UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 31, ~~2020~~2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from _______ To _______

Commission File Number: 1-11749

Lennar Corporation

(Exact name of registrant as specified in its charter)


Delaware	95-4337490
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

700 Northwest 107th Avenue, Miami, Florida 33172

(Address of principal executive offices) (Zip Code)

(305) 559-4000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $.10	LEN	New York Stock Exchange
Class B Common Stock, par value $.10	LEN.B	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý☑ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý☑ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

ýR

Accelerated filer

Emerging growth company

☐

Non-accelerated filer

Smaller reporting company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý☑

Common stock outstanding as of May 31, ~~2020:~~2021:

Class A ~~274,618,334~~274,694,829

Class B ~~37,623,183~~37,621,152

LENNAR CORPORATION

FORM 10-Q

For the period ended May 31, ~~2020~~2021

Part I

Financial Information

Item 1.

Financial Statements

Condensed Consolidated Balance Sheets as of May 31, ~~2020~~2021 and November 30, ~~2019~~2020

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended May 31, ~~2020~~2021 and ~~2019~~2020

Condensed Consolidated Statements of Cash Flows for the three and six months ended Ma y May 31,~~, 2020~~ 2021 and ~~2019~~2020

Notes to Condensed Consolidated Financial Statements

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

3726

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

5642

Item 4.

Controls and Procedures

Part II

Item 1.

Item 1A.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

Item 3 - 5.

Item 6.

Part I. Financial Information

Item 1. Financial Statements

Lennar Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

(Dollars in thousands)

(unaudited)


		May 31,		November 30,		May 31,		November 30,
		2020 (1)		2019 (1)		2021 (1)		2020 (1)
ASSETS	ASSETS				ASSETS
Homebuilding:	Homebuilding:				Homebuilding:
Cash and cash equivalents	Cash and cash equivalents	$	1,398,682	1,200,832	Cash and cash equivalents	$	2,581,583	2,703,986
Restricted cash	Restricted cash	9,569		9,698	Restricted cash	35,637		15,211
Receivables, net	Receivables, net	299,494		329,124	Receivables, net	353,910		298,671
Inventories:	Inventories:				Inventories:
Finished homes and construction in progress	Finished homes and construction in progress	9,609,146		9,195,721	Finished homes and construction in progress	10,418,116		8,593,399
Land and land under development	Land and land under development	7,938,451		8,267,647	Land and land under development	7,090,880		7,495,262
Consolidated inventory not owned	Consolidated inventory not owned	399,809		313,139	Consolidated inventory not owned	910,003		836,567
Total inventories	Total inventories	17,947,406		17,776,507	Total inventories	18,418,999		16,925,228
Investments in unconsolidated entities	Investments in unconsolidated entities	973,044		1,009,035	Investments in unconsolidated entities	1,010,256		953,177
Goodwill	Goodwill	3,442,359		3,442,359	Goodwill	3,442,359		3,442,359
Other assets	Other assets	1,080,186		1,021,684	Other assets	1,030,681		1,190,793
		25,150,740		24,789,239		26,873,425		25,529,425
Financial Services	Financial Services	2,577,805		3,006,024	Financial Services	2,066,674		2,708,118
Multifamily	Multifamily	1,127,929		1,068,831	Multifamily	1,209,270		1,175,908
Lennar Other	Lennar Other	452,551		495,417	Lennar Other	1,073,858		521,726
Total assets	Total assets	$	29,309,025	29,359,511	Total assets	$	31,223,227	29,935,177

(1)Under certain provisions of Accounting Standards Codification ("ASC") Topic 810, Consolidations, ("ASC 810"), the Company is required to separately disclose on its condensed consolidated balance sheets the assets owned by consolidated variable interest entities ("VIEs") and liabilities of consolidated VIEs as to which neither Lennar Corporation, ornor any of its subsidiaries, has any obligations.

As of May 31, ~~2020,~~2021, total assets include ~~$873.0~~$940.6 million related to consolidated VIEs of which ~~$9.1~~$39.0 million is included in Homebuilding cash and cash equivalents, ~~$0.2~~$15.3 million in Homebuilding ~~receivables, net, $110.6~~restricted cash, $14.3 million in Homebuilding finished homes and construction in progress, ~~$308.4~~$564.7 million in Homebuilding land and land under development, ~~$391.6~~$260.6 million in Homebuilding consolidated inventory not owned, ~~$2.0~~$1.3 million in Homebuilding investments in unconsolidated entities, ~~$8.0~~$27.2 million in Homebuilding other assets and ~~$43.3~~$17.8 million in Multifamily assets.

As of November 30, ~~2019,~~2020, total assets include ~~$980.2 million~~$1.1 billion related to consolidated VIEs of which ~~$15.5~~$32.1 million is included in Homebuilding cash and cash equivalents, ~~$0.2~~$0.1 million in Homebuilding receivables, net, ~~$97.5~~$14.2 million in Homebuilding finished homes and construction in progress, ~~$283.2~~$486.8 million in Homebuilding land and land under development, ~~$301.0~~$426.3 million in Homebuilding consolidated inventory not owned, ~~$2.5~~$1.6 million in Homebuilding investments in unconsolidated entities, ~~$10.0~~$120.6 million in Homebuilding other assets ~~$221.2 million in Financial Services assets~~ and ~~$49.1~~$39.9 million in Multifamily assets.

See accompanying notes to condensed consolidated financial statements.

Lennar Corporation and Subsidiaries

Condensed Consolidated Balance Sheets (Continued)

(In thousands, except ~~shares and per~~ share amounts)

(unaudited)


