REAL ESTATE : Pru Group Owner Says His Holdings Are in Good Shape
Real estate developer Igor M. Olencoff wants it known that although one of his companies, Pru Group Properties Inc., filed last month for protection under Chapter 11 of the U.S. Bankruptcy Code, his other companies are doing just fine.
“Olen Capital’s substantial loan portfolio is experiencing no defaults. Olen Realty’s apartment portfolio of 8,000 units are over 95% occupied,” Olencoff wrote in a recent newsletter.
Pru Group’s major creditor, Prudential Insurance Co. of America in Newark, N.J., had filed a notice of default against the company on a $140-million loan. Six other creditors are owed a total of $15 million.
Pru Group, based in Irvine, owns 18 industrial and office buildings across Orange County and one retail center in Las Vegas. The company listed debts of $167.6 million. The value of its assets is still being evaluated by lawyers for Prudential Insurance and Pru Group.
“The properties were financed at the height of Orange County’s real estate boom and, unfortunately, now have diminished in value,” Olencoff said. “Rents have diminished by 30% to 50%, and vacancies have increased from 5% to 21%.”
The bankruptcy filing is “nothing to be ashamed of,” Olencoff said. “The recession is not something that we created.”
Other news across the county:
* Irvine-based Kitchell Contractors, which specializes in the construction of health-care buildings, has been selected as construction manager and general contractor for the $32-million expansion and remodeling of the University of Southern California’s Kenneth Norris Jr. Comprehensive Cancer Center in Los Angeles. The project, scheduled for completion in 1995, includes a 150,000-square-foot facility for cancer research laboratories.
* Anaheim-based general contractor Lyle Parks Jr. Inc. began construction of two Ralphs Supermarkets in Castaic and Panorama City. The stores, each 50,000 square feet in size, are scheduled for completion this fall. Financial terms of the contract were not released.
* Santa Anita Realty Enterprises Inc., an Orange-based real estate investment trust that owns the Santa Anita racetrack, bought a 279-unit apartment complex in Beaverton, Ore.--a planned community near Portland--from Security Pacific Bank for $10.2 million. With its latest purchase, Santa Anita Realty now owns 1,163 apartment units.
* Besteel Industries, an Irvine modular design and construction company, completed a $2.1-million Riker’s Island Jail West addition for the city of New York.
* Foothill Ranch Co., developer of the 2,743-acre Foothill Ranch community in south Orange County, sold its first lot in its newly created 40-acre industrial zone. Newport Beach-based Lebata Inc., a concrete manufacturer, bought the 2.5-acre site for $1.1 million.
