Inside the Fight Over L.A.’s $190 Million Megamansion, A Widow vs. a Banker’s Dream

04 December 2025

The Winnicks purchased Casa Encantada for $94 million in 2000. Simon Berlyn

In one of the most dramatic real-estate dramas unfolding in Los Angeles this year, a 79-year-old widow is battling to keep hold of what was once America’s crown-jewel mansion, a sprawling estate now headed for auction. The 60-room home, known as Casa Encantada, has been valued at roughly $190 million and is set to go under the hammer after her family allegedly fell behind on a massive loan.

The widow, Karen Winnick, took ownership of the property after the 2023 death of her husband, entrepreneur Gary Winnick. In court filings this week, Karen and her son argue they were blindsided by a “loan-to-own” scheme disguised as financing, a loan that ballooned far beyond what they believed they signed up for.

The controversy traces back to a $100 million loan secured in 2020 from developer and real-estate investment firm CIM Group. The loan was reportedly secured by Casa Encantada and a Malibu property owned by the couple’s sons. According to the family’s legal team, Gary Winnick lacked understanding of the loan’s terms. They claim Karen only saw what appeared to be standalone signature pages. As the mortgage payments reportedly stalled, interest and penalties allegedly pushed the balance far beyond $155 million.

CIM Group responded by filing a notice of sale in September. The firm insists the deal was legally binding, that Karen and her husband were represented by counsel, and that they were aware of the full terms. The firm, through its real-estate credit arm now insists it has the right to auction off the mansion and the Malibu property. The proposed auction date is December 16.

What’s at stake goes beyond the loss of a home. Casa Encantada is a storied piece of Los Angeles history. Built in the 1930s, the 40,000-square-foot estate has been home to moguls, Hollywood legends, and royalty of wealth and influence. The mansion was famously purchased by Gary Winnick for $94 million in 2000. He later commissioned a lavish restoration with celebrity designer Peter Marino at the helm. Inside, the home features towering ceilings, luxe finishes, hand-lacquered walls, a walnut-paneled library, a grand dining room, multiple luxurious bedrooms, tennis pavilions, a sweeping pool and sweeping views of the Bel Air Country Club.

In their cross-complaint filed in Los Angeles Superior Court, Karen and her son allege the loan was part of a scheme intended to seize the property once the debt burden became insurmountable, calling it financial elder abuse. They argue the structure and speed of the loan, combined with aggressive interest terms and concealed risks, amounted to predatory lending.

For Karen, the loss would be devastating not just of bricks and mortar, but of a life’s worth of memories, possessions, and security. The loan was reportedly backed by more than just real estate: antiques, antiques, jewelry, art, furniture, and family heirlooms were pledged as collateral, meaning what is at stake is more than just the building itself.

CIM Group, however, is standing firm. In court documents they described their dealings as lawful and transparent. They say that the Winnicks had legal representation, signed the documents willingly, and several times were offered “workout” solutions or refinancing to avoid default. According to their filings, the family’s public appeal is simply an attempt to rewrite history after failing to uphold their end of the agreement.

The upcoming auction looms large. If Casa Encantada sells, it will likely go to a buyer possessing not just deep pockets, but the ability to defend such a purchase rendering even glitzy celebrity bids potentially less competitive. For the Winnicks, the legal fight represents perhaps their last chance to block the sale.

Beyond the courtroom, the standoff throws into sharp relief the precarious relationship between personal wealth, financial instruments, and legacy. A home once secure in fortune may now be lost to financial engineering and leverage, a cautionary tale for the ultra-wealthy, perhaps, but also a human story of vulnerability, trust, and the meaning of home.

Whether the sale goes through or not, this chapter in the life of Casa Encantada lays bare how even historic estates symbols of power and status are not immune to the harsh arithmetic of debt, contracts, and timing. At stake isn’t just a mansion, it’s history, memory, and a family’s claim to identity.