Bice: Eric Hovde transferred $2.3 million D.C. house to his brother in August
Madison multimillionaire Eric Hovde had a few things he had to get done before jumping in the race against Democratic Sen. Tammy Baldwin.
Get his business affairs in order.
2. Hire a campaign team.
3. Dump his house in Washington, D.C.
Real estate records show that Hovde, 59, and his wife, Sharon, transferred ownership of a $2.3 million home on the northwest side of the nation's capital to a trust headed by Hovde's brother and longtime business partner Steven Hovde in August.
A spokesman for Eric Hovde, a Republican, said the beneficiaries of the trust are his two daughters. Hovde and his wife had purchased the house six years earlier.
The move to transfer the property came three months after the Journal Sentinel reported that Hovde and his wife had paid nearly $7 million in 2018 to buy a luxurious hillside estate in Laguna Beach, California — more than three times what Hovde paid for his Madison house on Lake Mendota. Hovde, a banker and real estate mogul, leads financial institutions in Wisconsin and California.
He is expected to announce Tuesday that he is getting in the race to challenge Baldwin this fall. He ran unsuccessfully in the 2012 for the GOP nomination for the U.S. Senate, being edged out by former Gov. Tommy Thompson.
Ben Voelkel, a spokesman for Hovde's campaign, said the decision to transfer ownership of the D.C. home had nothing to do with the upcoming race.
Instead, Voelkel said, the family realized a couple of years ago that an attorney mistakenly put ownership of the D.C. house in trusts held by Hovde and his wife's names and not in his brother's. For 20 years, Steven Hovde has headed the two main trusts set up for the two daughters. The family fixed the mistake and filed the paperwork six months ago.
"In summary, Eric doesn't own the home," Voelkel said. "He doesn't live in the home."
Democrats, however, were dubious about this explanation.
Arik Wolk, a spokesman for the Wisconsin Democratic Party, said Hovde always seems to be buying and selling properties around the time he is deciding whether to run for U.S. Senate from Wisconsin.
"As a California bank owner who's spent his career living and working out of state, Eric Hovde has a long record of putting the ultra-wealthy, like himself, ahead of middle-class Wisconsinites," Wolk said.
Hovde moved to Madison area in 2011, shortly before first Senate bid
Throughout his 2012 campaign, Hovde was dogged by charges that he was a carpetbagger, accused by his opponents of having moved to Wisconsin only so he could win a Senate seat. He dismissed the charge.
Between 1987 and 2011, he and his wife resided in Washington, D.C. But in October 2011, the couple paid $1.75 million for a house on Lake Mendota in the village of Shorewood Hills. They continue to live and pay taxes on that residence.
At the time of the purchase, Hovde — a University of Wisconsin graduate — said a possible political run "was a factor" but only one of many in his decision to return to Wisconsin.
In December 2012, just months after losing the Wisconsin primary, Hovde purchased a 10,000-square-foot, Mediterranean-style house in the Kent neighborhood of Washington, D.C. The house had 10 bathrooms, seven bedrooms, four fireplaces and a detached art studio.
Hovde weighed whether to make a second bid for Baldwin's seat but decided against it in April 2018.
Three months later, the government of Nepal bought Hovde's D.C. house for $6.8 million, making it one of the largest Washington, D.C., real estate transactions in 2018, according to the Washington Post.
Hovde and his wife bought a new D.C. residence in 2018 for family purposes
A month later, Hovde and his wife bought a new D.C. home, paying a little more than $2.3 million for the place on the city's northwest side. It currently is valued at $2.8 million by Redfin.
Voelkel said Hovde and his wife initially purchased the property because her elderly parents lived in the area, and she needed to provide care and attention to them. One of their daughters also lived nearby and was starting a family.
"The property was a place largely for Sharon to stay when she visited and helped care for her parents (her father has subsequently passed) and to visit their daughter," Voelkel wrote in an email.
The daughter and her husband lived in the D.C. residence for a while in 2021, Voelkel said, after they sold their house in Bethesda, Maryland, and before moving into their new house in Chevy Chase, Maryland, later that year. It was around this time that the decision was made to put ownership of the D.C. home in a trust.
In May 2022, Eric and Sharon Hovde each set up a separate qualified personal residence trust that owned half the house. These trusts allow the owners to hold onto a piece of property for a certain length of time before turning it over to beneficiaries with reduced gift and estate taxes.
Not long after setting up the trusts, Voelkel said, the family realized the attorney had made a mistake. The trustee should have been Steven Hovde. It took some time to sort out the paperwork. Throughout this period, Voelkel said, Eric Hovde paid the property taxes on the home but was later reimbursed by the trust.
"Steven was supposed to be the trustee of the trust all along, as is the case with two main trusts associated with the Hovde daughters," Voelkel said. Eric Hovde now has no ownership in the house.
Hovde said his real estate holdings are not an issue
In an email exchange, Hovde said his past real estate holdings in the nation's capital are not an issue in the race. Hovde didn't mention it, but it should be noted that Baldwin bought a $1.3 million rooftop condo in D.C. in 2021 with the financial help of her partner Maria Brisbane.
"Other than visiting my family, I spend very limited time in D.C. since I moved or transferred my businesses there in 2012 and 2013 to Madison," Hovde said. "I live and pay my taxes in Wisconsin which you know."
Records show that Hovde informed D.C. election officials to take him off the voter rolls in Aug. 14, 2019, because he no longer lived in the city. He has cast his ballot in Wisconsin for years but has a spotty voting record.
He then suggested that I was bringing up all this because I lost a bet with him on election night in August 2012. As I recall, I stopped by his non-victory party, and the two of us chatted. I asked how soon before his Madison-area home went on the market. He said he would bet me lunch that he wasn't leaving.
I liked my odds, so I agreed.
Nearly a dozen years later, Hovde still owns his place in Shorewood Hills.
"Maybe you are trying to get out of the bet you lost to me," Hovde wrote recently.
Clearly, it's time to pay up. Let's hope the banker isn't charging interest.
Contact Daniel Bice at (414) 313-6684 or dbice@jrn.com. Follow him on X at @DanielBice or on Facebook at fb.me/daniel.bice.
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This article originally appeared on Milwaukee Journal Sentinel: Eric Hovde transferred $2.3 million D.C. house to his brother
