Lowered Expectations

NEWPORT BEACH â€”  The most expensive home ever sold in Orange County--a Newport Beach waterfront estate with breathtaking views and rich neighbors--has been bought for about 60% of its record sales price, brokers said.

William G. Simon, former head of the FBI in Los Angeles, and his wife, Alice, paid about $8 million for the mansion, which sits on the tip of exclusive Harbor Island and features 46 sets of French doors, an elevator, 11 1/2-foot ceilings, seven bedrooms, nine bathrooms, six fireplaces and an eight-car garage.

Reclusive Hong Kong businessman George Yao bought the mansion in 1991 for $13.8 million--a county record. But a bank foreclosed on the property last June as Yao encountered financial difficulties, and the title was transferred to an investor group.

Like many luxury homes in Southern California, the Newport Beach estate lost value during the real estate slump. But the reduced prices and low mortgage rates have recently helped strengthen sales of mansions in Southern California and throughout the nation. Luxury homes that have been on the market for years are finally finding buyers.

“Clearly there’s a real renaissance in expensive homes selling,� said Bill Cote, a broker who sells luxury homes. “The Orange County market has bottomed out for luxury homes and is going back up.�

With his purchase, Simon moves into a neighborhood that includes developer George Argyros, who lives down the street. Just across Newport Bay, on Linda Isle, lives Donald Bren, chairman of the Irvine Co., Orange County’s largest landowner. Also within view of the mansion is Bayshore, John Wayne’s old estate.

The nearly 18,000-square-foot mansion--built with poured, reinforced concrete and covered with Texas limestone blocks in 1989--sits on nearly half an acre on an island with just 30 other estates.

Once part of the estate of Los Angeles banker and arts patron Howard Ahmanson, the former Yao home at 18 Harbor Island was built by local developer Leroy Carver III, whose father founded a county Rolls-Royce dealership.

Yao, a hotelier, owned the home for about five years, but didn’t live there the entire time. Last year, with his finances worsening, the bank foreclosed. Yao also surrendered control of the 289-room Radisson Plaza Hotel near John Wayne Airport. The hotel was purchased in February by EquiStar Hotel Investors of Washington and last month was renamed the Orange County Airport Hilton.

The home’s title was transferred last year to an investor group called Newport Harbor Corp., which paid $7.35 million, Cote said.

Simon, 82, joined the FBI in 1940 and took over as special agent in charge of the Los Angles area in 1960. He left in 1964 to practice law with Simon and Sheridan and became president of the Leisure World Foundation, a real estate group. Former residents of San Marino, the Simons have lived in Newport Beach for seven years.

Although the Yao house has sold, there are other pricey Orange County estates still on the market, including real estate developer James Baldwin’s Emerald Bay home near Laguna Beach for $10 million.

The most expensive Orange County mansion for sale is the $16.5-million Pacific Reflections, an 11,000-square-foot home perched on a Laguna Beach cliff. Built in 1978 by stockbroker Boyd L. Jeffries, who pleaded guilty to securities law violations in 1987, the home has granite floors, a mahogany exterior and a rotating bed under a domed ceiling that opens to the stars. The home has been on the market for more than a year. The current owner, who does not want to be named, bought the home for $8.3 million, a broker said.

George Pelton, director of special markets at Coldwell Banker in Mission Viejo, said interest on Pacific Reflections has been strong, especially among foreign buyers.

Another Orange County mansion on and off the market since 1989 is now priced for half of what was six years ago. Former Clothestime Inc. executive Mike DeAngelo’s 30,000-square-foot home in Cowan Heights is now for sale for $9.9 million, down from an original listing price of $22 million.

The 10-bedroom, 13-bath estate, which was featured on the show “Lifestyles of the Rich and Famous,� is on 26 acres. The home, which has a disco with a fog machine and a hair salon, was built in 1985 for DeAngelo and his wife, Pat.