General Dynamics sold 50 acres of vacant land in Rancho Bernardo at a sharp loss Friday, part of the defense contractor's nationwide effort to sell off some buildings and land parcels.
General Dynamics' Electronics division had planned to build a "research campus" of office buildings with up to 1 million square feet. The company abandoned the plan because of losses and defense budget cuts.
The property is situated in the 235-acre 4S Ranch Business Park, just west of manufacturing plants operated by Sony, Hewlett-Packard and other companies.
Sources said General Dynamics sold the land to TCW Realty Advisers of Los Angeles for about $9.5 million, far below the $17 million General Dynamics paid in late 1989. The parcel originally bought by General Dynamics, however, included about 10 additional acres of streets and easements that the defense contractor had hoped to build over.
The Rancho Bernardo property had been on the market for more than a year. General Dynamics' original asking price for the property was $23 million, local real estate sources said.
The new owner, a real estate portfolio manager who invests for pension plans and other institutions, said Friday it has no immediate plans to develop the property, which will be divided into parcels.
"We have tremendous confidence in the San Diego market," said Rick Liebermann, TCW Realty Advisers senior vice president, who said his company views the deal as a long-term investment.
The Electronics division is one of three General Dynamics divisions with operations in San Diego. The others are the Convair and Space Systems divisions. Each division has been hit by layoffs over the past year as the company tries to regroup amid federal budget belt-tightening.
"We assessed the decision to sell as right after determining that we really didn't need the property," General Dynamics spokesman Jack Isabel said Friday.
Nationwide, General Dynamics has put a number of its properties on the block, according to Mark Palmer, a broker with CB Commercial Real Estate Services of St. Louis, who is representing the defense contractor.
Palmer, who was not involved in the Rancho Bernardo deal, said none of General Dynamics' other San Diego properties is on his list of properties for sale.
"We are working with General Dynamics in the disposition of excess properties around the country, and some are in Southern California," Palmer said Friday, declining to name specific properties being offered for sale.
According to the San Diego Tribune, General Dynamics' Air Defense Systems Division, based in Rancho Cucamonga, is trying to sell five office buildings and 295 acres of vacant land in Pomona and Rancho Cucamonga.