DANA POINT — A 232-acre swath of seaside land owned by Qintex, the troubled Australian entertainment and resort company, is facing foreclosure by its creditors.
The Monarch Beach property, one of the last large undeveloped coastal properties in Orange County, was scheduled for public auction today. But the forced sale was postponed pending negotiations between Qintex and its creditors.
A source close to the talks said that a sale of the land, possibly to one of the creditors, could come within two weeks. Qintex had planned to develop the property into a luxury resort-hotel complex.
One group of creditors includes the former owners of the land, Dana Point developers Stein-Brief Group and Hawaiian hotel developer Hemmeter Development Corp. Stein-Brief and Hemmeter bought the land for $32 million in 1987 and sold it to Qintex for $132 million last year. As holders of a first mortgage, they are to be paid off first in the event of a sale.
The second group of creditors consists of Japanese and Australian banks and Nippon Shinpan, a Japanese credit card company. This group holds a second mortgage and stands in line behind the first group of creditors to be repaid. They lent Qintex the money to buy the land from Stein-Brief and Hemmeter.
Nippon Shinpan and Mitsui & Co., a huge Japanese trading concern, already own half of Qintex's three other resorts and have an option to purchase half the Dana Point resort. It is thought these companies, which couldn't be reached for comment, may be interested in buying the entire Dana Point parcel and building their own resort on it.
The land already has all government permits to build a big, 800-room resort hotel and a smaller hotel.
Meanwhile, Qintex told the Dana Point City Council this week that it wants to build only the smaller hotel and instead build condominiums on the site. That is not likely to sit well with a council that wants the sales tax revenue from a big hotel, say city officials. And it's not likely to sit well with local residents, who fear the condominiums will add to the traffic on local streets.
Qintex officials declined comment.
The only other large, undeveloped piece of land on the coast in Dana Point--the Headlands--is also up for sale.
Qintex had an option to buy that property but lost it when the resort and television company became overextended last year. At the time the owners asked about $120 million. Now that the property is back on the market, however, the asking price ranges as high as $212 million.
Most of the sprawling Qintex corporate structure is in receivership in Australia and is being slowly dismembered as assets are sold.
The entity that owns the Dana Point land, however, is not in receivership, according to the Australian receiver appointed to oversee the dismantling of the parent company.