		May 31,		November 30,		May 31,		November 30,
		2020 (2)		2019 (2)		2021 (2)		2020 (2)
LIABILITIES AND EQUITY	LIABILITIES AND EQUITY				LIABILITIES AND EQUITY
Homebuilding:	Homebuilding:				Homebuilding:
Accounts payable	Accounts payable	$	1,033,558	1,069,179	Accounts payable	$	1,171,358	1,037,338
Liabilities related to consolidated inventory not owned	Liabilities related to consolidated inventory not owned	344,074		260,266	Liabilities related to consolidated inventory not owned	769,225		706,691
Senior notes and other debts payable, net	Senior notes and other debts payable, net	7,495,674		7,776,638	Senior notes and other debts payable, net	5,894,342		5,955,758
Other liabilities	Other liabilities	1,900,970		1,900,955	Other liabilities	2,281,508		2,225,864
		10,774,276		11,007,038		10,116,433		9,925,651
Financial Services	Financial Services	1,663,548		2,056,450	Financial Services	1,084,838		1,644,248
Multifamily	Multifamily	222,387		232,155	Multifamily	255,327		252,911
Lennar Other	Lennar Other	16,190		30,038	Lennar Other	64,531		12,966
Total liabilities	Total liabilities	12,676,401		13,325,681	Total liabilities	11,521,129		11,835,776
Stockholders’ equity:	Stockholders’ equity:				Stockholders’ equity:
Preferred stock	Preferred stock	—		—	Preferred stock	0		0
Class A common stock of $0.10 par value; Authorized: May 31, 2020 and November 30, 2019 - 400,000,000 shares; Issued: May 31, 2020 - 298,037,274 shares and November 30, 2019 - 297,119,153 shares		29,804		29,712
Class B common stock of $0.10 par value; Authorized: May 31, 2020 and November 30, 2019 - 90,000,000 shares; Issued: May 31, 2020 - 39,443,104 shares and November 30, 2019 - 39,443,064 shares		3,944		3,944
Class A common stock of $0.10 par value; Authorized: May 31, 2021 and November 30, 2020 - 400,000,000 shares; Issued: May 31, 2021 - 300,486,193 shares and November 30, 2020 - 298,942,836 shares					Class A common stock of $0.10 par value; Authorized: May 31, 2021 and November 30, 2020 - 400,000,000 shares; Issued: May 31, 2021 - 300,486,193 shares and November 30, 2020 - 298,942,836 shares	30,049		29,894
Class B common stock of $0.10 par value; Authorized: May 31, 2021 and November 30, 2020 - 90,000,000 shares; Issued: May 31, 2021 - 39,443,168 shares and November 30, 2020 - 39,443,168 shares					Class B common stock of $0.10 par value; Authorized: May 31, 2021 and November 30, 2020 - 90,000,000 shares; Issued: May 31, 2021 - 39,443,168 shares and November 30, 2020 - 39,443,168 shares	3,944		3,944
Additional paid-in capital	Additional paid-in capital	8,630,442		8,578,219	Additional paid-in capital	8,755,020		8,676,056
Retained earnings	Retained earnings	9,132,714		8,295,001	Retained earnings	12,241,400		10,564,994
Treasury stock, at cost; May 31, 2020 - 23,418,940 shares of Class A common stock and 1,819,921 shares of Class B common stock; November 30, 2019 - 18,964,973 shares of Class A common stock and 1,704,630 shares of Class B common stock		(1,253,863)		(957,857)
Accumulated other comprehensive income (loss)		(338)		498
Treasury stock, at cost; May 31, 2021 - 25,791,364 shares of Class A common stock and 1,822,016 shares of Class B common stock; November 30, 2020 - 23,864,589 shares of Class A common stock and 1,822,016 shares of Class B common stock					Treasury stock, at cost; May 31, 2021 - 25,791,364 shares of Class A common stock and 1,822,016 shares of Class B common stock; November 30, 2020 - 23,864,589 shares of Class A common stock and 1,822,016 shares of Class B common stock	(1,452,874)		(1,279,227)
Accumulated other comprehensive loss					Accumulated other comprehensive loss	(1,431)		(805)
Total stockholders’ equity	Total stockholders’ equity	16,542,703		15,949,517	Total stockholders’ equity	19,576,108		17,994,856
Noncontrolling interests	Noncontrolling interests	89,921		84,313	Noncontrolling interests	125,990		104,545
Total equity	Total equity	16,632,624		16,033,830	Total equity	19,702,098		18,099,401
Total liabilities and equity	Total liabilities and equity	$	29,309,025	29,359,511	Total liabilities and equity	$	31,223,227	29,935,177

(2)Under certain provisions of ASC 810, the Company is required to separately disclose on its condensed consolidated balance sheets the assets owned by consolidated VIEs and liabilities of consolidated VIEs as to which neither Lennar Corporation, ornor any of its subsidiaries, has any obligations.

As of May 31, ~~2020,~~2021, total liabilities include ~~$450.4~~$340.1 million related to consolidated VIEs as to which there was no recourse against the Company, of which ~~$20.9~~$24.4 million is included in Homebuilding accounts payable, ~~$335.5~~$218.9 million in Homebuilding liabilities related to consolidated inventory not owned, ~~$74.5~~$85.7 million in Homebuilding senior notes and other debts payable ~~$8.6~~and $11.1 million in Homebuilding other ~~liabilities and $11.0 million in Multifamily~~ liabilities.

As of November 30, ~~2019,~~2020, total liabilities include ~~$549.7~~$528.5 million related to consolidated VIEs as to which there was no recourse against the Company, of which ~~$13.7~~$28.4 million is included in Homebuilding accounts payable, ~~$247.5~~$351.4 million in Homebuilding liabilities related to consolidated inventory not owned, ~~$47.1~~$129.1 million in Homebuilding senior notes and other debt payable, ~~$8.9~~$9.9 million in Homebuilding other liabilities ~~$231.1 million in Financial Services liabilities~~ and ~~$1.4~~$9.8 million in Multifamily liabilities.

See accompanying notes to condensed consolidated financial statements.

Lennar Corporation and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(~~Dollars in~~In thousands, except per share amounts)

(unaudited)


		Three Months Ended				Six Months Ended					Three Months Ended		Six Months Ended
		May 31,				May 31,					May 31,		May 31,
		2020		2019	2020	2019		2021		2020	2021	2020
Revenues:	Revenues:						Revenues:
Homebuilding	Homebuilding	$	4,949,484	5,195,599	9,121,600	8,819,320	Homebuilding	$	6,028,041	4,949,484	10,971,097	9,121,600
Financial Services	Financial Services	196,263		204,216	394,924	347,527	Financial Services	218,747		196,263	462,816	394,924
Multifamily	Multifamily	123,117		147,412	255,734	244,806	Multifamily	177,473		123,117	308,916	255,734
Lennar Other	Lennar Other	18,509		15,663	20,452	19,319	Lennar Other	5,984		18,509	12,884	20,452
Total revenues	Total revenues	5,287,373		5,562,890	9,792,710	9,430,972	Total revenues	6,430,245		5,287,373	11,755,713	9,792,710
Costs and expenses:	Costs and expenses:						Costs and expenses:
Homebuilding	Homebuilding	4,313,331		4,587,259	8,011,137	7,826,094	Homebuilding	4,909,516		4,313,331	9,027,802	8,011,137
Financial Services	Financial Services	110,355		147,999	261,699	272,338	Financial Services	97,427		110,355	195,289	261,699
Multifamily	Multifamily	123,473		148,716	260,821	249,894	Multifamily	168,930		123,473	299,979	260,821
Lennar Other	Lennar Other	(1,072)		3,194	1,502	4,816	Lennar Other	5,732		(1,072)	9,984	1,502
Corporate general and administrative	Corporate general and administrative	83,451		76,113	170,298	155,456	Corporate general and administrative	90,717		78,183	201,248	160,817
Charitable foundation contribution							Charitable foundation contribution	14,493		5,268	26,807	9,481
Total costs and expenses	Total costs and expenses	4,629,538		4,963,281	8,705,457	8,508,598	Total costs and expenses	5,286,815		4,629,538	9,761,109	8,705,457
Homebuilding equity in earnings (loss) from unconsolidated entities		(9,100)		19,614	(13,646)	5,858
Homebuilding equity in loss from unconsolidated entities							Homebuilding equity in loss from unconsolidated entities	(1,688)		(9,100)	(6,253)	(13,646)
Homebuilding other income (expense), net	Homebuilding other income (expense), net	4,308		(46,165)	(5,058)	(47,700)	Homebuilding other income (expense), net	(4,362)		4,308	8,613	(5,058)
Financial Services gain on deconsolidation	Financial Services gain on deconsolidation	61,418		—	61,418	—	Financial Services gain on deconsolidation	0		61,418	0	61,418
Multifamily equity in earnings (loss) from unconsolidated entities and other gain	Multifamily equity in earnings (loss) from unconsolidated entities and other gain	(282)		(3,018)	6,234	7,563	Multifamily equity in earnings (loss) from unconsolidated entities and other gain	13,854		(282)	12,586	6,234
Lennar Other equity in earnings (loss) from unconsolidated entities		(26,642)		(4,978)	(26,523)	3,352
Lennar Other expense, net		(10,960)		(5,663)	(9,549)	(12,924)
Lennar Other realized and unrealized gain (loss)							Lennar Other realized and unrealized gain (loss)	(117,570)		0	352,175	0
Lennar Other equity in earnings (loss) from unconsolidated entities and other income (expense), net							Lennar Other equity in earnings (loss) from unconsolidated entities and other income (expense), net	63,221		(37,602)	62,174	(36,072)
Earnings before income taxes	Earnings before income taxes	676,577		559,399	1,100,129	878,523	Earnings before income taxes	1,096,885		676,577	2,423,899	1,100,129
Provision for income taxes	Provision for income taxes	(160,479)		(140,530)	(192,808)	(220,230)	Provision for income taxes	(260,113)		(160,479)	(570,218)	(192,808)
Net earnings (including net loss attributable to noncontrolling interests)		516,098		418,869	907,321	658,293
Less: Net loss attributable to noncontrolling interests		(1,308)		(2,603)	(8,537)	(3,089)
Net earnings (including net earnings (loss) attributable to noncontrolling interests)							Net earnings (including net earnings (loss) attributable to noncontrolling interests)	836,772		516,098	1,853,681	907,321
Less: Net earnings (loss) attributable to noncontrolling interests							Less: Net earnings (loss) attributable to noncontrolling interests	5,409		(1,308)	20,949	(8,537)
Net earnings attributable to Lennar	Net earnings attributable to Lennar	$	517,406	421,472	915,858	661,382	Net earnings attributable to Lennar	$	831,363	517,406	1,832,732	915,858
Other comprehensive income (loss), net of tax:	Other comprehensive income (loss), net of tax:						Other comprehensive income (loss), net of tax:
Net unrealized gain (loss) on securities available-for-sale	Net unrealized gain (loss) on securities available-for-sale	$	(338)	561	(384)	769	Net unrealized gain (loss) on securities available-for-sale	$	316	(338)	(626)	(384)
Reclassification adjustments for gains included in earnings, net of tax		(452)		(176)	(452)	(176)
Reclassification adjustments for loss included in earnings, net of tax							Reclassification adjustments for loss included in earnings, net of tax	0		(452)	0	(452)
Total other comprehensive income (loss), net of tax	Total other comprehensive income (loss), net of tax	$	(790)	385	(836)	593	Total other comprehensive income (loss), net of tax	$	316	(790)	(626)	(836)
Total comprehensive income attributable to Lennar	Total comprehensive income attributable to Lennar	$	516,616	421,857	915,022	661,975	Total comprehensive income attributable to Lennar	$	831,679	516,616	1,832,106	915,022
Total comprehensive loss attributable to noncontrolling interests		$	(1,308)	(2,603)	(8,537)	(3,089)
Total comprehensive income (loss) attributable to noncontrolling interests							Total comprehensive income (loss) attributable to noncontrolling interests	$	5,409	(1,308)	20,949	(8,537)
Basic earnings per share	Basic earnings per share	$	1.66	1.31	2.92	2.05	Basic earnings per share	$	2.66	1.66	5.86	2.92
Diluted earnings per share	Diluted earnings per share	$	1.65	1.30	2.91	2.03	Diluted earnings per share	$	2.65	1.65	5.85	2.91

