Bankruptcy for Calpers-backed LandSource

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News item from Reuters: ‘LandSource Communities Development LLC, a large Californian property developer backed by Calpers, the biggest public U.S. pension fund, said on Sunday it had filed for bankruptcy protection.’

More: ‘While not a shock, the news is a blow to companies and funds unable to extricate themselves from troubles in an industry laid low by the credit crisis.’

LandSource’s primary investment, per Reuters, is The Newhall Land and Farming Company, which owns 15,000 acres of land north of Los Angeles (pictured).

The news is not a shock, according to Reuters, because it was widely reported a month ago that LandSource had defaulted on a loan. At the time, though, LandSource made noises indicating it could avoid bankcrupty: May 9, from the Los Angeles Business Journal: ‘“(LandSource) did go into default but they are still talking to the lenders about restructuring the debt or modifying the terms,” said Tamara Taylor, a spokeswoman for LandSource. “The hope is that they will be able to renegotiate the terms of the loan to everybody’s satisfaction.”

Aside: Bankcruptcy is not usually to everybody’s satisfaction.

May 19, from the L.A. Times: ‘CalPERS President Rob Feckner said he hoped to forestall a bankruptcy but stressed that ‘if we incur any losses, they will be minor’ because the pension fund is ‘very well diversified, in good shape.’

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Photo Credit: L.A. Times