Brian Bandell
Jun 20, 2024
Lennar Corp. has 31.05 acres in the Redland area west of Homestead under contract as it seeks approval for a single-family home community.
Four Aces Properties IV LLC, managed by Miami builder Peter Adrian, filed a pre-application with Miami-Dade County officials concerning the tree farm and agricultural site at the northeast corner of Krome Avenue and Southwest 288th Street/Biscayne Drive. The application states the land is under contract to Miami-based homebuilder (NYSE: LEN).
The homebuilder wants to rezone the site from “estate use suburban” (2.5 units per acre) to “single-family residential” and restrict development to 97 single-family homes. That includes a 25% workforce housing density bonus, which would require 10% of the homes being reserved for people making up to 140% of area median income.
The median household income in Miami-Dade is $79,400, according to the U.S. Department of Housing and Urban Development.
The preliminary site plan by Doral-based Pascual, Perez, Kiliddjian & Star Architects and Planners shows home lots ranging from 8,600 to 12,800 square feet, but no major community amenity center. The developer has yet to submit home designs for the project, but that won’t be required until later in the process.
The rezoning application would need County Commission approval. Miami-based attorney Amanda M. Naldjieff, who represents Lennar in the application, couldn’t be reached for comment.
Lennar is the largest homebuilder in South Florida, and southern Miami-Dade is one of its most active areas in the tri-county area. During Lennar’s June 18 second quarter earnings call, BTIG analyst Carl Reichardt asked Lennar President and co-CEO Jon Jaffe about pricing and the need for incentives in Florida’s housing market.
“As we saw in most of Florida, markets continued strength, particularly from southeast Florida up the eastern coast of Florida,” Jaffe responded. “We saw very strong year-over-year growth in our pace, which indicates that the underpinnings of the market demand are there.”
Nationwide, Lennar sold homes at lower prices during the second quarter and offered more incentives, such as interest rate reductions using its financing platform, to offset pressure from higher interest rates. Lennar delivered 19,690 homes during the second quarter – up from 17,885 deliveries in the same period a year ago, but short of analyst expectations.
Meanwhile, Lennar has moved to a “land light” strategy that has it purchasing land shortly before it’s ready for vertical construction, instead of early in the process, with the company relying on private equity-funded land banks to buy the land up front. It has repeatedly used that strategy in south Miami-Dade.
During the second quarter conference call, Lennar Executive Chairman and co-CEO Stuart A. Miller said he hopes to package $6 billion to $8 billion of the company’s land into new company and spin it off into another public company. Lennar submitted a draft registration statement to the SEC for this company a few weeks ago.
“The goal of the spinoff is to accelerate our land-light strategy, which would allow for off-balance sheet treatment of the land assets,” Miller said during the earnings call. “We are excited about the opportunities that we believe the spinoff will bring us to the innovations that we have developed for the operation of the spun-off entity. Following the spinoff, the new public company will be completely independent from Lennar. Lennar will have option purchase agreements to purchase back finished homesites on a just-in-time basis.”