McMansion makeunders: How the rich make homes appear modest (© Erhard Pfeiffer/Landry Design Group)

© Erhard Pfeiffer/Landry Design Group

If you think some houses look grand from the street, wait until you see what they're hiding below ground.

Swimming pools, basketball courts, rock-climbing walls, discos and home spas with treatment rooms are now hidden under houses in wealthy neighborhoods here and abroad. In some new projects, the square footage below the dwelling is larger than the house itself. (Bing: How to build a rock-climbing wall in your home)

"Subterranean has become the new normal for high-end construction because space is at such a premium," says Jesse Harrison of Harrison Design Associates in Beverly Hills, Calif.

In London, this expansion by excavation is controversial but has become so commonplace that it has spawned the terms "iceberg homes" or "billionaires basements." Many wealthy owners try to burrow down two to three stories.

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"Stringent planning restrictions mean that you can't build up, but you can build down, and developers and end users are exploiting this to the maximum," says Roarie Scarisbrick, partner in the U.K. real-estate firm PropertyVision.

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It's also beginning to happen more here in the United States, Los Angeles luxury architect Richard Landry says, as more buyers run up against planning restrictions that cap the size of dwellings. "Many cities with severe zoning restrictions exclude that [underground] square footage as part of the calculation," Landry says. "So having a big basement becomes more important for a client."

Building underground not only helps his clients cut costs by avoiding the expense of outside wall finishes, it lets them stash staff quarters underground, keeping more of their views and grounds for their own pleasure.

The subterranean boom
Installing underground amenities is nothing new, architects and brokers say. For decades, high-income buyers have been requesting below-grade bowling alleys or in-home cinema rooms.

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The difference these days is the huge amounts of money thrown into these underground spaces, says David Kramer, executive vice president of luxury real-estate firm Hilton & Hyland. More superwealthy international buyers in the market have meant more money for once-unimaginable builds.

"At the top of the market, getting $1,200 per square foot was considered a very big number. Now we are seeing over $2,000 as a common occurrence. In L.A., we're basically catching up with the rest of the world" and its luxury prices, Kramer says.

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British heiresses, Middle Eastern royalty and Russian oligarchs are demanding more and more amenities in their collection of homes, from underground firing ranges to dog spas to shark tanks to art galleries, which can add millions to the construction cost.

For those owning 10 or more cars, a multistory, underground parking garage with hydraulic lift is de rigueur. Where else are you going to stash so many vehicles?

Brokers say this excess is really a form of gold-plated cocooning for the world's wealthiest people, who want to entertain friends and family but don't want to stand in line at the local bar or movie theater – no matter how posh.

Canadian TV mogul David Graham has proposed a subterranean expansion in the Knightsbridge area of London that would burrow four stories below the bricks — tripling the original square footage — of the 19th-century schoolhouse above.

But all of this tunneling is creating a backlash in central London, where hundreds of huge subterranean expansions have been approved. In central London's Kensington and Chelsea borough, there's a bad case of "basement rage" from neighbors, who complain about the noise and truck traffic. The outcry has led to an independent review of planning policy in the area.

Meanwhile, in areas such as Los Angeles, the subterranean trend is just beginning to accelerate as planning restrictions have tightened. Harrison credits a 2011 city ordinance that prohibits the large, box-like additions of years past in hillside areas, while simultaneously allowing expansion if it's cut in underneath the home.

To be sure, in many areas it's just a deeply sloping lot that puts much of a home's square footage below grade. In Irving, Texas, one comparatively modest, $1.9-million golf course listing appears at first glance to comprise about 2,000 to 3,000 square feet. But glimpse that house from the back and you'll see it contains three levels with an elevator, with 3,000 square feet in one massive great room alone.

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"When you walk in, you can't believe it," says Bill Brantley, with Ebby Halliday Realtors, who has the listing. Once inside, he says, house hunters wonder, "What am I going to do with all of this space?"

Pleasure caves
Homeowners are doing just about everything with their underground space, from ballrooms to poker rooms to hair salons — even fantasy stuff such as underground pools with slides moving through a big fish tank.

These aren't the dark basement rec rooms many recall from their youth.

"You wouldn't really know you are in a basement," Landry says. "The ceilings are high, you have central light coming in, and they are decorated to the exact same level as the ground floor."

Architects bring in light via large wells and courtyards and install ramps leading down from ground level to below-grade windows or French doors. And with state-of-the-art heating and cooling systems, humidity isn't an issue.

Underground rooms have gotten so grand, in fact, that some are playing starring roles in their owner's big life events. Landry recalls a couple that used their light-filled, terra cotta-paved underground parking garage as the site for their wedding reception.

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"It was a spectacular room," Landry says, with a center aisle of 25 to 30 feet between the luxury cars for dining tables, as well as an attached sports lounge with five televisions and casino tables for gaming.

The downside to building down
Of course, not all of these expansions are successful. While well-done buildouts can return the cost of construction threefold or more, brokers say, others are more problematic.

Improper excavation can wind up costing a property owner as it jeopardizes the homes around it. According to newspaper reports in London, Goldman Sachs director Christopher Stanger's 1 million-pound ($1.52 million U.S.) underground expansion last summer pulled down the properties around it, as the foundation subsided in the initial excavation.

The sinking reportedly caused wall cracks to the property next door and trapped people in their flats because doors wouldn't open. Stanger's 160-year-old house also suffered in the process as a pillar poked through a portico on the home, requiring the removal of one part of the roof.

Landry says problems like this shouldn't happen with the proper engineering and construction methods. Done properly with the right shoring, he says, a deeper foundation can make the house more stable. 

But even Landry had to gamble with one underground build. To add space to a client's house, he was forced to lift the entire 5,000-square-foot house off its foundation by inches, while tunneling out new space and a new foundation over the course of the year. If one of Los Angeles' frequent earthquakes had hit during that time — at least one of any size — the whole project could have been in trouble.

Moreover, points out Scarisbrick, you reach a point where space no longer pays dividends. The farther you drill down, the more natural light you lose, making the space more pleasant for cars than humans. "I have seen developed houses where the space seems to be there just for the sake of it, creating an unbalanced house and no useful purpose for the space," Scarisbrick says.

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Developers, he says, usually cover up these deficits with "toys and gimmicks," he says, billing the dens as prime space for golf simulators, Pilates and meditation rooms. But it's not always convincing.

One of Kramer's Beverly Hills listings took a long time to sell, simply because the house above wasn't as grand as the extensive square footage below. "The scale above didn't match. What they really should have done is build a brand new house," he says.  

Also, brokers say, many buyers want their wealth to be on display above ground, rather than hidden below layers of pavement.

That listing in Irving, Texas, for instance, which looked so modest from the street, has lingered on the market, Brantley says, because many of the buyers wanting that much space want a more imposing facade.

"I think it has limited the potential pool of buyers," he says. "A lot of people who want a $2 million house, want it to look [from the street] like a $2 million house."