See accompanying notes to condensed consolidated financial statements.

Lennar Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows ~~(Continued)~~

(In thousands)

(unaudited)


	Six Months Ended
	May 31,
	2021		2020
Cash flows from operating activities:
Net earnings (including net earnings (loss) attributable to noncontrolling interests)	$	1,853,681	907,321
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	44,743		44,464
Amortization of discount/premium and accretion on debt, net	(4,718)		(13,839)
Equity in (earnings) loss from unconsolidated entities	(67,618)		40,355
Distributions of earnings from unconsolidated entities	15,594		38,000
Share-based compensation expense	80,635		55,141

Deferred income tax expense	136,636		79,738

Loans held-for-sale unrealized loss	30,352		2,223
Lennar Other unrealized/realized gain	(352,175)		0
Gain on sale of other assets and operating properties and equipment	(18,596)		(13,126)

Gain on deconsolidation of previously consolidated entity	0		(61,418)

Gain on sale of interest in unconsolidated entity and other Multifamily gain	(1,167)		(4,661)
Gain on sale of Financial Services' portfolio/businesses	(2,528)		(5,014)


Valuation adjustments and write-offs of option deposits and pre-acquisition costs	13,576		65,098
Changes in assets and liabilities:

Decrease (increase) in receivables	117,910		(7,758)
Increase in inventories, excluding valuation adjustments and write-offs of option deposits and pre-acquisition costs	(1,576,420)		(159,138)
Increase in other assets	(180,914)		(148,087)
Decrease in loans held-for-sale	444,413		479,360
Increase in accounts payable and other liabilities	184,716		12,144
Net cash provided by operating activities	718,120		1,310,803
Cash flows from investing activities:

Net additions of operating properties and equipment	(24,362)		(25,731)
Proceeds from the sale of operating properties and equipment, other assets	32,002		29,727



Investments in and contributions to unconsolidated entities	(282,203)		(302,784)
Distributions of capital from unconsolidated entities	231,545		115,093







Proceeds from sale of investment in consolidated joint venture	15,950		0




Proceeds from sale of commercial mortgage-backed securities bonds	11,307		3,248
Proceeds from sale of Financial Services' portfolio/business	3,327		9,096
(Increase) decrease in Financial Services loans held-for-investment, net	(3,864)		143
Purchases of investment securities	(43,698)		(29,642)
Proceeds from maturities/sales of investment securities	9,916		25,138

Other receipts, net	8		1,670
Net cash used in investing activities	$	(50,072)	(174,042)

Six Months Ended
May 31,
2020 2019
Cash flows from operating activities:
Net earnings (including net loss attributable to noncontrolling interests) $ 907,321 658,293
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization 44,464 40,986
Amortization of discount/premium and accretion on debt, net (13,839) (13,335)
Equity in earnings (loss) from unconsolidated entities 40,355 (5,908)
Distributions of earnings from unconsolidated entities 38,000 4,037
Share-based compensation expense 55,141 31,390
Deferred income tax expense 79,738 101,477
Gain on sale of other assets, operating properties and equipment and real estate owned (13,126) (1,471)
Loss on consolidation — 48,874
Gain on deconsolidation of previously consolidated entity (61,418) —
Gain on sale of interest in unconsolidated entity and other Multifamily gain (4,661) (10,865)
Gain on sale of Financial Services' servicing portfolio/businesses (5,014) (2,168)
Valuation adjustments and write-offs of option deposits and pre-acquisition costs 65,098 10,602
Changes in assets and liabilities:
(Increase) decrease in receivables (7,758) 542,054
Increase in inventories, excluding valuation adjustments and write-offs of option deposits and pre-acquisition costs (159,138) (1,501,423)
(Increase) decrease in other assets (148,087) 66,464
Decrease (increase) in loans held-for-sale 481,583 (206,349)
Increase (decrease) in accounts payable and other liabilities 12,144 (192,548)
Net cash provided by (used in) operating activities 1,310,803 (429,890)
Cash flows from investing activities:
Net additions of operating properties and equipment (25,731) (47,766)
Proceeds from the sale of operating properties and equipment, other assets and real estate owned 29,727 4,210
Proceeds from sale of investment in unconsolidated entity — 17,790
Proceeds from sale of Financial Services' servicing portfolio/businesses 9,096 24,446
Investments in and contributions to unconsolidated entities/deconsolidation of previously consolidated entity (302,784) (230,744)
Distributions of capital from unconsolidated entities 115,093 140,888
Receipts of principal payments on loans receivable and other — 1,811
Proceeds from sale of commercial mortgage-backed securities bonds 3,248 —
Decrease (increase) in Financial Services loans held-for-investment, net 143 (5,975)
Purchases of investment securities (29,642) (31,462)
Proceeds from maturities/sales of investments securities 25,138 35,416
Other receipts (payments), net 1,670 (200)
Net cash used in investing activities $ (174,042) (91,586)

See accompanying notes to condensed consolidated financial statements.

