Newhall Land says it will be business as usual, despite filing.
The parent company of development giant Newhall Land filed a voluntary petition Sunday for Chapter 11 protection under the Bankruptcy Code.
The petition was filed in U.S. Bankruptcy Court District of Delaware by the Aliso Viejo-based LandSource Communities Development, LLC, which operates in California, Arizona, Florida, New Jersey, Nevada and Texas. The company develops master-planned communities and transforms undeveloped land into ready-to-build home sites and commercial properties.
Investors in LandSource include the country’s largest public pension fund, CalPers, which holds a 68 percent interest in the company. LandSource’s largest holding is Newhall Land and its 15,000 acres in north Los Angeles County.
Newhall Land spokeswoman Marlee Lauffer said that the filing should not disrupt their day-to-day activities.
“Obviously, we’re a 125-year-old company and a 40-year developer of Valencia and we’re going to continue to do the work here planning the remainder of Valencia and the future Newhall Ranch community.
Asked if there were any layoffs in the company’s future, Lauffer said she wasn’t worried.
“Certainly there may be changes in timing of various projects,” she explained. “Chapter 11 is a process that a number of companies use throughout the country; it’s an opportunity to restructure debts so that we can continue to do business.”
“LandSource believes Chapter 11 provides the most effective means for the partnership to preserve the value of its business, meet postpetition obligations and maintain constituents’ confidence while it works with creditors to achieve a long-term restructuring,” said spokeswoman Tamara Taylor.
The company has been given a $135 million revolving line of credit from a group of lenders that includes Barclays Bank. The purpose of the fund is to make sure obligations existing at the time of the filing will be paid.
The filing came after several months of negotiations with lenders in an attempt to modify and restructure the company’s debt, according to a release from LandSource. The problems began April 22 when LandSource defaulted on loan payments. According to Standard and Poor, the company’s cash had declined to $25 million from about $115 million in early February.