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15,000-acre California real estate business files for bankruptcy; pension is main investor

15,000-acre California real estate business files for bankruptcy; pension is main investor

A California real estate partnership that has the largest U.S. public employees pension fund as its main investor has filed for bankruptcy protection. It is one of the largest land deals to falter amid the national housing glut.
LandSource Communities Development LLC issued a news release late Sunday to announce the bankruptcy filing in U.S. Bankruptcy Court in Delaware.
The partnership's assets include 15,000 acres (6,070 hectares) of undeveloped land north of Los Angeles in the Santa Clarita Valley.
The California Public Employees' Retirement System, or CalPERS, is its main investor. Officials there did not immediately return calls early Monday.
LandSource had been trying for months to restructure a $1.24 billion debt, the company said. It received a default notice on April 22 after missing a payment when a decline in the assessed value of that Southern California land holding triggered an additional charge.
Attempts to reach LandSource before business hours were unsuccessful.
LandSource operates in California, Arizona, Florida, New Jersey, Nevada and Texas. The partnership announced it has received a $135 million line of credit from a group of lenders led by Barclays Bank, allowing it to fund operations during the bankruptcy reorganization period.
CalPERS, with $254.8 billion in assets, is involved in LandSource through its participation in MW Housing Partners, an investment fund managed by MacFarlane Partners LLC.
MW Housing Partners acquired 68 percent of the Santa Clarita property from home builder Lennar Corp. and LNR Property Corp., a unit of Cerberus Capital Management LP.
Lennar and LNR each maintained a 16 percent interest in LandSource.
CalPERS provides pension, health care and other retirement services for about 1.5 million public employees.


Updated : 2021-03-09 06:04 GMT+08:00