Key Resort Parcels Sell for $245 Million in Dana Point
Two prized coastal properties in Dana Point that are scheduled for resort development have been sold to an Australian entrepreneur for about $245 million.
Christopher C. Skase, who burst upon the Southern California scene in March when his Qintex Group agreed to buy the United Artists movie studio, said Friday that he plans to build a “five-star integrated resort” on the two sites, known as Monarch Beach and the Dana Point headlands. The properties are less than a mile apart off Coast Highway.
The 232-acre parcel at Monarch Beach was sold by a partnership of Stein-Brief Group and hotel operator Hemmeter Corp. for an estimated $130 million. The 115-acre Dana Point headlands, a series of oceanfront cliffs that offer spectacular ocean views, was bought from Chandler-Sherman Corp. for about $115 million.
Skase said he could not directly confirm the prices but indicated that the figures are close to the mark.
Skase said from Australia that plans for the two properties have not been finalized but will include a hotel, a health spa, a retail center and residential villas.
The Links at Monarch Beach golf course will be upgraded to championship quality, he said.
Qintex, through its Mirage Resorts division, owns and operates two vacation centers in Australia and one on the Hawaiian island of Kauai at Princeville. Skase said construction would not begin in Dana Point for about two years.
Having the two properties, which together total 347 acres, would give the project “critical mass” and made the purchases a “superior economic package to what would have been possible” if the properties had remained separate, Skase said.
The Qintex purchase comes on the heels of the sale last week of the nearby Dana Point Resort to a Japanese company for about $104 million. Just 16 months earlier, the same hotel had sold for $65 million.
James Kelley, a Newport Beach-based hotel consultant, said the high prices garnered for the three Dana Point properties reflect a tremendous, ongoing demand for resort sites on the coast.
‘Extremely High Value’
“There is nothing to indicate that demand for coastal resorts has been satisfied in Southern California,” he said. “Offshore investors in particular have placed an extremely high value on coastal resorts.”
The new Mirage Resorts plans, together with the Dana Point Resort and the hugely successful Ritz-Carlton, also in Dana Point, will cap the transformation of the south county coast into a major resort destination.
David Stein and Barry Brief bought 550 undeveloped acres at Dana Point in 1983 for $80 million They later sold about half the land for residential development.
In 1987, Stein-Brief teamed with Hemmeter to plan an elaborate, $300-million resort complex that would have included two hotels with a total of 1,126 rooms at the Monarch Beach golf course.
Headlands Hotel Approved
The Headlands site has also been approved for hotel development, though no specific building plans have been approved by the newly incorporated city of Dana Point, which includes the Monarch Bay and Beach, Ritz Cove and Capistrano Beach districts. The existing approvals were a key factor in making the properties attractive to Qintex.
Skase said the Mirage resort would have just one hotel with less than 1,000 rooms, but he said it would take another six months to determine exactly how big the hotel would be, how many residential villas would be built and how much money would be invested.
He also acknowledged that his plans might require further review and approvals by local officials.
Real estate analysts said home parcels with ocean views are at least as important as the resort development potential of the properties, especially the Chandler-Sherman headlands, where there has been approval for development of 60 custom lots, as well 625 hotel rooms.
At the existing Mirage resorts, villas are sold to individuals and benefit from all the resort services. Each resort also serves as an agent for the rental of the properties.
At nearby Ritz Cove, a gate-guarded community next to the Ritz-Carlton, lots for custom homes have doubled, sometimes tripled, in price since Stein-Brief opened sales in November, 1987, said Joseph William Smith, president of the sales office.
Some lots that sold originally for $1 million at Ritz Cove now are reselling for up to $3 million, he said.
Skase, 40, whose name rhymes with case, is a dapper one-time financial journalist who built the company from scratch. Qintex owns Australia’s largest TV network and five TV stations and expects to complete purchase of United Artists film operations from MGM by the end of the summer. That transaction will cost the Australian company $600 million and marks it as a serious player in the global entertainment industry.
Skase said he was attracted to Orange County because of its enormous economic growth and proximity to such major population centers and attractions as Disneyland.
In March, Qintex indicated that it was looking for a resort property in California and said: “The linking of California, Hawaii, Queensland (Australia) and Japan will form a quadrant of strength in the burgeoning tourist market in the Pacific.”
Skase made his remarks as he announced that two Japanese firms--Mitsui & Co. and Nippon Shinpan Co.--had bought a 49% stake in the three existing Mirage resorts for $350 million, a cash infusion that allowed the Mirage division to retire all its debts and book a substantial profit.
Skase said Friday that while it is “likely (that the Japanese companies) would be present” in the Orange County project, the equity structure of the deal has not yet been finalized.
Staff writer Michael Flagg contributed to this story.
THE AUSTRALIAN PURCHASE
Who’s buying: Christopher C. Skase, 40, founder and chairman, Qintex Group, right.
His company: Qintex Group, based in Brisbane, Australia.
Resort holdings: Mirage Port Douglas and Mirage Gold Coast vacation centers in the Australian province of Queensland; the 7,000-acre Princeville resort on the Hawaiian island of Kauai; others.
Media holdings: The Seven Network, Australia’s largest television network; five television stations; a 43% controlling interest in Qintex Entertainment Inc., a Beverly Hills-based television and film production company that will be merged into United Artists.