Lennar Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows ~~(Continued)~~(continued)

(In thousands)

(unaudited)


		Six Months Ended						Six Months Ended
		May 31,						May 31,
		2020		2019		2021		2020
Cash flows from financing activities:	Cash flows from financing activities:				Cash flows from financing activities:
Net borrowings under revolving line of credit		$	—	550,000

Net repayments under warehouse facilities	Net repayments under warehouse facilities	(310,216)		(365,184)	Net repayments under warehouse facilities	$	(535,734)	(310,216)

Redemption of senior notes	Redemption of senior notes	(300,000)		—	Redemption of senior notes	0		(300,000)
Principal payments on notes payable and other borrowings					Principal payments on notes payable and other borrowings	(114,964)		(174,382)
Proceeds from other borrowings	Proceeds from other borrowings	59,139		28,620	Proceeds from other borrowings	13,973		59,139
Principal payments on notes payable and other borrowings		(174,382)		(123,681)
Proceeds from liabilities related to consolidated inventory not owned					Proceeds from liabilities related to consolidated inventory not owned	301,869		0

Proceeds (payments) related to other liabilities, net		3,567		(1,046)
Conversions, exchanges and redemption of convertible senior notes		—		(1,288)
Payments related to consolidated inventory not owned					Payments related to consolidated inventory not owned	(149,686)		0
Proceeds related to other liabilities, net					Proceeds related to other liabilities, net	0		3,567

Receipts related to noncontrolling interests	Receipts related to noncontrolling interests	169,061		8,937	Receipts related to noncontrolling interests	13,905		169,061
Payments related to noncontrolling interests	Payments related to noncontrolling interests	(21,501)		(23,317)	Payments related to noncontrolling interests	(17,226)		(21,501)

Common stock:	Common stock:				Common stock:
Issuances		—		634

Repurchases	Repurchases	(296,093)		(101,229)	Repurchases	(173,644)		(296,093)
Dividends	Dividends	(78,145)		(25,877)	Dividends	(156,326)		(78,145)
Net cash used in financing activities	Net cash used in financing activities	$	(948,570)	(53,431)	Net cash used in financing activities	$	(817,833)	(948,570)
Net increase (decrease) in cash and cash equivalents and restricted cash		188,191		(574,907)
Net (decrease) increase in cash and cash equivalents and restricted cash					Net (decrease) increase in cash and cash equivalents and restricted cash	(149,785)		188,191
Cash and cash equivalents and restricted cash at beginning of period	Cash and cash equivalents and restricted cash at beginning of period	1,468,691		1,595,978	Cash and cash equivalents and restricted cash at beginning of period	2,932,730		1,468,691
Cash and cash equivalents and restricted cash at end of period	Cash and cash equivalents and restricted cash at end of period	$	1,656,882	1,021,071	Cash and cash equivalents and restricted cash at end of period	$	2,782,945	1,656,882
Summary of cash and cash equivalents and restricted cash:	Summary of cash and cash equivalents and restricted cash:				Summary of cash and cash equivalents and restricted cash:
Homebuilding	Homebuilding	$	1,408,251	812,365	Homebuilding	$	2,581,583	1,398,682
Financial Services	Financial Services	229,621		186,760	Financial Services	130,528		224,229
Multifamily	Multifamily	13,061		16,743	Multifamily	22,395		13,061
Lennar Other	Lennar Other	5,949		5,203	Lennar Other	3,074		5,949
Homebuilding restricted cash					Homebuilding restricted cash	35,637		9,569
Financial Services restricted cash					Financial Services restricted cash	9,728		5,392
		$	1,656,882	1,021,071		$	2,782,945	1,656,882
Supplemental disclosures of non-cash investing and financing activities:	Supplemental disclosures of non-cash investing and financing activities:				Supplemental disclosures of non-cash investing and financing activities:
Homebuilding and Multifamily:	Homebuilding and Multifamily:				Homebuilding and Multifamily:
Purchases of inventories and other assets financed by sellers	Purchases of inventories and other assets financed by sellers	$	102,982	46,631	Purchases of inventories and other assets financed by sellers	$	138,963	102,982
Non-cash contributions to unconsolidated entities	Non-cash contributions to unconsolidated entities	13,859		—	Non-cash contributions to unconsolidated entities	20,423		13,859

Lennar Other (non-cash impacts from sale of solar platform):					Lennar Other (non-cash impacts from sale of solar platform):
Non-cash increase in investment in equity securities					Non-cash increase in investment in equity securities	$	127,094	0
Non-cash increase in receivables					Non-cash increase in receivables	64,683		0
Non-cash increase in other liabilities					Non-cash increase in other liabilities	(40,302)		0

Consolidation/deconsolidation of unconsolidated/consolidated entities, net:	Consolidation/deconsolidation of unconsolidated/consolidated entities, net:				Consolidation/deconsolidation of unconsolidated/consolidated entities, net:
Financial Services assets	Financial Services assets	$	217,565	—	Financial Services assets	$	0	217,565
Financial Services liabilities	Financial Services liabilities	(115,175)		—	Financial Services liabilities	0		(115,175)
Financial Services noncontrolling interests	Financial Services noncontrolling interests	(102,390)		—	Financial Services noncontrolling interests	0		(102,390)
Inventories	Inventories	(35,959)		187,506	Inventories	0		(35,959)
Receivables		—		102,959

Operating properties and equipment and other assets	Operating properties and equipment and other assets	6,375		53,412	Operating properties and equipment and other assets	0		6,375

Investments in unconsolidated entities		—		67,925

Notes payable		—		(383,212)

Other liabilities	Other liabilities	182		(19,696)	Other liabilities	0		182
Noncontrolling interests	Noncontrolling interests	29,402		(8,894)	Noncontrolling interests	0		29,402

See accompanying notes to condensed consolidated financial statements.

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited)

(1)Basis of Presentation

Basis of Consolidation

The accompanying condensed consolidated financial statements include the accounts of Lennar Corporation and all subsidiaries, partnerships and other entities in which Lennar Corporation has a controlling interest and variable interest entities ("VIEs") (see Note 10 of the Notes to the Condensed Consolidated Financial Statements) in which Lennar Corporation is deemed to be the primary beneficiary (the "Company"). The Company’s investments in both unconsolidated entities in which a significant, but less than controlling, interest is held and in VIEs in which the Company is not deemed to be the primary beneficiary, are accounted for by the equity method. All intercompany transactions and balances have been eliminated in consolidation. The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended November 30, ~~2019.~~2020. The basis of consolidation is unchanged from the disclosure in the Company's Notes to Consolidated Financial Statements section in its Form 10-K for the year ended November 30, 2020. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for the fair presentation of the accompanying condensed consolidated financial statements have been made.

The Company has historically experienced, and expects to continue to experience, variability in quarterly results. The condensed consolidated statements of operations for the three and six months ended May 31, ~~2020~~2021 are not necessarily indicative of the results to be expected for the full year.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Cash and Cash Equivalents

Homebuilding cash and cash equivalents as of May 31, ~~2020~~2021 and November 30, ~~2019~~2020 included ~~$528.3~~$678.8 million and ~~$565.8~~$314.3 million, respectively, of cash held in ~~escrow~~escrow. On average for ~~approximately three days.~~

~~Share-based Payments~~

~~During~~ the three months ended May 31, ~~2020,~~2021, cash was held in escrow for approximately four days.

