resorted to brokers. “I’m paying $2,000 over sticker worth, as a supplier within the Bronx,” he stated. “Then the automotive will get offered 30 seconds later. So we’re paying over record simply to get stock, but prospects blame the sellers for prime costs.”

Listing worth or, as it’s technically recognized, the producer’s advised retail worth is a sore spot for Jim Appleton.

“You’ve been promoting vehicles beneath M.S.R.P. for 40 years,” stated Mr. Appleton, a lawyer and president of the New Jersey Coalition of Automotive Retailers, a lobbying group. “Rapidly M.S.R.P. is that this glass ceiling that you could’t break. Nicely, your bills haven’t modified. You’ve obtained 20 % of the product you’d ordinarily get and you’ve got the identical price construction.”

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However, he stated, producers are pleased to let sellers take the blame.

“There’s X quantity of revenue within the constructing, and promoting of a car and the O.E.M.s, effectively, no one is aware of what they make on the vehicles that they promote,” Mr. Appleton continued, referring to the unique gear producers.

Mr. Appleton detects the ever-expanding affect of Wall Avenue and personal fairness corporations behind many supplier woes.

“I step again as a supplier advocate. I’m an observer, and Wall Avenue hates these guys,” he stated. “Wall Avenue hates the millionaire on Major Avenue, the automotive supplier. In New Jersey, it’s a $36-billion-a-year trade — 500 rooftops, Major Avenue companies. The income go proper again into Major Avenue causes and Major Avenue financial improvement, and Wall Avenue traders and Silicon Valley traders say: ‘What a disgrace. You understand, we must always have a chunk of that motion. Why don’t we’ve got a chunk of that motion?’”

One specific trigger for concern is the worldwide chip scarcity, which is predicted to final into 2025, retaining inventories tight. Some attendees expressed concern in regards to the push towards electrical automobiles, which require twice as many chips as fossil-fuel-burning autos.

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A extra optimistic pressure of thought on E.V.s was additionally percolating on the conference ground. Earnings from electrics are ready to be mined, stated Buddy Dearman, a Memphis-based managing accomplice for dealership apply at Dixon Hughes Goodman, a global accounting agency. “I’ve learn the place 60 % of consumers would plan on taking their E.V.s to their dealership for restore. I believe there’s a giant alternative within the service space for E.V.s.”

Sellers in the present day, Mr. Dearman stated, garner solely 30 % of the service market. “Individuals take their vehicles to Pep Boys, they go to AutoZone,” he stated. “And I don’t know that they’ll do this as a lot with E.V.s. If sellers are prepared for that, I believe they’ll capitalize.”

Larry Vellequette, a reporter for Automotive Information, a commerce publication, noticed additional alternative within the sellers’ embrace of electrical vehicles and advised that producers’ infatuation with the Tesla dealer-less gross sales mannequin could also be waning.

“They lastly found out that Tesla’s Achilles’ heel is service,” he stated. “When there’s an issue, the place do I’m going to repair it? And the way unhealthy does it look when the one approach I can get my automotive mounted is to tweet to the C.E.O.?”

One other persistent concern amongst these in attendance was the necessity to rent and retain good staff. One job in power undersupply is service technician. Meredith Collins, a director on the consulting agency Carlisle & Firm, stated demand for such employees exceeded provide by a ratio approaching 5 to 1. But, she stated, an apparent answer is at hand.

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“Lower than 1 % of service technicians are girls,” Ms. Collins stated, including that racial minorities are additionally considerably underrepresented, however to not the identical diploma.

“For years, it’s been an ignored inhabitants, simply the idea of, ‘Oh, girls simply don’t wish to be technicians,’” she stated. “So there aren’t any girls technicians, and never till not too long ago has there been lots of consideration paid to this reality.” Reflecting present company social mores, issues of variety, inclusion and fairness peppered most of the speeches and panels on the conference, even when various sellers had been spied rolling their eyes, groaning and yawning.

So long as inventories stay tight, the consensus on the present ground appeared to be, sellers will stay in good condition.

