New wave of development district defaults

Florida community development districts are defaulting with increasing frequency. Investors’ dumping of these bonds has caused more defaults on development district bonds than on all other tax-free debt in America. The problem was exemplified in a recent high-profile sale of defaulted bonds in Tilson’s Landing, an incomplete project in Jacksonville. The builder at Tilson’s Landing was Yellow Bluff, which was a venture between Jacksonville companies and Miami-based homebuilder Lennar, although Lennar has not commented on its community development district operations. [Business Week]

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