Share-based Payments

During both the ~~Company granted an immaterial number of vested shares. During the six~~three months ended May 31, ~~2020, the Company granted employees 0.9 million nonvested shares. During the three~~2021 and ~~six months ended May 31, 2019,~~2020, the Company granted employees an immaterial number of nonvested shares. During the six months ended May 31, 2021 and 2020, the Company granted employees 1.4 million and 0.9 million nonvested shares, respectively.

Recently Adopted Accounting Pronouncements

In ~~March~~June 2016, the Financial Accounting Standards Board ("FASB") issued ~~ASU 2016-02, Leases~~Accounting Standard Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU ~~2016-02"~~2016-13")~~, which provides guidance~~. ASU 2016-13 significantly changes the impairment model for ~~accounting for leases.~~most financial assets and certain other instruments. ASU ~~2016-02~~2016-13 requires ~~lessees~~immediate recognition of estimated credit losses expected to classify leases as either finance or operating leases and to record a right-of-use (“ROU”) asset and a lease liability for all leases with a term greater than 12 months regardless of the lease classification. The lease classification determined whether the lease expense was recognized based on an effective interest rate method or on a straight line basisoccur over the ~~term~~remaining life of ~~the lease. Accounting~~many financial assets, which generally results in earlier recognition of allowances for ~~lessors remains largely unchanged from current GAAP.~~credit losses on loans and other financial instruments. ASU ~~2016-02~~2016-13 was effective for the ~~Company~~Company's fiscal year beginning December 1, ~~2019.~~2020. The ~~Company elected the available practical expedients on adoption. Additionally, in preparation for~~ adoption of ~~the standard, the Company has implemented internal controls and key system functionality to enable the preparation of financial information. The standard~~ASU 2016-13 did not have a material impact on ~~our~~the Company's condensed consolidated ~~statements~~financial statements.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Accounting for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 removes the requirement to perform a hypothetical purchase price allocation to measure goodwill impairment. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of ~~operations and comprehensive income (loss) or our~~goodwill. ASU 2017-04 was effective for the Company’s fiscal year beginning December 1, 2020. The adoption of ASU 2017-04 did not have a material impact on the Company's condensed consolidated financial statements.

New Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes ("ASU 2019-12"). ASU 2019-12 will be effective for the Company’s fiscal year beginning December 1, 2021. The Company is currently evaluating the impact the adoption of ASU 2019-12 will have on the Company's condensed consolidated financial statements.

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

Reclassifications

Certain prior year amounts in the condensed consolidated financial statements have been reclassified to conform with the 2021 presentation. The Company reclassed the balance of ~~cash flows. As a result~~its investment in Doma, formerly States Title, to which the Company sold the majority of the ~~adoption, on December 1,~~Financial Services segment's retail title agency business and title insurance underwriter in the first quarter of 2019, from the Financial Services segment to the Lennar Other segment in the Condensed Consolidated Balance Sheets for all periods presented. This was reclassed to be included in our strategic technology investments as the entity has announced that it will merge with a publicly traded special purpose acquisition company. In addition, the Company ~~recorded $150.7 million~~reflected its contributions to its charitable foundation in a new line on its Condensed Consolidated Statements of ~~ROU~~Operations for all periods presented. This was previously reflected in the Corporate general and administrative line. These reclassifications had no impact on the Company's total assets, ~~and $159.7 million of lease liabilities on~~total equity, revenues or net earnings in its condensed consolidated ~~balance sheets within other assets and other liabilities of the respective segments.~~financial statements.

(2)Operating and Reporting Segments

The Company's homebuilding operations construct and sell homes primarily for first-time, move-up and active adult homebuyers primarily under the Lennar brand name. In addition, the Company's homebuilding operations purchase, develop and sell land to third parties. The Company's chief operating decision makers manage and assess the Company’s performance at a regional level. Therefore, the Company performed an assessment of its operating segments in accordance with ASC 280, Segment Reporting, and determined that the following are its operating and reportable segments:

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

Homebuilding segments: (1) ~~Homebuilding~~ East

(2) ~~Homebuilding~~ Central

(3) ~~Homebuilding~~ Texas

(4) ~~Homebuilding~~ West

(5) Financial Services

(6) Multifamily

(7) Lennar Other

The assets and liabilities related to the Company’s segments were as follows:


(In thousands)	(In thousands)	May 31, 2020												(In thousands)	May 31, 2021
Assets:	Assets:	Homebuilding		Financial Services	Multifamily	Lennar Other	Total	Assets:	Homebuilding		Financial Services	Multifamily	Lennar Other		Total
Cash and cash equivalents	Cash and cash equivalents	$	1,398,682	224,229	13,061	5,949	1,641,921	Cash and cash equivalents	$	2,581,583	130,528	22,395	3,074		2,737,580
Restricted cash	Restricted cash	9,569		5,392	—	—	14,961	Restricted cash	35,637		9,728	0	0		45,365
Receivables, net (1)	Receivables, net (1)	299,494		594,620	87,183	—	981,297	Receivables, net (1)	353,910		422,117	111,802	0		887,829
Inventories	Inventories	17,947,406		—	328,497	—	18,275,903	Inventories	18,418,999		0	316,760	0		18,735,759
Loans held-for-sale (2)	Loans held-for-sale (2)	—		1,163,356	—	—	1,163,356	Loans held-for-sale (2)	0		1,015,438	0	0		1,015,438

Investments in equity securities (3)								Investments in equity securities (3)	0		0	0	544,993		544,993
Investments available-for-sale (4)								Investments available-for-sale (4)	0		0	0	41,563		41,563
Loans held-for-investment, net	Loans held-for-investment, net	—		69,846	—	1,422	71,268	Loans held-for-investment, net	0		77,680	0	0		77,680

Investments held-to-maturity	Investments held-to-maturity	—		164,982	—	—	164,982	Investments held-to-maturity	0		162,919	0	0		162,919
Investments available-for-sale (3)		—		—	—	53,585	53,585
Investments in unconsolidated entities (4)		973,044		70,844	621,465	380,105	2,045,458
Investments in unconsolidated entities								Investments in unconsolidated entities	1,010,256		0	691,330	379,236		2,080,822
Goodwill	Goodwill	3,442,359		189,699	—	—	3,632,058	Goodwill	3,442,359		189,699	0	0		3,632,058
Other assets (5)		1,080,186		94,837	77,723	11,490	1,264,236
Other assets								Other assets	1,030,681		58,565	66,983	104,992		1,261,221
		$	25,150,740	2,577,805	1,127,929	452,551	29,309,025		$	26,873,425	2,066,674	1,209,270	1,073,858		31,223,227
Liabilities:	Liabilities:							Liabilities:
Notes and other debts payable, net	Notes and other debts payable, net	$	7,495,674	1,435,538	—	6,170	8,937,382	Notes and other debts payable, net	$	5,894,342	928,185	0	1,906		6,824,433
Other liabilities (6)		3,278,602		228,010	222,387	10,020	3,739,019
Other liabilities								Other liabilities	4,222,091		156,653	255,327	62,625		4,696,696
		$	10,774,276	1,663,548	222,387	16,190	12,676,401		$	10,116,433	1,084,838	255,327	64,531		11,521,129