“Sellers are very apt so, when one thing occurs, we’re first to make adjustments and producers have realized they couldn’t beat it after they’ve tried to personal dealerships themselves,” Mr. Bendell stated.

Mr. Rosenberg, the longtime New England supplier, struck a observe of warning, nevertheless. “When Covid hit, lots of sellers determined that perhaps the mannequin wants to alter,” he stated. “All of us began promoting vehicles on-line, bringing vehicles to folks, doing issues that in all probability we must always have been doing for a very long time. Now that we type of have gotten over that and there’s this large shortage of merchandise, I see lots of unhealthy habits creating once more.”

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He pointed to “supplier addendum stickers,” with extremely marked-up add-ons, and sellers charging 1000’s of {dollars} over record worth.

“Usually, sellers received’t ship automobiles to somebody’s home anymore,” Mr. Rosenberg added. “It’s type of gone backwards as a result of proper now it’s a vendor’s market.”

Glenn Mercer, a longtime trade analyst with McKinsey & Firm earlier than organising his personal analysis firm, takes a extra sanguine view. “We will consider the 2 basically totally different views of contemporary automotive new-car retail in the USA,” Mr. Mercer stated. “Both the trade’s 125 years outdated and subsequently is ripe for demise, or the trade’s 125 years outdated and that’s as a result of it’s very adaptable. I’m going for the latter.”

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Scams tied to Ozempic and other new weight-loss drugs are surging. How to protect yourself

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Scams tied to Ozempic and other new weight-loss drugs are surging. How to protect yourself

Ozempic, Wegovy and other new weight-loss drugs have proved so good at helping users shed pounds, they’ve quickly become a multibillion-dollar industry.

The prescription-only medications have also been in consistently short supply, which is why they’ve grown increasingly popular — with scammers.

Online con artists are luring victims with discount offers of Ozempic and similar drugs with no prescription required. After they take the money, however, they deliver something their clients didn’t order — fake drugs, perhaps, or just the disappointment that comes when people realize they’ve been taken.

A new report by threat researchers at McAfee found 176,871 phishing emails and 449 malicious websites tied to offers of Ozempic, Wegovy and semaglutide, the generic name for these drugs, from January to April 2024. Phishing attempts were almost 200% higher during the period than they were from October to December, the internet security company reported.

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In addition, the researchers found that scammers were creating fake profiles on Facebook so they could run weight-loss-drug swindles there. Others took hundreds of fake offers to Craigslist — including 207 of them in a single day in April.

Novo Nordisk originally developed the semaglutide it dubbed Ozempic as a treatment for Type 2 diabetes, but clinicians found that semaglutide could help people lose significant amounts of weight by suppressing appetite. The Food and Drug Administration approved Novo Nordisk’s Wegovy as a weight-loss drug in 2021; since then, it has approved an alternative drug, Eli Lilly’s Zepbound, which is based on its diabetes treatment Mounjaro.

Although Ozempic costs nearly $1,000 a month without insurance, the demand for these drugs has grown rapidly. Sales of Ozempic alone are projected to reach $11 billion this year, according to one analysis.

The combination of high prices and insufficient supply has proved irresistible to scammers.

Abhishek Karnik, head of threat research at McAfee, said the fraudsters typically have two types of victims: people who can’t get a prescription for Ozempic, and people who have a prescription but can’t find it at their local pharmacies.

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The scams can be personalized and targeted at people who’ve shown some interest in weight-loss drugs, using information collected about them and their browsing habits, said Iskander Sanchez-Rola, director of privacy innovation for the internet security company Norton. The pitches may come through email or ads placed on search engines or websites, he said, including sites that are well-established and trustworthy.

“Anywhere a human can have their eyes on, they will be there,” Sanchez-Rola said of the scammers. Just because a website is legitimate, he added, that’s no guarantee that the ads there will be.

To pull off the scam, Karnik said, the fraudsters will often interact with the prospective buyer through a social media network or platform such as Telegram to win their trust. That could include offering over-the-top testimonials to their legitimacy and to the quality of the products. “You’ll have people claiming they had huge success with these drugs,” he said, “but none of it is true.”

