Malibu’s $500 million ‘The Case’ mansion enclave on the brink of collapse

A hilltop enclave in Malibu once considered America’s most expensive new neighborhood is on the verge of collapse.

Four of his five homes are unsold and the developer finds himself engaged in a bitter bankruptcy battle with his financial partner.

The project, known as Case, is the work of developer Scott Gillen.

Gillen paid $50 million in 2017 for a 24-acre parcel with ocean views — then a record for undeveloped land in Malibu, the Wall Street Journal reported.

He planned five elegant homes inspired by mid-century California case study homes, priced between $40 million and $100 million each. Together, he hoped they would sell for nearly half a billion dollars.

Nearly a decade later, just one house has been sold, for $61 million in 2024, according to real estate records cited by the Journal. The other four are almost finished but still on the market.

Real estate agents who worked on the project said the developer was largely to blame.

“Ego just got in the way,” Compass agent Tracy Tutor, who worked on sales at Case in 2019, told the New York newspaper.

This summer, entities linked to Gillen filed for Chapter 11 bankruptcy.

The filings list a long list of creditors, ranging from landscapers and a security company to subcontractors. They also show outstanding loans from JPMorgan Chase and an entity linked to bridge lender Private Mortgage Fund.

The largest debt is owed to a company linked to Los Angeles developer and investor Barry Shy, Gillen’s associate. Shy’s company says it provided a $260 million promissory note for the project in 2021. Shy claims Gillen now owes him more than $240 million with interest. Gillen disputes that, saying in court papers that the unpaid principal is $89 million.

Shy has accused Gillen of mismanaging the project and wants a court-appointed receiver to take control. Gillen, in turn, accused Shy of fraud and self-dealing. He says Shy cut funding in 2025 to oust him. Gillen also claims Shy threatened to block the sale of two of the homes for $110 million to an affiliate of billionaire Don Hankey.

Agents described Gillen as a perfectionist who insisted on attending showings and introducing buyers himself, which often put them off. Tutor said that at a promotional party, guests were asked to remove their shoes and the toilets were covered with plastic wrap so no one could use them.

Agents also said ultra-wealthy buyers were reluctant to pay tens of millions of dollars for a house next door to a nearly identical house.

Josh Altman, a former star of “Million Dollar Listing Los Angeles,” said the prices were unrealistic from the start. “He could have sold (the houses) 10 times over for a reasonable price,” Altman said.

Gillen refused to move. “We are not going to adjust our prices,” he declared to the Journal in 2023.

The broader Malibu market has also weakened since the Palisades fire in early 2025.

As of mid-October, 160 Malibu homes had been reduced below their original asking prices, with a median reduction of 8.9 percent, according to the website Luxury Price Drops.

The Journal also reported a previously unreported murder charge in 1987 against Gillen, who then went by the name Scott Ashley. He was ultimately convicted of the lesser offense of complicity to a felony and placed on felony probation.

Gillen remains defiant.

In an Instagram post last month, he vowed to never give up and said the project was almost complete.

“Whatever you do, you fight the fight and you never stop and you never give up,” he wrote. “I remember when I bought this land, these lizards and snakes, that’s what I got. Look at it now, I can say that yes, I did that. We’re almost there again. Have a fantastic day.”

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