His wife had scoped out what she called their perfect house.
Built in 1932, the 3.3-acre estate has a total of 12 bedrooms and 14,000 square feet of space. It also has a 72-foot-long pool.
The home, known as the Villa Ruchello, previously belonged to noted director Henry Jaglom. It has made appearances in "Beverly Hills Cop" and "Entourage."
But when Smith bought it, it needed a bit of work.
"No one had really been taking care of the house for 15 years or so," Smith's wife Tamyka tells the Journal. "The owners had gotten a divorce and were renting it out. We had to replace all the plumbing, all the electrical, the roof and do the whole thing." Tamyka was in charge of restoration work that the Journal says featured "handblown glass chandeliers from Venice, a geometric orb bar custom made by MJ Atelier, antique Persian rugs and various vintage French and Italian furnishings."
The house is worth only a small fraction of Smith's fortune, which the Journal says could be around $1 billion. Smith also owns a $3.8 million home in the Pacific Palisades neighborhood of Los Angeles.
Here's a look at how the Villa Ruchello was when Smith bought it: