Company: LEN
Filing Date: 2025-07-01
Form Type: 10-Q
Source: 0001628280-25-033777
Chunk: 128

Company: LENNAR CORP /NEW/
Filing Date: 2025-07-01
Form: 10-Q
Item: Item 8
Chunk 128
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 an increase of $668.9 million of consolidated inventories not owned with a corresponding increase of $612.7 million of liabilities related to consolidated inventories not owned. To reflect the purchase price of the homesite takedowns, the Company had a net reclass related to option deposits from consolidated inventory not owned to finished homes and construction in progress in the accompanying condensed consolidated balance sheet as of May 31, 2025. The liabilities related to consolidated inventory not owned primarily represent the difference between the option exercise prices for the optioned land and the Company’s cash deposits.The Company's exposure to losses on its option contracts with third parties and unconsolidated entities was as follows:(In thousands)At May 31, 2025At November 30, 2024Non-refundable option deposits and pre-acquisition costs on real estate$5,172,351 3,529,889 Non-refundable option deposits included in consolidated inventory not owned342,690 520,731 Letters of credit in lieu of cash deposits under certain land and option contracts419,211 341,834 For the six months ended May 31, 2025, the Company purchased a significant portion of land from two land banks (the “Land Banks”). There were no amounts due to the Land Banks as of May 31, 2025, resulting from land purchases as the full purchase price of the land is typically paid to the Land Banks at closing when land is purchased by the Company. As of May 31, 2025, the total deposits and pre-acquisition costs on real estate relating to contracts with the Land Banks were $2.3 billion. As of May 31, 2025, total consolidated inventory not owned and liabilities related to consolidated inventory not owned for the option contracts with the Land Banks were $498.1 million and $409.3 million, respectively.The Company believes there are other land banks that could be substituted should the Land Banks become unavailable or non-competitive with respect to land banking of future land. Thus, the Company does not believe that the loss of the Company’s relationship with these Land Banks would have a material adverse effect on the Company’s business, financial condition or cash flows. As discussed in Note 2, on February 7, 2025, the Company completed the spin-off of Millrose. The spin-off involved $5.6 billion of land assets, representing approximately 87,000 homesites. The Company entered into a