Miami-based Lennar, a prominent homebuilder, has made a strategic decision to put a substantial multifamily portfolio on the market, despite a sluggish investment landscape in the sector this year. The move involves the potential sale of more than 11,000 apartments, estimated to fetch around $4.5 billion, as reported by Bloomberg Law.
Partnering with JLL, Lennar aims to market these properties, offering flexibility by considering the option of dividing the portfolio into smaller segments.
The properties in question are managed under Quarterra, Lennar’s luxury multifamily development subsidiary. Founded in 2011, Quarterra has a focus on the development, construction and management of luxury rental communities across the nation, according to its website. Since it was founded, Quarterra has developed more than 80 apartment communities and has projects in the pipeline valued at approximately $8B.
Established in 1954, Lennar has constructed more than one million homes nationwide, its website shows.
This decision to sell appears against the backdrop of Lennar’s recent Q4 earnings report. According to that announcement, Lennar’s multifamily holdings recorded an operating loss of $12 million. In contrast, Lennar’s home building segment performed robustly in Q4, delivering 23,795 homes and generating $1.4 billion in earnings.
“During our fourth quarter, the economic environment shifted as interest rates rose for most of the quarter, and then subsided. Higher interest rates tested homebuyer sentiment, although purchasers remained responsive to incentives that enabled affordability. The well documented production deficit and chronic supply shortage continued to result in housing demand outweighing short supply. These conditions remained constructive for our overall operating strategy of focusing on production and sales pace over price, generating strong cash flow, increasing returns on equity and assets, and driving a strong bottom line.” Stuart Miller, executive chairman and co-chief executive officer of Lennar, said in a statement.
