Pacific Northwest Dallas-based developer Trammell Crow has tentatively agreed to buy Group Health's 28-acre hospital campus in Redmond's...

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Dallas-based developer Trammell Crow has tentatively agreed to buy Group Health’s 28-acre hospital campus in Redmond’s Overlake area.

The companies said Wednesday that Trammell Crow and an unidentified institutional financial partner had signed a letter of intent, the first step in the sale process. They said the deal should be completed by Dec. 1.

Trammell Crow should be ready to discuss its plan for the property then, spokeswoman Cynthia Langhorst said.

The Redmond City Council in December adopted a new plan for the Overlake area that foresees mixed-use development on the campus, including apartments or condos, office, retail and perhaps a hotel in buildings of up to 12 stories.

Group Health closed the 30-year-old hospital May 1 and is moving other services from the campus to a new specialty center in Bellevue and a primary-care center under construction in downtown Redmond.

Banking

CEO to step down after deal collapses

Washington Banking, the parent company of Whidbey Island Bank, said Wednesday that longtime Chief Executive Mike Cann will retire at the end of September.

Cann, 59, has headed the Oak Harbor-based holding company since 1996; he also served as Whidbey Island Bank’s president from 1993 to April 2007. He will be succeeded as CEO by Jack Wagner, 64, the bank’s president.

Cann’s announcement comes just over a month after a deal for Everett-based Frontier Financial to buy Washington Banking fell apart. The two companies have disagreed on circumstances over the deal’s collapse. Both have claimed they’re owed a $5 million breakup fee from the other.

Nation / World

UnitedHealth

Restructuring, payout announced

UnitedHealth Group cleared its decks of bad news on Wednesday, announcing a lower profit outlook, a restructuring that will trim 4,000 jobs and a $900 million payout to settle a class-action lawsuit over options backdating.

Analysts saw the announcements as perhaps the end of a long rough patch for UnitedHealth, the nation’s second-largest health insurer.

The company has been wrestling since 2006 with the backdating scandal, which led to the forced departure of CEO Bill McGuire.

Circuit City

Shares plunge after bid yanked

Circuit City plummeted to historic lows in trading Wednesday after Blockbuster withdrew its takeover bid on Tuesday, causing investors to question the consumer-electronics retailer’s future.

The company, which has lost 86 percent of its stock from its 52-week high of $15.33, says it will continue to review strategic alternatives.

AT&T

Contract-free iPhones to be sold

AT&T will sell the new version of the iPhone without a service contract for $400 more than the price with a two-year plan, a break from the rules set when Apple’s popular touch-screen gadget debuted last year.

Two new models of iPhones go on sale July 11 for $199 and $299, depending on the amount of memory, with two-year AT&T contracts. The contract-free versions will cost $599 and $699 and will be sold sometime “in the future,” AT&T said.

The phones sold under contract are subsidized by AT&T, which expects to make the money back through monthly service fees over the life of the contract.

Without a contract, users can cancel service without incurring an early termination fee. But both contract and contract-free phones will be “locked” to work only on AT&T’s network, and the monthly service plans available will be the same, said AT&T spokesman Michael Coe.

Jupiter eSources

Bankruptcies by businesses on rise

The softening economy and the collapse of the housing market caused U.S. businesses to file for bankruptcy protection at a higher annualized rate than individuals, according to data compiled from June court records.

Bankruptcy filings in the U.S. during the month rose 33 percent from a year earlier and may surpass 1 million in a year for the first time since bankruptcy laws were tightened in October 2005.

Individuals this year have filed at an annualized rate that is 23 percent above 2007, while total commercial bankruptcies rose 34 percent, data compiled by Jupiter eSources show.

Companies filing for Chapter 11 reorganization also rose at an annual rate of 34 percent above the 6,241 filings in 2007.

Commerce Department

Factory orders see slow rise

Orders to U.S. factories turned in the slowest performance in three months in May as a surge in demand for commercial aircraft was not enough to offset weakness in autos, heavy machinery and steel.

Factory orders rose by 0.6 percent in May, less than half the gains turned in during April and March, the Commerce Department reported Wednesday. It was the poorest showing since factory orders had fallen by 0.4 percent in February.

Analysts said the figures for the past three months have been inflated by big increases in the cost of refined petroleum and related products such as chemicals, which have been soaring because of the rising cost of global oil prices.

American Airlines

Flight-attendant cuts announced

American Airlines says it could cut 900 flight-attendant jobs as it reduces flights to cope with record high fuel costs. The airline expects to reduce jobs for pilots and mechanics too, but it hasn’t released numbers yet.

American said Wednesday that job cuts were necessary “to overcome near-term challenges and secure our company’s long-term future.”

Newspapers

Layoffs in L.A., Milwaukee

The Los Angeles Times plans to cut 250 positions, including 150 jobs in the print and Web news departments, amid a continuing industrywide slump in ad sales, the paper’s editor said in a memo Wednesday.

Also Wednesday, Journal Sentinel said it would cut about 10 percent of the Milwaukee Journal Sentinel’s 1,300 full-time employees.

Compiled from The Associated Press, Bloomberg News and Seattle Times staff