Company: LEN
Filing Date: 2025-10-03
Form Type: 10-Q
Source: 0001628280-25-044086
Chunk: 42

Company: LENNAR CORP /NEW/
Filing Date: 2025-10-03
Form: 10-Q
Item: Item 1
Chunk 42
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 optioned land, or is otherwise economically compelled to takedown the optioned land, it may need to consolidate the land under option at the purchase price of the optioned land. As of August 31, 2025, land under option with third parties that the Company was compelled to takedown was $1.5 billion, of which $497.4 million were land purchase contract obligations due to land banks upon maturity of the contracts. The Company's intention is to have other land banks close on the land purchase commitments and the Company will option the land from the land banks. Land under option with third parties is included in consolidated inventory not owned. Consolidated inventory not owned related to land financing transactions, which are land sale transactions that did not meet the criteria for revenue recognition and derecognition of land by the Company as a result of the Company maintaining an option to repurchase the land in the future, was $778.0 million as of August 31, 2025.During the nine months ended August 31, 2025, consolidated inventory not owned decreased by $1.8 billion with a $1.6 billion decrease to liabilities related to consolidated inventory not owned in the accompanying condensed consolidated balance sheet as of August 31, 2025. The decrease was primarily due to the reassessment of certain option contracts terms that were amended. This reassessment resulted in a decrease of $2.0 billion of consolidated inventory not owned with a corresponding 

27

Lennar Corporation and SubsidiariesNotes to Condensed Consolidated Financial Statements (Unaudited) (Continued)

decrease of $1.9 billion of liabilities related to consolidated inventory not owned. The decrease was partially offset by the consolidation of homesites under option contracts that the Company is compelled to takedown, which resulted in an increase of $668.9 million of consolidated inventory not owned with a corresponding increase of $612.7 million of liabilities related to consolidated inventory 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 August 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 August 31,