Scam sellers may also pose as doctors or pharmacists, often from foreign countries, and claim they can sell Ozempic without having to examine you or see a prescription. That may seem sketchy, but many Americans have imported real medications such as insulin illicitly from Canada and Mexico for years because the prices are so much lower outside the U.S.

“One example on Facebook Marketplace included a ‘Doctor Melissa’ based in Canada who could provide Mounjaro and Ozempic without a prescription, with payment available through bitcoin, Zelle, Venmo and Cash App — all of which are nonstandard payment methods for prescription drugs and should be red flags for consumers,” McAfee said.

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According to McAfee, some scammers just take your money and disappear, possibly after getting you to share sensitive personal information (unwittingly, in many cases). Others will deliver an injection pen — the typical format for these weight-loss drugs — filled with something other than the advertised medication; they may be insulin injectors, EpiPens or even injectors loaded with salt water, McAfee said.

That sort of counterfeit shipment poses a significant health risk. For example, McAfee said, one person who used Ozempic to help manage her diabetes bought some injectors online after local pharmacies ran out, only to discover that the pens she received were filled with insulin. Had she not been tipped off by the flimsy packaging and different appearance, McAfee said, she could have injected herself with a fatal dose.

Another type of con, Sanchez-Rola said, is when the scammer will deliver a bottle of aspirin or some other drug you didn’t order, then make it so burdensome for you to obtain a refund that you give up.

How to detect Ozempic scams

The first rule, McAfee said, is never to buy one of these drugs without a prescription. After all, doing so is illegal in the United States.

Sticking to licensed pharmacies is wise too. You can check whether a California pharmacy is licensed at the State Board of Pharmacy website; for other states, consult the FDA’s website.

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But scammers also target people who have prescriptions they can’t fill locally, as well as offering medications they tout as nonprescription alternatives that are just as good as Ozempic. And to make their products more attractive, they may use AI tools to produce eye-popping before-and-after images that are persuasively realistic.

Here are more red flags to look for before buying a weight-loss drug online:

Strikingly deep discounts. Fraud experts say that if a price looks too good to be true, it almost certainly is. Another thing to bear in mind, Sanchez-Rola said: “You didn’t find the best deal, the best deal found you, which is already a big red flag.”

Misleading claims. McAfee warns that overly rosy promises of results are a sign of a scam. Be especially wary if the site offers none of the usual disclaimers about side effects, possible negative reactions or details about how the product should be used.

Payment methods other than credit cards. Scammers prefer systems that act more like cash, such as Zelle, Cash App or gift cards, or are untraceable, such as cryptocurrency. Sanchez-Rola said sometimes scammers will also offer a credit card option that looks real, but it’s designed to display an error message when you try to use it so you’ll be forced to use a different, sketchier payment method.

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A mix of 5-star and 1-star reviews. Sanchez-Rola said that fraudsters’ websites often try to bury the actual reviews posted by unhappy customers under a slew of bot-generated praise. If you see a lot of 5-star reviews that were posted within a short period of time, that’s a huge red flag, he said, especially if the reviews have no comments attached.

Deep discounts that expire soon. Con artists will try to override your reservations about a transaction by giving it a false sense of urgency.

Boilerplate company information. Scammers’ websites often provide phone numbers, addresses, contact information and descriptions that they copy from legitimate sites, Sanchez-Rola said. You should paste the phone number and other information into a Google search to see if they’re used by other, unrelated businesses — for example, he said, one scam site copied its physical address from an ice cream parlor, assuming that its customers wouldn’t bother to check.

Use security software that helps detect scams. McAfee and Norton, among other companies, offer programs that can alert you when you’re about to navigate to a suspicious website.

What to do if you’ve fallen for an Ozempic scam

If you’re fortunate enough to have used a credit card, you can dispute the charge and eventually obtain a refund. You can get similar results if you make your purchase using PayPal or Venmo with the buyer protection feature enabled.

