REAL ESTATE
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Junk Bond Sale: Orange County home builder Presley Cos. is expected to go to Wall Street this week to sell $200 million in junk bonds through underwriter Donaldson Lufkin & Jenrette in New York. The bonds were rated single-B-minus by Standard & Poor’s Corp., the New York rating firm.
Proceeds from the offering will be used to retire high-interest-rate debt as part of the company’s capital restructuring plan.
Presley, based in Newport Beach, builds homes in California, New Mexico and Arizona, though most of its business is in Southern California.
“The recently completed quasi-reorganization in combination with this new financing should well position Presley to benefit from a gradually improving Southern California economy,” S&P; said in its report, but it also noted that the builder remains highly leveraged, with a debt-to-capitalization ratio of nearly 70%.
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