Company Sells Newport Land to Help Debts

Semiconductor manufacturer Conexant is set to sell a piece of land next to its headquarters in Newport Beach to an urban development group, the proceeds of which will be used in part to pay off the company’s debts.

The 25-acre parcel, located on Jamboree Road, will be sold for $26.1 million. The lot is currently occupied by two leased buildings and has belonged to Conexant for several years, although it hasn’t been in active use.

The property was snapped up by City Ventures LLC, a Santa Ana-based real estate developer specializing in residential and semi-commercial projects in California. The purchase is part of its plan to spread “mixed-use” developments throughout the state.

Scott Mercer, chairman and CEO of Conexant, said the land is one of the non-core assets that the company is in the process of monetizing. The move is designed to help improve their balance sheets and reduce their debts, among other “general corporate purposes.”

Experts have given mixed reactions concerning the property’s sale price. Some say it was overpriced considering the land is almost completely bare, while others think it’s a steal for its central urban location.

The property was reportedly worth $75 million in 2007, but Conexant was not willing to sell at the time. Some speculate that City Ventures will turn the lot into a residential complex, given the poor expectations for the commercial real estate business.

The purchase is set to close in late March, following “due diligence” procedures on the part of the buyer. Conexant will then use the proceeds to pay off part of its outstanding debt and finance other company projects.

 

Earlier in Newport Beach Real Estate News:
Newport Beach Home Prices Up Over Year
Newport Beach Among O.C.’s Slowest Markets
Newport Beach ZIP Sees Sales Spike as Prices Plunge