The San Francisco Airport Commission refunds $110 million in fixed-rate revenue bonds with new variable-rate bonds to lower its overall interest cost.  •  The San Dieguito Union High School District responds to the turbulent auction-rate market by converting $90 million in ARS bonds to fixed-rate securities.  •  De La Rosa & Co. generates $41 million of retail orders to reduce yields and save the L.A. County Metropolitan Transportation Authority significant interest costs on a $25-million Sales Tax Revenue Bond issue.  •  The L.A. Community Redevelopment Agency obtains a strong investment-grade rating on a $12.5-million Taxable Tax-Allocation Bond issue for the Westlake Recovery Project.  •  Despite a tough market, Beverly Hills successfully refunds $31 million in water revenue bonds and $17 million in wastewater revenue bonds for economic savings.  •  The Gridley Redevelopment Agency clears various hurdles caused by tightening credit in the municipal market to successfully execute its first tax-allocation bond financing.  •  Riverside issues unenhanced Bond Anticipation Notes to mute the effects of the collapse of auction-rate securities and prudently control interest costs.  •  The Sacramento Regional County Sanitation District restructures $50 million in auction rate securities with better performing, direct pay variable-rate bonds backed by letters of credit.  • 
 

Investors Jump for Calaveras County Golf Resort

$7,145,000
Calaveras County
Community Facilities District No. 2 (Saddle Creek)
Special Tax Bonds, Series 2006

$5,810,000
Calaveras County Water District
Reassessment District No. 2006-01 (Saddle Creek)
Limited Obligation Refunding Bonds, Series 2006
In August 2006, De La Rosa & Co. closed on two land-secured refunding transactions for a master-planned golf community in the Sierra Nevada foothills. Saddle Creek lies within both a Calaveras County community facilities district (CFD) and a Calaveras County Water District assessment district (AD). CFD and AD bonds were issued in 2001 for infrastructure improvements, but developer Castle & Cooke chose to build up the resort over a longer period. At the time of the refunding, five years after the original bonds were issued, only about 25% of the property was developed.

Because of time constraints, a full appraisal typical of land-secured financing in this early stage of development was not commissioned, making De La Rosa responsible for a higher level of due diligence before marketing the bonds to potential investors. The low build-out and lack of an appraisal were marketing challenges, but home prices in Saddle Creek were strong and Castle & Cooke had substantial financial resources. The DLR Sales and Trading Desk was able to price the bonds at lower interest rates than virtually all comparable land-secured issues, and find buyers who understood the developer’s long-term development plan.
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