Company: LEN
Filing Date: 2025-10-03
Form Type: 10-Q
Source: 0001628280-25-044086
Chunk: 107

Company: LENNAR CORP /NEW/
Filing Date: 2025-10-03
Form: 10-Q
Item: Item 8
Chunk 107
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 investments usually finance their activities with a combination of partner equity and debt financing. In connection with many of the bank loans to the Multifamily unconsolidated joint ventures, the Company (or entities related to them) has been required to give guarantees of completion and cost over-runs to the lenders and partners. Those completion guarantees may require that the guarantors complete the construction of the improvements for which the financing was obtained. Additionally, the Company guarantees the construction costs of the project as construction cost over-runs would be paid by the Company. Generally, these payments would increase the Company's investment in the entities and would increase its share of funds the entities distribute to the Company after the achievement of certain thresholds. The details related to these are unchanged from the disclosure in the Company's Notes to the Financial Statements section in its 2024 Form 10-K. As of both August 31, 2025 and November 30, 2024, the fair value of the completion guarantees was immaterial. As of August 31, 2025 and November 30, 2024, the Multifamily segment's unconsolidated entities had non-recourse debt with completion guarantees of $757.5 million and $907.8 million, respectively. The decrease in the non-recourse debt with completion guarantees was due to completion of projects and sale of joint ventures' rental operation projects and investments in various rental projects. In many instances, the Multifamily segment is appointed as the construction, development and property manager for its Multifamily unconsolidated entities and receives fees for performing this function. Each Multifamily real estate investment trust, JV and fund has unilateral decision-making rights related to development and other sales activity through its executive committee or asset management committee. The Multifamily segment also provides general contractor services for construction of some of the rental properties owned by unconsolidated entities in which the Company has investments. In some situations, the Multifamily segment sells land to various joint ventures and funds. The details of the activity were as follows:Three Months Ended August 31,Nine Months Ended August 31,(In thousands)2025202420252024General contractor services, net of deferrals$42,150 67,190 100,864 253,260 General contractor costs41,766 63,774 97,665 239,458 Land sales to joint ventures— — 162,447 14,454 Management fee income, net of deferrals5,126