(In thousands) November 30, 2019
Assets: Homebuilding Financial
Services Multifamily Lennar
Other Total
Cash and cash equivalents $ 1,200,832 234,113 8,711 2,340 1,445,996
Restricted cash 9,698 12,022 — 975 22,695
Receivables, net (1) 329,124 500,847 76,906 — 906,877
Inventories 17,776,507 — 315,107 — 18,091,614
Loans held-for-sale (2) — 1,644,939 — — 1,644,939
Loans held-for-investment, net — 73,867 — — 73,867
Investments held-to-maturity — 190,289 — 54,117 244,406
Investments available-for-sale (3) — 3,732 48,206 — 51,938
Investments in unconsolidated entities (4) 1,009,035 — 561,190 403,688 1,973,913
Goodwill 3,442,359 215,516 — — 3,657,875
Other assets (5) 1,021,684 130,699 58,711 34,297 1,245,391
$ 24,789,239 3,006,024 1,068,831 495,417 29,359,511
Liabilities:
Notes and other debts payable, net $ 7,776,638 1,745,755 36,125 15,178 9,573,696
Other liabilities (6) 3,230,400 310,695 196,030 14,860 3,751,985
$ 11,007,038 2,056,450 232,155 30,038 13,325,681

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)


(In thousands)	November 30, 2020
Assets:	Homebuilding		Financial Services	Multifamily	Lennar Other	Total
Cash and cash equivalents	$	2,703,986	116,171	38,963	3,918	2,863,038
Restricted cash	15,211		54,481	0	0	69,692
Receivables, net (1)	298,671		552,779	86,629	0	938,079
Inventories	16,925,228		0	249,920	0	17,175,148
Loans held-for-sale (2)	0		1,490,105	0	0	1,490,105

Investments in equity securities (3)	0		0	0	68,771	68,771
Investments available-for-sale (4)	0		0	0	53,497	53,497
Loans held-for-investment, net	0		72,626	0	0	72,626
Investments held-to-maturity	0		164,230	0	0	164,230
Investments in unconsolidated entities	953,177		0	724,647	387,097	2,064,921
Goodwill	3,442,359		189,699	0	0	3,632,058
Other assets	1,190,793		68,027	75,749	8,443	1,343,012
	$	25,529,425	2,708,118	1,175,908	521,726	29,935,177
Liabilities:
Notes and other debts payable, net	$	5,955,758	1,463,919	0	1,906	7,421,583
Other liabilities	3,969,893		180,329	252,911	11,060	4,414,193
	$	9,925,651	1,644,248	252,911	12,966	11,835,776

(1)Receivables, net for Financial Services primarily related to loans sold to investors for which the Company had not yet been ~~paid as of May 31, 2020 and November 30, 2019, respectively.~~paid.

(2)Loans held-for-sale related to unsold residential and commercial loans carried at fair value.

~~Lennar Corporation~~(3)Investments in equity securities include investments of $83.8 million and ~~Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~$61.6 million without readily available fair values as of May 31, 2021 and November 30, 2020, respectively.

~~(3)~~(4)Investments available-for-sale are carried at fair value with changes in fair value recorded as a component of accumulated other comprehensive income (loss) on the condensed consolidated balance sheet.

~~(4)~~Lennar Other investments in unconsolidated entities decreased primarily due to a $25.0 million write-down of assets held by Rialto legacy funds because of disruption in the capital markets as a result of COVID-19 and the economic shutdown.

~~(5)~~As of May 31, 2020 and November 30, 2019, Financial Services other assets included mortgage loan commitments carried at fair value of $45.0 million and $16.3 million, respectively, and mortgage servicing rights carried at fair value of $1.2 million and $24.7 million, respectively.

~~(6)~~As of May 31, 2020 and November 30, 2019, Financial Services other liabilities included $62.4 million and $60.7 million, respectively, of certain of the Company’s self-insurance reserves related to construction defects, general liability and workers’ compensation. In addition, as of May 31, 2020 and November 30, 2019, Financial Services other liabilities also included forward contracts carried at fair value of $4.7 million and $3.9 million, respectively.

Financial information relating to the Company’s segments was as follows:


		Three Months Ended May 31, 2020														Three Months Ended May 31, 2021
(In thousands)	(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate and unallocated	Total	(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate and unallocated	Total
Revenues	Revenues	$	4,949,484	196,263	123,117	18,509	—	5,287,373	Revenues	$	6,028,041	218,747	177,473	5,984	0	6,430,245
Operating earnings (loss) (1)		631,361		147,326	(638)	(18,021)	—	760,028
Operating earnings (loss)									Operating earnings (loss)	1,112,475		121,320	22,397	(54,097)	0	1,202,095
Corporate general and administrative expenses	Corporate general and administrative expenses	—		—	—	—	83,451	83,451	Corporate general and administrative expenses	0		0	0	0	90,717	90,717
Charitable foundation contribution									Charitable foundation contribution	0		0	0	0	14,493	14,493
Earnings (loss) before income taxes	Earnings (loss) before income taxes	631,361		147,326	(638)	(18,021)	(83,451)	676,577	Earnings (loss) before income taxes	1,112,475		121,320	22,397	(54,097)	(105,210)	1,096,885

		Three Months Ended May 31, 2019														Three Months Ended May 31, 2020
Revenues	Revenues	$	5,195,599	204,216	147,412	15,663	—	5,562,890	Revenues	$	4,949,484	196,263	123,117	18,509	0	5,287,373
Operating earnings (loss)	Operating earnings (loss)	581,789		56,217	(4,322)	1,828	—	635,512	Operating earnings (loss)	631,361		147,326	(638)	(18,021)	0	760,028
Corporate general and administrative expenses	Corporate general and administrative expenses	—		—	—	—	76,113	76,113	Corporate general and administrative expenses	0		0	0	0	78,183	78,183
Charitable foundation contribution									Charitable foundation contribution	0		0	0	0	5,268	5,268
Earnings (loss) before income taxes	Earnings (loss) before income taxes	581,789		56,217	(4,322)	1,828	(76,113)	559,399	Earnings (loss) before income taxes	631,361		147,326	(638)	(18,021)	(83,451)	676,577

Six Months Ended May 31, 2020
(In thousands) Homebuilding Financial Services Multifamily Lennar Other Corporate and
unallocated Total
Revenues $ 9,121,600 394,924 255,734 20,452 — 9,792,710
Operating earnings (loss) (1) 1,091,759 194,643 1,147 (17,122) — 1,270,427
Corporate general and administrative expenses — — — — 170,298 170,298
Earnings (loss) before income taxes 1,091,759 194,643 1,147 (17,122) (170,298) 1,100,129
Six Months Ended May 31, 2019
Revenues $ 8,819,320 347,527 244,806 19,319 — 9,430,972
Operating earnings 951,384 75,189 2,475 4,931 — 1,033,979
Corporate general and administrative expenses — — — — 155,456 155,456
Earnings before income taxes 951,384 75,189 2,475 4,931 (155,456) 878,523

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

~~(1)~~
Operating loss for Lennar Other for both the three and six months ended May 31, 2020 included a $25.0 million write-down of assets held by Rialto legacy funds because of disruption in the capital markets as a result of COVID-19 and the economic shutdown.