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If not — for example, if you used Zelle or paid with gift cards — you can at least report the fraud to try to protect other potential victims. The federal government has an online tool to help you find the right law enforcement agency to file your report with. You can also file a complaint with the FTC’s site and the FBI’s Internet Crime Complaint Center.

Beyond that, Sanchez-Rola said, if you were conned on a social network, you should report the fraudster’s profile to the network’s administrators. For example, Facebook explains how to report fraudulent Marketplace sellers in its help section, and TikTok walks through how to report a problematic account in its support section.

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Supreme Court puts off ruling on whether state social media laws violate the 1st Amendment

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Supreme Court puts off ruling on whether state social media laws violate the 1st Amendment

The Supreme Court on Monday said it is putting off a ruling for now on whether social media laws adopted by Florida and Texas violate the 1st Amendment.

Instead, the justices sent those cases back to lower courts to consider how those laws would apply in specific situations.

Speaking for the unanimous court, Justice Elena Kagan said the lawyers for NetChoice, the group that sued the states, and the lower court judges who ruled so far made a mistake by focusing broadly on free-speech principles without considering how the laws would apply in different circumstances.

“In sum, there is much work to do below on both these cases, given the facial nature of NetChoice’s challenges. But that work must be done consistent with the 1st Amendment, which does not go on leave when social media are involved,” she said.

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All nine justices agreed with the outcome.

Monday’s decision leaves unresolved whether states may play a role in deciding what appears on popular platforms that are seen by tens of millions of viewers.

The two largest red states had passed laws to fine and punish platforms like Facebook, YouTube, Twitter (now X) and Instagram for what they said was “censoring” posts that appeal to conservatives.

The Florida and Texas laws under review arose from complaints three years ago that President Trump had been discriminated against or unfairly blocked by social media sites, including Twitter.

In 2021, Florida Gov. Ron DeSantis signed his state’s first-in-the-nation law and said it targeted the “Big Tech censors” who “discriminate in favor of the dominant Silicon Valley ideology.”

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The measure, adopted before billionaire Elon Musk purchased Twitter and changed its name to X, applies to social media sites with more than $100 million in annual revenue or more than 100 million users.

It authorizes lawsuits for damages for “unfair censorship” and large fines if a social media site “deplatforms” a candidate for office.

Texas Gov. Greg Abbott signed a somewhat broader bill a few months later, saying “conservative speech” was being threatened. It says a social media platform with more than 50 million users in the United States “may not censor … or otherwise discriminate against expression” of users based on their viewpoint.

NetChoice and the Computer & Communications Industry Assn. sued to challenge both laws on free-speech grounds, and both laws were put on hold, including by a 5-4 order from the Supreme Court.

The drive to restrict social media is heating up in many states.

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Last week, the court in a 6-3 vote threw out a lawsuit brought by Republican state attorneys that accused the Biden administration of censoring social media.

The administration said it had merely alerted sites about dangerous disinformation about vaccines and COVID-19. Justice Amy Coney Barrett said the state attorneys did not show that Facebook and other social media platforms removed postings because they were pressured to do so by the government.

Last year, the California Legislature adopted a measure to prohibit online companies from collecting and selling data on children and teenagers, but it was blocked on 1st Amendment grounds by a federal judge in San Jose.

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Why is a Monaco billionaire buying so many properties in Carmel and Big Sur?

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Why is a Monaco billionaire buying so many properties in Carmel and Big Sur?

People call it “The Pit.”

It’s a massive, unsightly hole in the ground — the site of a construction project in downtown Carmel-by-the-Sea whose previous owners ran out of money six years ago, leaving behind nothing but concrete, rebar and hard feelings.

In 2020, The Pit was purchased by Patrice Pastor, a billionaire real estate developer from the tiny European nation of Monaco, for $9 million.

Last year, he plopped down $22 million for a much prettier property: Cabin on the Rocks, the only oceanfront home ever designed by famed architect Frank Lloyd Wright.

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Jeff Becom, president of the board of the Carmel Art Assn., stands next to the construction eyesore known as “The Pit” in Carmel-by-the-Sea.

