Bankruptcy judge rules on Lennar Newhall Ranch buyback

This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.

The tangled saga of the Newhall Ranch housing development took another twist today, when a U.S. Bankruptcy Court judge said he might allow the project’s former owner to buy some of it back.

Judge Kevin J. Carey ruled in Delaware that Lennar Corp. could purchase a 15% interest in the Santa Clarita Valley project and other properties for $140 million -- if creditors endorsed and the court approved the deal.

Florida-based Lennar, the nation’s second-largest home builder, had sold a stake in Newhall Ranch to the California Public Employees’ Retirement System for $970 million in 2007. The 15,000-acre tract north of Los Angeles is one of the few remaining parcels of its size left in Southern California.

Lennar’s purchase, if approved, could leave the builder well-positioned to construct homes as the housing market recovers. CalPERS and other equity holders would see their investments wiped out in the deal.

-- Peter Y. Hong