	Six Months Ended May 31, 2021
(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate and unallocated	Total
Revenues	$	10,971,097	462,816	308,916	12,884	0	11,755,713
Operating earnings	1,945,655		267,527	21,523	417,249	0	2,651,954
Corporate general and administrative expenses	0		0	0	0	201,248	201,248
Charitable foundation contribution	0		0	0	0	26,807	26,807
Earnings (loss) before income taxes	1,945,655		267,527	21,523	417,249	(228,055)	2,423,899

	Six Months Ended May 31, 2020
Revenues	$	9,121,600	394,924	255,734	20,452	0	9,792,710
Operating earnings (loss)	1,091,759		194,643	1,147	(17,122)	0	1,270,427
Corporate general and administrative expenses	0		0	0	0	160,817	160,817
Charitable foundation contribution	0		0	0	0	9,481	9,481
Earnings (loss) before income taxes	1,091,759		194,643	1,147	(17,122)	(170,298)	1,100,129

Homebuilding Segments

Information about homebuilding activities in states which are not economically similar to other states in the same geographic area is grouped under "Homebuilding Other," which is not considered a reportable segment.

Evaluation of segment performance is based primarily on operating earnings (loss) before income taxes. Operations of the Company’s Homebuilding segments primarily include the construction and sale of single-family attached and detached homes as well as the purchase, development and sale of residential land directly and through the Company’s unconsolidated entities. Operating earnings (loss) for the Homebuilding segments consist of revenues generated from the sales of homes and land, other revenues from management fees and forfeited deposits, equity in earnings (loss) from unconsolidated entities and other income

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

(expense), net, less the cost of homes sold and land sold, and selling, general and administrative expenses incurred by the segment.

The Company’s reportable Homebuilding segments and all other homebuilding operations not required to be reported separately have homebuilding divisions located in:

East: Florida, New Jersey, ~~North Carolina,~~ Pennsylvania and South Carolina

Central: Georgia, Illinois, Indiana, Maryland, Minnesota, North Carolina and Virginia

Texas: Texas

West: Arizona, California, Colorado, Idaho, Nevada, Oregon, Utah and Washington

Other: Urban divisions and other homebuilding related investments primarily in California, including FivePoint Holdings, LLC ("FivePoint")

The assets related to the Company’s homebuilding segments were as follows:

(In thousands)
Assets: East Central Texas West Other Corporate and Unallocated Total Homebuilding
Balance at May 31, 2020 $ 6,676,730 2,664,309 2,305,777 10,815,820 1,143,132 1,544,972 25,150,740
Balance at November 30, 2019 $ 6,708,586 2,732,872 2,246,893 10,663,666 1,173,163 1,264,059 24,789,239



(In thousands)	East		Central	Texas	West	Other	Corporate and Unallocated	Total Homebuilding
May 31, 2021	$	5,749,998	3,713,952	2,510,950	11,131,940	1,326,516	2,440,069	26,873,425
November 30, 2020	5,308,114		3,438,600	2,150,916	10,504,374	1,301,618	2,825,803	25,529,425

Financial information relating to the Company’s homebuilding segments was as follows:


	Three Months Ended May 31, 2021
(In thousands)	East		Central	Texas	West	Other	Total Homebuilding
Revenues	$	1,567,768	1,097,582	799,259	2,553,771	9,661	6,028,041
Operating earnings (loss)	309,827		159,048	176,057	492,811	(25,268)	1,112,475

	Three Months Ended May 31, 2020
Revenues	$	1,277,431	986,284	712,756	1,959,823	13,190	4,949,484
Operating earnings (loss)	192,887		103,904	99,887	280,094	(45,411)	631,361

Three Months Ended May 31, 2020
(In thousands) East Central Texas West Other Total Homebuilding
Revenues $ 1,577,716 685,999 712,756 1,959,823 13,190 4,949,484
Operating earnings (loss) 229,726 67,065 99,887 280,094 (45,411) 631,361
Three Months Ended May 31, 2019
Revenues $ 1,737,342 613,785 693,212 2,143,023 8,237 5,195,599
Operating earnings (loss) 210,464 55,344 75,374 272,904 (32,297) 581,789

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)


		Six Months Ended May 31, 2020														Six Months Ended May 31, 2021
(In thousands)	(In thousands)	East		Central	Texas	West	Other	Total Homebuilding	(In thousands)	East		Central	Texas	West	Other	Total Homebuilding
Revenues	Revenues	$	2,984,582	1,220,975	1,185,984	3,708,592	21,467	9,121,600	Revenues	$	2,923,710	2,026,024	1,443,337	4,563,350	14,676	10,971,097
Operating earnings (loss)	Operating earnings (loss)	404,731		96,537	152,960	505,001	(67,470)	1,091,759	Operating earnings (loss)	571,910		291,071	305,700	814,517	(37,543)	1,945,655

		Six Months Ended May 31, 2019														Six Months Ended May 31, 2020
Revenues	Revenues	$	2,964,155	1,048,852	1,111,729	3,683,920	10,664	8,819,320	Revenues	$	2,429,763	1,775,794	1,185,984	3,708,592	21,467	9,121,600
Operating earnings (loss)	Operating earnings (loss)	345,847		86,270	107,652	463,565	(51,950)	951,384	Operating earnings (loss)	341,641		159,627	152,960	505,001	(67,470)	1,091,759

Financial Services

Operations of the Financial Services segment include primarily mortgage financing, title and closing services primarily for buyers of the Company’s homes. It also includes originating and selling into securitizations commercial mortgage loans through its LMF Commercial business, formerly Rialto Mortgage Finance. The Financial Services segment sells substantially all of the loans it originates within a short period of time in the secondary mortgage market, the majority of which are sold on a servicing released, non-recourse basis. After the loans are sold, the Company retains potential liability for possible claims by purchasers that it breached certain limited industry-standard representations and warranties in the loan sale agreements.business. Financial Services’ operating earnings consist of revenues generated primarily from mortgage financing, title and closing services, and property and casualty insurance, less the cost of such services and certain selling, general and administrative expenses incurred by the segment. The Financial Services segment operates generally in the same states as the Company’s homebuilding operations.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

At May 31, ~~2020,~~2021, the Financial Services warehouse facilities were all 364-day repurchase facilities and were used to fund residential mortgages or commercial mortgages for LMF Commercial as follows:


(In thousands)	Maximum Aggregate Commitment
Residential facilities maturing:
June ~~2020~~2021 (1)	$	~~500,000~~600,000
July ~~2020~~2021	~~300,000~~200,000
~~January~~December 2021	500,000
~~March 2021~~April 2022	~~300,000~~100,000
Total - Residential facilities	$	~~1,600,000~~1,400,000
LMF Commercial facilities ~~maturing:~~maturing
November ~~2020~~2021	$	~~200,000~~100,000
December ~~2020~~2021 (2)	~~700,000~~611,438



Total - LMF Commercial facilities	$	~~900,000~~711,438
Total	$	~~2,500,000~~2,111,438

(1)Subsequent to May 31, ~~2020,~~2021, the maturity due date was extended to ~~June~~July 2021.

(2)Includes ~~$50.0~~$11.4 million ~~LMF Commercial~~ warehouse repurchase facility used by LMF Commercial to finance the origination of floating rate accrual loans, which are reported as accrual loans within loans held-for-investment, net. ~~There were borrowings under this facility of $11.4 million as of May 31, 2020.~~

The Financial Services segment uses the residential facilities to finance its residential lending activities until the mortgage loans are sold to investors and the proceeds are collected. The facilities are non-recourse to the Company and are expected to be renewed or replaced with other facilities when they mature. The LMF Commercial facilities finance LMF Commercial loan originations and securitization activities and were secured by ~~a 75%~~up to an 80% interest in the originated commercial loans financed.

