Powered by expansion in Las Vegas and Southern California, M.D.C. Holdings has increased its J.P. Morgan-led $700 million unsecured credit facility to $1.058 billion with the ability to upsize it to $1.25 billion. In the past three years, M.D.C., has entered seven new markets Salt Lake City, Dallas, Houston, Jacksonville, Fla., Tampa, Fla., Chicago and Philadelphia/Delaware Valley but Gary Reece, executive v.p. and cfo, attributed much of the company's growth to expansion in Vegas as well as growth in Phoenix and Southern California.
"As our company has grown, we have continued to expand our credit facility," Reece said. Last year, the company, which builds houses under the name Richmond American Homes, had a record year and in April added $100 million to a $600 million Bank One-led revolver (LMW 4/16). The company is now heavily expanding in New Jersey and Reece said Orlando, Fla., looks attractive and could be a logical extension.
"We don't have any immediate needswe are in pretty good shape from an equity standpointbut we thought it was important to tie up availability while we could," Reece said. Competitors have also substantially increased their credit lines in recent months. M/I Homes increased its facility from $315 million to $500 million, with an accordion feature so it can increase its credit to $750 million (8/10). Toll Brothers expanded its revolver from $575 million to $1.05 billion with an accordion to $1.2 billion and WCI Communities and Technical Olympic have also increased borrowing capacity (10/29).
J.P. Morgan is the sole arranger and book manager for the facility. Reece said the team at Bank One remained fully intact following the merger of the two banks. Other lenders participating include Wachovia Bank, BNP Paribas, Citigroup, Guaranty Bank, The Royal Bank of Scotland, SunTrust Bank, US Bank National Association, Bank of America, California Bank & Trust, Comerica Bank, KeyBank, Washington Mutual Bank, AmSouth Bank, Mizuho Corporate Bank, PNC Bank and RBC Centura Bank, Bank of the West, City National Bank and Compass Bank.