Casta Golf Course Update

A Mission Viejo resident who lives near the Casta del Sol Golf Course forwarded a Nov. 10 article from CFO.com, “Default Clouds Hover over Sunrise Senior Living.” Here’s the link: http://www.cfo.com/article.cfm/12585301/c_12583719?f=home_todayinfinance

According to Stephen Taub of CFO.com, Sunrise Senior Living Inc. “reported a $68.7-million third-quarter loss, versus a $38.2-million profit a year ago.”

The article states, “Sunrise Senior Living Inc. warned that it does not expect to be able to satisfy some financial covenants under its amended bank credit facility by year-end. As a result, on Jan. 1 it may no longer be able to borrow unless it receives an additional wavier from lenders.”

The corporation’s financial issues could account for its plans for the Casta course being on hold or uncertain.

Saddleback Valley News quoted a Sunrise spokesman on Aug. 15, 2008, when he said Sunrise was withdrawing its plan to build on the Casta golf course. He alluded to the uncertainty of getting approval for his company’s homebuilding plans. Volunteers working on the Right-To-Vote Initiative had been gathering signatures for a week, and Mission Viejo residents were lining up at storefronts to sign the petition. The community’s resistance to homebuilding on the golf course was obvious.

While American Golf would likely sell the Casta golf course to Sunrise or another buyer if it could, the seller would be obligated to disclose that the voter initiative is in progress. If the potential impact of the initiative doesn’t stop homebuilding developers from making offers on the golf course, the decline of the housing market has virtually halted homebuilding.

The link above lists other articles that reveal the extent of Sunrise’s problems, including a formal probe by the SEC, lawsuits and real estate errors.