A sale of the Santa Ana headquarters of the Orange County Register to developer Mike Harrah is expected to close within a few days, according to sources.
Harrah, the largest commercial property owner in downtown Santa Ana, has been in negotiations to buy the newspaper’s headquarters at 625 N. Grand Ave. for several weeks.
The five-story office, which is just off the Santa Ana (I-5) Freeway near the Costa Mesa (55) Freeway, runs about 173,000 square feet. It is expected to trade hands for nearly $27 million.
The deal could close as soon as today, according to sources familiar with the transaction.
Freedom Communications Inc., the owners of the Register, put the office building on the market late last year.
The sale comes amid talk of mounting financial challenges for Freedom Communications, which was acquired in 2012 by Chief Executive Aaron Kushner’s 2100 Trust LLC.
The debt-strapped company has initiated a number of cost-cutting moves this year, and has been shedding jobs in the past few months through buyouts and layoffs.
Sources familiar with the company’s operations said that Freedom has recently missed on some severance payments tied to those earlier buyout agreements.
Freedom spokesperson Eric Morgan confirmed that a sale of the headquarters building is expected to close soon, and attributed reports of missed severance payments to “an issue with our payroll processing system.” Morgan said the company would issue checks to meet the severance payments later today.
Court filings related to a lawsuit two former Register executives brought against Kushner and Freedom suggest a bulk of the money raised from a sale of the paper’s headquarters is already spoken for.
Freedom and its entities owe about $24.7 million in senior loans, and the former executives are owed $4 million in severance payments under terms of a recent judgment in their favor, according to court documents.
— Mediha DiMartino contributed to this story.
