Deal for Balboa Bay Club collapses
A deal to sell the Balboa Bay Club and Newport Beach Country Club to a wealthy Hong Kong businessman has collapsed.
The $174.5-million deal for the combination yacht club and hotel and its sister Newport Beach Country Club was called off Jan. 13.
Investor Winston Chung never came up with the money as agreed, forfeiting what city documents show was a nonrefundable $4-million down payment.
“We were told he was having difficulty moving money out of China,” David Wooten, chief executive of the clubs, said Monday.
The deal for the iconic Balboa Bay Club & Resort, a fixture along Newport Harbor for more than 60 years, was reported in early August.
International Bay Clubs Inc., which owned the BBC and the Newport Beach Country Club, was to be sold to Delaware-based Seven-One Capital-Business Inc.
IBC is owned by Beverly Ray Parkhurst, who has been involved with the BBC for more than 40 years and the country club since the mid-1980s.
The Bay Club deal is one of at least three stalled ventures.
A seven-figure deposit Chung made in June on a Newport Harbor mansion once owned by actor Nicolas Cage is in jeopardy because he never came up with the money to complete the purchase.
And a plan to increase manufacturing at a Riverside motor home company, with the four-year goal of selling $5 billion in tour buses and campers to newly wealthy Chinese consumers, has been on hold for a year while awaiting approval from Chinese regulators.
Chung, 53, whose companies in the south China boom town of Shenzhen make products such as electric vehicle power trains and storage batteries for power plants, insisted early this month that the setbacks in Southern California would be temporary.
He blamed the delays on Chinese government reviews. Cash for the Balboa Bay Club and the waterfront estate was being held up by China’s State Administration of Foreign Exchange, Chung said.
His plan to sell U.S. motor homes in China was waiting approval from the country’s Ministry of Commerce.
In telephone interviews, he said Chinese authorities had assured him that approvals would be forthcoming in time for him to buy the properties and to start manufacturing motor homes in March.
“One-hundred percent certain they’re going to go through,” Chung said of his pending deals.
A spokeswoman declined to comment further Monday.
Aaron Brickman, a U.S. Commerce Department official overseeing a program to stimulate foreign investment, said difficulties in getting funds out of China are not surprising.
Unlike major Western countries, China controls the outward flow of cash as well as money coming into the country.
“China is still becoming comfortable with its own evolution regarding capital flow and investments,” Brickman said.
The setbacks are bad news for Brad Williams, chief executive of MVP RV Inc., the Riverside maker of motor homes and trailers.
Williams said that about $30 million from a Chinese investment group that included Chung rescued his idled company in 2010. Among other things, the backing enabled MVP to buy a 24-acre Riverside manufacturing complex from bankrupt RV giant Fleetwood Enterprises.
But an additional $310 million in funding that Chung had pledged to jump-start production appears to be in jeopardy. At the very least, it won’t flow until Chinese authorities approve the design of the tour buses and campers that MVP hoped to sell in China.
Williams, who had talked of generating 1,200 jobs in the economically battered Inland Empire — a deal the White House praised as an emblem of U.S.-China cooperation — expressed frustrations in an interview last year.
“I’m dying to start hiring and I can’t,” he said.