Bloomberg BusinessWeek is out with a piece on Florida’s misadventures in real estate. Apparently Eaton Vance is dumping Florida municipal bonds tied to real estate deals at $.26 on the dollar.

Still no need to mark down any of those bank assets, of course. The underlying assets will bounce back, we keep hearing. Well, Moody’s says the Florida RE market might not recover until the 2030s.

Thomas Metzold, Eaton Vance Corp.’s co-head of municipals, sold all his defaulted bonds of Tison’s Landing, an unfinished housing development in Jacksonville, Florida, as the debt fell to a third of face value last year. Dumping the so-called dirt bonds at a discount was a better bet, the Boston-based Metzold said, than taking over 218 empty acres (88 hectares) from the project’s builder and waiting for a real-estate rebound that may not come until the early 2030s, according to a Moody’s Economy.com forecast.

The BW piece is full of good quotes and info, and I do recommend reading the whole thing. Here’s another snippet:

‘It’s the single biggest default wave in the history of municipal bonds,’ said Richard Lehmann, the newsletter’s publisher, who defines default as failing to pay debt service or tapping reserves to do so. ‘There are about 78 more districts with $2.7 billion of bonds on our watch list that are likely to go into default this year.’

Source: Bloomberg BusinessWeek (which I’m quite impressed with lately).