And in mid-June, he got approval from the California Coastal Commission for his “visionary plan” to restore public access at Rocky Point, a seaside property he bought for $8 million in nearby Big Sur with views of the iconic Bixby Bridge.

Pastor has been on a buying spree in and around Carmel-by-the-Sea, dropping more than $100 million on at least 18 properties over the last decade. So much so that his presence has become a source of intrigue, and for some, downright suspicion, in this moneyed one-square-mile town of 3,200 people.

Pastor bought the Hog’s Breath Building, the site of the pub once owned by actor Clint Eastwood. He bought the L’Auberge Carmel hotel, which houses a Michelin star restaurant. He snapped up the Der Ling building, a 1924 shop, done in fairytale-style architecture next to a stone pathway leading to a hidden garden.

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“When someone comes in with so much money and can use that money for influence on so many things, that’s … scary in any community,” said Dee Borsella, who owns a custom pajama shop across from The Pit. “Every person has the right to do this. But why is he picking Carmel?”

1  A visitor walks through the central courtyard of Der Ling Lane.

2 The Bingham Building on Dolores Street, reflected in a storefront window.

3 The Rocky Point Restaurant, one of the latest purchases by Monaco billionaire Patrice Pastor, rests on a bluff high above the Pacific Ocean in Big Sur.

1. A visitor walks through the central courtyard of Der Ling Lane. 2. The Bingham Building on Dolores Street, reflected in a storefront window. 3. The Rocky Point Restaurant, one of the latest purchases by Monaco billionaire Patrice Pastor, rests on a bluff high above the Pacific Ocean in Big Sur.

Pastor is the scion of a powerful real estate family that built much of mega-rich Monaco, a dense, one-square-mile nation on the French Riviera.

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He says he first came to Carmel-by-the-Sea at age 7 during a trip with his father, and that he had never seen his dad more relaxed. The memory stuck with him. He now owns multiple homes in town and visits several times a year.

“It’s not like he picked up a book one day and was like, ‘Let me find the best place to invest.’ It’s that he personally loves it here,’” said Claire Totten, a spokeswoman for Esperanza Carmel LLC, the local branch of his international real estate company.

Still, Pastor has created quite the buzz in this gracefully aging town where, according to Zillow, the typical home price is $2.2 million.

During a scuffle last summer, the city administrator took a swing at an art gallery owner who accused local officials of being xenophobic for slowing one of Pastor’s projects. And the billionaire’s local real estate portfolio burst into international headlines this year after an article by SF Gate quoted an anonymous business owner who said people were “terrified” of his intentions.

Soon afterward, Pastor showed up to a City Council meeting via Zoom and said he would “like to inform those who feel terrified by my presence” that he would be in town a few days later: “So I suggest they either take a vacation during this period or come and meet me for a relaxation class.”

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Pastor — who, according to the French newspaper Le Monde, has squabbled over lucrative development contracts with associates of Monaco’s Prince Albert II — has more humble antagonists in Carmel-by-the-Sea: the City Council, the Planning Commission and the Historic Resources Board.

The city has rejected several of his design proposals, including two for The Pit.

Development — including upgrades to private homes — is notoriously slow here. The city strictly regulates architecture to maintain the so-called village character of this woodsy place. Carmel uses no street addresses (people give their homes whimsical names instead), and has no streetlights or sidewalks in residential areas.

The stone walls of an historic home jut into the ocean like the prow of a ship.

The Mrs. Clinton Walker House is the the only oceanfront home designed by famed architect Frank Lloyd Wright.

Eastwood, who was mayor in the1980s, got involved in local politics after fighting with the City Council over what he said were unreasonable restrictions on the design of an office building he wanted to erect. Pastor now owns that building.

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Pastor “loves that it’s a bit idiosyncratic,” Totten said. “Carmel is a little bit etched in time. The world moves on, but Carmel is still Carmel.”

Pastor’s local defenders question whether he is being discriminated against because he is too rich.

“He’s had a hard time with the city,” said Karyl Hall, co-chair of the Carmel Preservation Assn. “It’s one thing after another after another. They’ve just beaten him down incredibly.”

