Five months out of bankruptcy, WCI Communities continues to reduce its debt level by disposing of assets that it now considers “non-core." This week, it announced that it had sold off more land outside its new Florida-centric comfort zone.
In the deal, Toll Brothers bought 102 home sites in WCI’s Four Corners community in East Fishkill, N.Y., for $8.9 million, according to WCI, which said that the Florida-based builder will finish the 23 homes it has under construction in the project by year-end.
WCI, once publicly held, came out of bankruptcy Aug. 31 as a private company, with 95% of the company owned by its secured creditors. Bankruptcy allowed it to shed roughly $2 billion in debt as well as its stockholders. However, the builder was not debt-free; after emerging from bankruptcy, WCI still owed $450 million in the form of a loan from its creditors.
Its business plan was to pay off the debt by selling existing inventory as well as non-core undeveloped assets, and it appears to be making progress. WCI reported Tuesday that it made another $70 million payment on its senior loan debt last week, reducing the balance owed to $144.5 million.
“We have paid down over $150 million during the last five months,” noted David L. Fry, president and CEO of WCI, in the sale announcement.
WCI also released its sales numbers for 2009. It ended the year with 741 net sales and closed out 16 towers and 10 communities. It also sold five non-core assets for $108 million during the year.
“We continue to take important steps every day in executing on our plan to pay down debt and operate as a profitable, more efficient Florida-focused home builder and developer,” Fry said in a company release about the sale.
Teresa Burney is a senior editor for BUILDER and BIG BUILDER magazines.
Learn more about markets featured in this article: Orlando, FL.