RESIDENTIAL
A venture headed up by Irvine’s Foremost Communities Inc. has made a nearly $10 million investment in Riverside.
Forestar Land Partners, a venture of Foremost and Greenwich, Conn.-based Starwood Capital Group Global LP, paid $9.5 million at an auction for 217 lots in Riverwalk Vista, an upscale, partially developed housing project that totals about 100 acres.
The site, which had gone into foreclosure, is in the city of Riverside, just south of Interstate 91 at La Sierra Avenue.
Foremost said it plans to hold the lots for three to four years. It also said it was interested in acquiring the remaining 185 lots at Riverwalk Vista, including 39 existing homes and models, as soon as they become available.
“By the time (Riverwalk Vista) got mothballed in 2007, the original developer already had installed the roads, utilities and entry gates and landscaping, so it’s primed and ready to go,” Foremost President Steve Cameron said.
According to reports, the project formerly was under development by Riverside-based Griffin Industries, which acquired the land from Riverside Community College.
Foremost owns or manages more than 1,000 housing lots in Southern California.
Dead Deal
Israel’s Tower Semiconductor Ltd. appears to be making a long-term investment in its Newport Beach production plant.
And that investment may have killed one of the largest housing land deals Orange County’s seen proposed of late.
Newport Beach-based chipmaker Conexant Systems Inc. last month said it pulled out of a $26 million deal it had with Santa Ana-based developer City Ventures LLC to sell buildings and land next to its headquarters, near Newport Beach’s city line with Irvine.
City Ventures, one of the more active buyers of land in Southern California in the past year, had eyed the 25 acres of land along Jamboree Road that Conexant was selling for a sizable housing development that could start later this decade.
The deal first was announced in January.
When Conexant said it was pulling out of the deal, it was implied that the reason was because City Ventures was asking for a lower price on the land.
Craig Atkins, chairman and cofounder of City Ventures, said that’s not the case.
Instead, it’s the likely long-term commitment of Tower Semiconductor at a 389,000-square-foot production plant on the land that turned out to be “the only real reason” the deal collapsed, he said.
Tower has a lease for the site through 2017, but it has the option to extend that lease through 2027—a fact that was “buried” in the sales package for Conexant’s land and property, according to Atkins.
Tower told City Ventures it plans to extend the lease and rebuffed offers to buy out a part of the lease, according to Atkins.
“They have no intention of leaving,” said Atkins of Tower.
Holding the land for nearly 17 years without the ability to develop the site into homes made the deal unworkable for City Ventures, he said.
Conexant said last month it would consider alternatives for the real estate, including a sale to another party or retaining it for the foreseeable future
Tower, which operates as TowerJazz, bought what was Newport Beach’s Jazz Semiconductor Inc. in 2008 for $40 million plus an additional $129 million in debt.
The company said in February it plans to spend $15 million to add equipment to the Newport Beach plant and another in Israel to boost production of silicon wafers, the building blocks of semiconductors.
COMMERCIAL
A few months after JPMorgan Chase & Co. announced the relocation of its regional banking headquarters to an Irvine high-rise, the New York-based bank has struck another big local lease for some of its lending operations.
JPMorgan Chase recently signed a 127,718-square-foot office lease renewal at 1833 Alton Parkway. JPMorgan, which signed a five-year lease renewal, uses the Alton facility for loan servicing operations.
A large chunk of the building previously was used by Irvine-based subprime lender Encore Credit Corp., which leased close to 200,000 square feet of office space along Alton Parkway near the peak of the housing market.
Encore was sold to Bear Stearns Cos. in 2007 at the tail end of the subprime industry’s collapse. JPMorgan acquired faltering Bear Stearns in 2008.
The Alton lease comes about two months after Chase announced that it had signed a seven-year, 70,000-square-foot lease in Jamboree Center in Irvine for its regional banking headquarters.
The company, which runs the third-largest bank here by deposits, had been occupying space previously used by Washington Mutual Inc. at Irvine’s Quintana office campus.
JPMorgan inherited the campus when it acquired Seattle-based Washington Mutual in late 2008.
Grubb & Ellis Co.’s Chon Kantikovit, Maury Gentile and Mike Carson represented JPMorgan in the Alton Parkway lease. The landlord, Foster City-based Legacy Partners, represented itself.
Legacy Partners bought the buildings in 2005, as part of a $46 million portfolio acquisition.