“There’s no question that he gets more scrutiny,” said Tim Allen, a real estate agent who has handled most of Pastor’s local purchases, including the Frank Lloyd Wright residence, also known as the Mrs. Clinton Walker House.

Completed in 1952 and listed on the National Register of Historic Places, the architectural jewel had been kept within the original owner’s family until Pastor bought it in February 2023. The 1,400-square-foot house, on a rocky bluff jutting into Carmel Bay, has a hexagonal living room and stone masonry walls shaped like a ship’s prow cutting through the waves.

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In a 1945 letter to Wright, artist Della Walker wrote: “I am a woman living alone — I wish protection from the wind and privacy from the road and a house as enduring as the rocks but as transparent and charming as the waves and as delicate as a seashore. You are the only man who can do this — will you help me?”

The architect replied: “Dear Mrs. Walker: I liked your letter, brief and to the point.”

Real estate agent Tim Allen in front of the Forge in the Forest.

“There’s no question that he gets more scrutiny,” real estate agent Tim Allen says of Monaco billionaire Patrice Pastor, whose land purchases in Carmel-By-The-Sea have generated suspicion.

Allen said Pastor’s purchase includes the original furniture, because “he’s buying a piece of history” — albeit one that “needs a ton of work,” including an expensive new roof.

Last spring, Esperanza Carmel LLC, applied for a Mills Act contract for the site, a tax break for owners of historic properties who commit to restoring and preserving them. Although the City Council had approved such a contract for the home’s previous owner, some council members balked at giving the tax break — a saving of an estimated $1.5 million over 10 years — to Pastor and postponed a decision for several months.

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One resident, in a letter to the City Council, wrote: “I doubt the applicant is in financial hardship … I’m not in favor of giving handouts to ultra wealthy property owners.”

Before the council approved the tax break this spring, city officials tried to persuade Pastor to give public tours of the house and to make direct payments to local schools (which are partly funded by property taxes) — requests not made of applicants for other properties. Pastor refused.

Via Zoom, Pastor told the council he would “maintain this wonderful house in perfect condition, even if only to continue to bother those jealous people who will never have access to it.”

City officials are waging another only-in-Carmel fight with Pastor over a mixed-use development and subterranean parking garage on Dolores Street that he has been trying to build for more than three years.

Plans submitted to the city in 2021 called for the demolition of a former bank annex once used as a community room. Because it was less than 50 years old, it did not qualify as a historic structure — but after it turned 50 in October 2022, the Carmel Historic Resources Board voted to add it to the city’s historic resources list.

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Pastor agreed to build around the annex.

Then, another issue arose: The project would require the removal of a small concrete wall, decorated with exposed aggregate and inlaid rocks, built in 1972 by a man local historians dubbed the “father of stamped concrete.”

The City Council last fall said the wall was too important to be moved and sent Pastor’s company back to the drawing board.

Allen, the real estate agent, decried the delays as petty grievances. Pastor’s proposed developments, he said, will add apartments, parking and public restrooms — all of which are sorely needed.

A visitor makes his way through a narrow outdoor passageway.

Carmel-by-the-Sea relies on the tourists drawn to its cottages, courtyards and secret passageways.

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A pedestrian is caught in a reflection of a storefront window.

Carmel-by-the-Sea strictly regulates development to maintain its village character. The city uses no street addresses. Instead, people give their homes whimsical names.

“He doesn’t just buy to terrorize people,” Allen said. “He buys because it’s a good investment.”

Mayor Dave Potter said it is tough for anybody to build here and that Pastor is being treated fairly.

“We pride ourselves on our uniqueness,” he said. “You don’t get to just come in and build whatever you want. We don’t care if you’re a movie star or a mega-millionaire. You have to play by the same rules everybody else does.”

Hall and Neal Kruse, co-chairs of the grassroots Carmel Preservation Assn., are adamant, if surprising, supporters of Pastor.

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They believe modern architecture — which they describe as ‘Anywhere, USA’ buildings with sterile facades and box-like structures — poses an existential threat to Carmel-by-the-Sea, which depends on tourists drawn to its cottages, courtyards and secret passageways.

