Wildwood Estates CFD Workout Plan and Valuation Analysis
Nevada County, CA
The Wildwood Estates Project was a 496-acre subdivision proposed approximately eight miles west of the City of Grass Valley in Nevada County. To facilitate the construction of backbone infrastructure for the Project, the County issued Special Tax Bonds on behalf of the Community Facilities District (CFD). Payments on the bonds defaulted, resulting in delinquencies, penalties, and interest accrued. The property owner for phases 2 through 4 of the subdivision worked with the County to effectuate a workout plan to redeem existing bonds and issue new bonds.
As part of a team working for the County, EPS prepared a residual land value analysis as part of the workout plan. A key element of the workout plan was the determination of a reasonable bond redemption price. EPS's analysis used a net present value, pro forma cash-flow approach to calculate a reasonable bond redemption price. The results were used to determine a bond redemption price that was reasonable and fair to current bondholders and that would neither adversely impact the long-term economic viability of remaining development (phases 2 through 4) in the subdivision nor threaten the security of future bondholders.
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