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Lennar Launches Second Multifamily Venture Fund

Homebuilder Will Seed the Fund with Six Properties Under Development
April 4, 2018
The multifamily segment of Lennar Corp. (NYSE: LEN and LEN.B) completed the closing of a second Lennar Multifamily Venture II for the development, construction and property management of class-A multifamily assets.

After its initial first close, Venture II will have approximately $500 million of equity commitments. The total includes a $255 million co-investment commitment by Lennar comprised of cash, undeveloped land and preacquisition costs.

Lennar will seed Venture II with six undeveloped multifamily assets that were previously purchased or under contract by the Lennar multifamily segment. When developed the six properties will total about 2,200 apartments with projected project costs of approximately $900 million.

Lennar's first Multifamily Venture vehicle is involved in the development, construction and property management of class-A multifamily assets with $2.2 billion in equity commitments.

Miami-based Lennar's multifamily segment posted revenue of $93.26 million in the first quarter of this year, up from $88.69 million a year ago. However, the division lost $1.2 million in the first quarter of 2018, primarily due to increased general and administrative expenses. The increases were partially offset by the segment's $4.1 million share of gains as a result of the sale of one operating property.

A year ago, the Lennar multifamily segment had operating earnings of $19.2 million primarily due to the segment's $26 million share of gains on two property sales.


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