Robert Knutson, a founder and the retired chairman and chief executive officer of the Education Management Corp., took his company public in 1996. A decade later, it was acquired for $3.4 billion by a consortium of private equity firms led by Goldman Sachs Group Inc. In 2009, the company went public again, this time with a valuation of about $2 billion. (It’s since been reacquired. A 2010 Bloomberg article reported that Knutson had made $132.4 million in stock sales from his company.)

In the meantime, Knutson was busy buying houses with his wife Miryam.

“Over the years, we [acquired] a lot of residential properties,” he says. “One in western Pennsylvania, one in Durango, Colo., and one in Boca Grande, Fla.”

In 2004, they added to their portfolio a dilapidated historic mansion set on 11.3 acres, a four-minute drive from downtown Santa Fe, N.M., which they say they purchased for about $3.5 million.

Restoring the House
“It was built in the 1930s for John Dempsey, who later became the governor of New Mexico,” says Miryam Knutson.

Dempsey sold it to an heir of the Weyerhaeuser timber fortune. The house then passed through two owners until it was purchased by yet another heiress, a member of the family that had founded the Italian beverage company Martini & Rossi. She, Knutson says, was lax at maintaining the home.

When the Knutsons visited, Miryam thought it would take years to restore. “But my husband said ‘Oh no, it will just take a year.’”

Ultimately, it took four years—and, the couple says, an additional $18 million. “We got the best architect who specialized in Pueblo Revival houses and then got curators to work with us to restore the house to perfection,” Miryam continues. “There are 64 kinds of windows in the house, and every single one is different and had to be special-ordered.”

They redid the roof, walls, plumbing, electricity, and security system, plus heating, ventilation, and air conditioning. They also restored the interior wood ceilings and finishes, rebuilt the fireplaces, and then set to making exterior improvements. “We built magnificent stone walls across the property,” she says. “And we hired somebody to trim every tree on the property for three years.”

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