Luxury Renovation: 70% rule?

[Heath Clendenning]

I have enjoyed reading hundreds of posts here and on other forums over the past couple of months. There is a lot of experience and I am pleased to see, a lot of transparency. 

I live in Los Angeles and have private investors who will join me in an equity split of properties we plan on rehabbing. 

While I have an above average understanding of construction costs (as I have worked in this industry before) I am curious to the threshold percentage - A.K.A the "70%" rule - for luxury real estate. 

Real life scenario: 

There are multiple 2 br single-story homes in a particular area of LA going to $1.5-$1.8 million. On the same or nearby streets, are $3.2-$4.1 million dollar homes, many newer construction. 

I'm very interested in a project here and would even consider expanding any potential investment 'out and up' to gain sq. foot space, views and of course value. 

Should I hold fast this rule of 70% at properties of this range? I have read elsewhere that some people are comfortable in the 80% range. 

If anyone can provide examples or past history, I would be incredibly grateful. 

Kind regards, 

Heath