A billion dollars for an empty tract of land always sounded like a Hollywood fairytale. This week reality came crashing down on the investors, real estate agents and feuding litigants who – all too briefly – became embroiled in the greatest property story on earth.

The land in question is a 157-acre parcel perched high in the Hollywood Hills that overlooks the mansion-studded hills of Bel-Air and Los Angeles. Down the years, it has interested an eclectic mix of would-be buyers including the sister of the Shah of Iran, Merv Griffin, Brad Pitt and Tom Cruise.

Known as the Mountain, the property has been subject of furious, devilishly complex litigation pitting the heirs of Mark Hughes, the late founder of the wellness behemoth Herbalife, against an eye-catching assortment of oddballs and convicted criminals who thought, wrongly, that they were on to the deal of a lifetime.

Photograph: Matthew Momberger

When the property went on sale for a billion dollars this time last year, it was far from clear who owned it, whether the tract was eligible for sale at all, or what the purpose was of an asking price at least 10 times higher than was realistic.

One year and at least two bankruptcy proceedings later, the Mountain was auctioned off on Tuesday in a suitably low-key foreclosure proceeding held next to a fountain in decidedly unglamorous Pomona in the eastern Los Angeles suburbs. The upshot: the Hughes family trust reacquired the property for a nominal $100,000, and with it an estimated $200m in debt that has accumulated since the whole saga started.

The auction spelled the end of the road for Charles “Chip” Dickens, an Atlanta investor who borrowed $45m from the Hughes family in 2004 to try to make his fortune from the property, and for Victorino Noval and his son Victor, a pair of Cuban investors with a checkered history who promised to rescue Dickens at one point only to fail to live up to his expectations.

The land is also likely to prove costly to the Hughes trust, since the likelihood of recouping the $200m in debt it has just acquired remains remote. A regal estate not too far from the Mountain sold in July for a record $120m – but that property had a completed mansion on it.