Hall, a retired research psychologist, said she talks regularly with Pastor, whom she described as “so nice, so charming and so heartfelt,” and noted that he has several modern-architecture projects in the works overseas.

“He said, ‘Karyl, you’d hate them,’” she said, laughing.

Hall and Kruse started the preservation association in response to the first proposal for The Pit, a contemporary design approved by the Planning Commission for the previous owners. They called that planned edifice “the ice box.”

Hall said they were heartened by Pastor, who proposed more traditional buildings for The Pit.

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Longtime residents “remember Carmel, and we remember the sacredness of it and why people come here,” said Kruse, an architectural designer. “We’re the ones that are largely concerned about the loss of character. But Patrice played a central role in reassuring the residents that he would help that not happen.”

A woman smiles as a man unveils a sign that says Carmel Preservation Association.

Karyl Hall, left, and Neal Kruse started the Carmel Preservation Assn. Longtime residents “remember Carmel, and we remember the sacredness of it and why people come here,” Kruse says.

Over more than two years, the Planning Commission rejected two Esperanza Carmel designs for The Pit before approving a third last August for a mixed-use project with apartments, stores and an underground parking garage. Construction has not yet begun.

The 91-year home of the Carmel Art Assn. — of which surrealist painter Salvador Dali was a member — is next door to The Pit. The demolition of two buildings there, which started in 2017, caused the art gallery to shift so much that it damaged its new roof, which started “leaking all over the place,” said Jeff Becom, president of the art association’s board.

“It’s on a sand dune. You dig a big hole and you vibrate it for several weeks, it starts to slip,” Becom said. “It’s an important place, and we didn’t want it to fall into The Pit.”

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With Pastor’s plans, “I have much more hope than I’ve had for some time,” he said.

Across the street, Borsella, owner of the sleepwear shop Ruffle Me to Sleep, is more dubious. She keeps prints of the architectural designs tucked under colorful tissue paper because customers ask her about The Pit every day.

A woman holds up a proposed architectural design.

Dee Borsella, owner of Ruffle Me to Sleep, says Patrice Pastor seems to be on a charm offensive “to ease the collective opinion that somebody’s invading our property, our town.”

Borsella, who used to work in one of the now-demolished buildings, thinks Pastor’s planned complex is too big. She doesn’t like its mezzanine. And she does not think the city should compromise its building standards just because people are sick of looking at a hole in the ground.

Pastor, she said, seems to be on a charm offensive “to ease the collective opinion that somebody’s invading our property, our town.” A few weeks ago,he stopped in her shop to introduce himself.

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“I’m a bit of a lion,” she said. “I knew he was kind of trying to come over and pet me. I felt like he was trying to win me over.”

In 2021, Pastor bought another coastal gem in Big Sur, about 10 miles south of Carmel-by-the-Sea: a 2.5-acre cliffside parcel off Highway 1 occupied by the closed Rocky Point Restaurant.

Pastor inherited a slew of issues with the land, including investigations by the California Coastal Commission into unpermitted development by the previous owners and the use of locked gates and “No Trespassing” signs to block access to public land.

The Coastal Commission struck a deal with Pastor to clear the violations and potential fines if he restores the poison oak-covered bluffs and trails and removes the gates. Pastor also agreed to add public bathrooms, parking and electric vehicle chargers.

The deal is limited to clearing the violations — not the redevelopment or reopening of the restaurant.

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A man stands on a rock outcropping overlooking the ocean.

Jeff Davisson takes in the view from a bluff on Rocky Point in Big Sur.

On a recent blue-sky Monday, Jay Davisson, chief executive of a Carmel-by-the-Sea luxury home-building firm, led family members visiting from Detroit and Tampa, Fla., to a bluff top on the property where they could see the Bixby Bridge.

Davisson, who recently moved to Carmel from Atlanta, said he considered buying Rocky Point, but it was “a little too expensive.” He loves Pastor’s plans to restore access — and has been closely following the news and scuttlebutt about his other purchases.

In such a small town, he said, “everybody talks. But I like the fact that it’s growing.”

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