OVERVIEW Walnut, Calif.-based Shea Homes L.P. is a well-seasoned private homebuilder with 79 active selling communities in six states. We assigned our 'B' corporate credit rating to the company and its subsidiary, Shea Homes Funding Corp., reflecting an aggressively leveraged financial profile with weak credit metrics relative to industrial peers. We also assigned our 'B' issue-level rating and '4' recovery rating to the company's proposed $750 million senior secured notes. The positive outlook reflects our view that an upgrade is possible within the next 12 months if sales absorption levels remain flat or improve over the coming year and if the company maintains an adequate liquidity profile. NEW YORK (Standard&Poor's) April 27, 2011--Standard&Poor's Ratings Services today
