No Dunes bid from Newport Beach

June Casagrande

NEWPORT BEACH -- Prospective buyers of the Newport Dunes Waterfront

Resort property have lined up, but the city isn’t among them.

Bids have been submitted on the property, according to a spokeswoman

for Eastdil, the Los Angeles real estate company handling the potential

sale of the Dunes lease.

However, the number of bidders, their names and dollar amounts were

not disclosed. But it’s likely that whoever buys the lease will want to

take advantage of the potentially lucrative option to build a hotel

there.

The state-owned land is already approved for a 275-room “family inn,”

according to the 1972 lease agreement between Orange County and Dunes

operators Evans Hotels of San Diego.

Evans had tried to get approval for a 581,000-square-foot, 470-room

resort and conference center. The city’s Greenlight Initiative, which was

passed last year to require voter approval for certain large projects,

killed the developer’s hopes for a bigger hotel.

Residents and officials had hoped the city would step in to buy the

lease on the 100-acre site to prevent either hotel from being built there

-- and to prevent the traffic congestion and other problems a hotel could

bring.

The city was considering ways to finance the $25-million to

$50-million purchase when, in late September, Eastdil announced a bid

deadline, which was Tuesday.

“There wasn’t enough time to do our due diligence,” City Manager Homer

Bludau said.

Officials stopped working on their proposal, which could have included

a taxpayer-financed bond. They announced they would wait until after the

bid closing date to see whether there was any use in drawing up a

proposal. Now that the closing date has come and gone, it appears the

city may be shut out for good.

If Evans Hotels accepts a bid and subsequently sells the lease on the

land, the matter will go to the county. As issuer of the lease, which is

good through 2039, the county must approve the lease transfer to any new

owner. There’s a chance that the city could ask county supervisors to

intervene at that time.

If the opportunity to bid arises again, the city might take advantage

of that chance, Bludau said.

“We are willing to look at any other opportunities that might come

along on that piece of property,” he said.