Operates within the highly cyclical homebuilding sector High geographic concentration--over one-half of revenue generated in California Smaller scale than other rated peers Shifting strategy to less capital intensive projects, which should aid operational efficiency and boost inventory turns Projected leverage will weaken to over 4x in 2017 before improving in 2018 Cash flow from operations will decline on a year-over-year basis in 2017 due to higher levels of land spending to fund future growth Liquidity remains adequate despite the elevated levels of working capital outflows S&P Global Ratings' stable outlook on Walnut, Calif.-based Shea Homes L.P. reflects our expectation for continued growth in the U.S. housing market, characterized by sound demand fundamentals over the next 12 months that should support
