One of the largest homebuilding companies in the U.S. is lined up for years of ongoing activity in the Sacramento region, buying hundreds of future lots.
Records show in recent weeks Lennar Corp. has bought more lots in ongoing projects such as Northlake in Sacramento, as well as a future phase of the Arbor Ranch project in Elk Grove.
Lennar (NYSE: LEN), headquartered in Miami, did not return inquiries about the transactions, which closed in the last few months.
“Every home that is going to be built needs a homesite with a permit and those homesites need to be optioned and off balance sheet until we’re ready to build,” Lennar’s Executive Chairman and co-CEO Stuart Miller said on a conference call with investors and analysts last month to discuss the company’s first-quarter financial results. “We continue to focus on a just-in-time delivery program for land just like we have for lumber and appliances and other products, and we continue to make excellent progress in this regard. We accomplished this by both negotiating option deals with landowners and developers and also creating structured land bank strategies, often with private equity capital.”
in the most recent deal, Lennar bought land entitled for up to 280 homes in the Arbor Ranch project in Elk Grove, west of Big Horn Boulevard. Lennar paid $40.58 million for those lots, according to public records.
Kristyn Laurence, a spokeswoman for the city of Elk Grove, said Lennar has not yet submitted a formal building application for those lots. The company’s website does not show any active projects in that city, though it is selling homes in the unincorporated area of Vineyard to the northeast.
Richland Communities appears to be the seller in that deal. A message left with the company was not returned.
About a week earlier, records show Lennar also took down more lots in Northlake, a project at the northern end of the city of Sacramento.
In two separate deals, Lennar bought 76 parcels with addresses on Davies Harbor Court and other Northlake streets for $16.288 million, and 37 parcels with addresses on Watermist Way and other Northlake streets for $8.49 million.
It was not immediately clear how many home lots those purchases encompassed, though in many cases the assessor parcel numbers refer to individual lots for homes rather than larger tracts of land that have yet to be subdivided. That suggests the purchase was for about 110 lots.
Lennar bought both of those tranches of lots from entities connected to Integral Communities, the master developer for Northlake. A message left with Integral was not returned. Lennar is planned to be the only market-rate homebuilder for the Northlake project.
Current listings for Lennar homes in Northlake range from $715,000 to $886,000, according to the company’s website. It does not appear to be active yet in building the lots it recently purchased.
Before those purchases, records show Lennar bought 15 parcels in the Russell Ranch portion of Folsom Ranch for $3.965 million, and 19 parcels in the Sunridge Park Village area of Rancho Cordova for $3.3 million.