Borrowings and collateral under the facilities and their prior year predecessors were as follows:


(In thousands)	(In thousands)	May 31, 2020		November 30, 2019		(In thousands)	May 31, 2021		November 30, 2020
Borrowings under the residential facilities	Borrowings under the residential facilities	$	1,054,588	$	1,374,063	Borrowings under the residential facilities	$	671,541	1,185,797
Collateral under the residential facilities	Collateral under the residential facilities	1,085,503		1,423,650		Collateral under the residential facilities	695,275		1,231,619
Borrowings under the LMF Commercial facilities	Borrowings under the LMF Commercial facilities	227,003		216,870		Borrowings under the LMF Commercial facilities	104,247		124,617

If the facilities are not renewed or replaced, the borrowings under the lines of credit will be repaid by selling the mortgage loans held-for-sale to investors and by collecting receivables on loans sold but not yet paid for. Without the facilities, the Financial Services segment would have to use cash from operations and other funding sources to finance its lending activities.

Substantially all of the residential loans the Financial Services segment originates are sold within a short period in the secondary mortgage market on a servicing released, non-recourse basis. After the loans are sold, the Company retains potential liability for possible claims by purchasers that it breached certain limited industry-standard representations and warranties in the loan sale agreements. Purchasers sometimes try to defray losses by purporting to have found inaccuracies related to sellers’ representations and warranties in particular loan sale agreements. Mortgage investors could seek to have the Company buy back mortgage loans or compensate them for losses incurred on mortgage loans that the Company has sold based on claims that the Company breached its limited representations or warranties. The Company’s mortgage operations have established accruals for

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

possible losses associated with mortgage loans previously originated and sold to investors. The Company establishes accruals for such possible losses based upon, among other things, an analysis of repurchase requests received, an estimate of potential repurchase claims not yet received and actual past repurchases and losses through the disposition of affected loans as well as previous settlements. While the Company believes that it has adequately reserved for known losses and projected repurchase requests, given the volatility in the residential mortgage industry and the uncertainty regarding the ultimate resolution of these claims, if either actual repurchases or the losses incurred resolving those repurchases exceed the Company’s expectations, additional recourse expense may be incurred. Loan origination liabilities are included in Financial Services’ liabilities in the Company's condensed consolidated balance sheets.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

The activity in the Company’s loan origination liabilities was as follows:

Three Months Ended Six Months Ended
May 31, May 31,
(In thousands) 2020 2019 2020 2019
Loan origination liabilities, beginning of period $ 9,996 6,697 9,364 48,584
Provision for losses 1,139 914 1,915 1,587
Payments/settlements (255) (187) (399) (42,747)
Loan origination liabilities, end of period $ 10,880 7,424 10,880 7,424


	Three Months Ended			Six Months Ended
	May 31,			May 31,
(In thousands)	2021		2020	2021	2020
Loan origination liabilities, beginning of period	$	8,433	9,996	7,569	9,364
Provision for losses	1,114		1,139	2,080	1,915


Payments/settlements	(93)		(255)	(195)	(399)
Loan origination liabilities, end of period	$	9,454	10,880	9,454	10,880

LMF Commercial - loans held-for-sale

LMF Commercial originated commercial loans as follows:


	Three Months Ended			Six Months Ended
	May 31,			May 31,
(Dollars in thousands)	2021		2020	2021	2020
Originations (1)	$	196,498	5,400	415,998	417,650


Sold	155,740		142,938	438,705	457,377
Securitizations	1		1	3	3

(1)During both the three and six months ended May 31, 2021 and 2020 ~~LMF Commercial originated~~all the commercial loans ~~with a total principal balance of $417.7 million, all of which~~originated were recorded as loans held-for-sale, and sold $457.4 million of commercial loans into 3 separate securitizations. As of May 31, 2020, $146.4 million of originated commercial loans were sold into a securitization trust but not settled and thus were included as receivables, net.

~~During the six months ended May 31, 2019, LMF Commercial originated commercial loans with a total principal balance of $720.6 million, of~~ which $705.3 million were recorded as loans held-for-sale, and sold $500.5 million of commercial loans into 5 separate securitizations. As of May 31, 2019, $61.0 million of originated loans were sold into a securitization trust but not settled and thus were included as receivables, net.are held at fair value.

Investments held-to-maturity

At May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, the ~~carrying value of~~ Financial ~~Services'~~Services segment held commercial mortgage-backed securities ("CMBS") ~~was $164.9 million and $166.0 million, respectively.~~. These securities ~~were purchased at discounts ranging from 6%~~are classified as held-to-maturity based on its intent and ability to ~~84% with coupon rates ranging from 2.0% to 5.3%, stated~~hold the securities until maturity and ~~assumed final distribution dates between October 2027 and December 2028, and stated maturity dates between October 2050 and December 2051. The Financial Services segment reviews~~ changes in estimated cash flows are reviewed periodically to determine if an other-than-temporary impairment has ~~occurred on its CMBS.~~occurred. Based on the segment’s assessment, 0 impairment charges were recorded during either the three or six months ended May 31, ~~2020~~2021 or ~~May 31, 2019. The Financial Services segment classifies these securities as held-to-maturity based on its intent and ability to hold the securities until maturity.~~2020. The Company has financing agreements to finance CMBS that have been purchased as investments by the Financial Services segment. At May 31, 2020 and November 30, 2019, the carrying amount, net of debt issuance costs, of outstanding debt in these agreements was $153.9 million and $154.7 million, respectively, and interest is incurred at a rate of 3.4%.

Details related to Financial Services' CMBS were as follows:


(Dollars in thousands)	May 31, 2021			November 30, 2020
Carrying value	$	162,919		164,230
Outstanding debt, net of debt issuance costs	152,396			153,505
Incurred interest rate	3.4		%	3.4	%


	May 31, 2021
Discount rates at purchase	6%	—	84%
Coupon rates	2.0%	—	5.3%
Distribution dates	October 2027	—	December 2028
Stated maturity dates	October 2050	—	December 2051

Multifamily

The Company is actively involved, primarily through unconsolidated entities, in the development, construction and property management of multifamily rental properties. The Multifamily segment focuses on developing a geographically diversified portfolio of institutional quality multifamily rental properties in select U.S. markets.

Operations of the Multifamily segment include revenues generated from the sales of land, revenue from construction activities, and management and promote fees generated from joint ventures and equity in earnings (loss) from unconsolidated entities and other gains (which includes sales of buildings), less the cost of sales of land sold, expenses related to construction activities and general and administrative expenses.

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

Lennar Other

Lennar Other primarily includes strategic investments in technology companies, primarily managed by the Company's LENX subsidiary, and fund interests the Company retained when it sold the Rialto asset and investment management ~~platform, as well as strategic investments in technology companies.~~platform. Operations of the Lennar Other segment include operating earnings (loss) consisting of revenues generated primarily from the Company's share of carried interests in the Rialto fund investments retained after the sale of Rialto's asset and investment management platform, along with equity in earnings (loss) from the Rialto fund investments and strategic technology investments, gains (losses) from investments in equity securities and other income (expense), net from the remaining assets related to the Company's former Rialto segment.

During the three months ended May 31, 2021, the Company completed the sale of the Company's residential solar business to Sunnova Energy International Inc. ("Sunnova") for shares in Sunnova. The Company recorded a gain of $151.5 million upon the closing of the sale. The calculation of the gain included the fair value of the 3.1 million shares in initial consideration received at closing and the fair value of potential shares to be received upon achievement of earnouts. The significant unobservable fair value assumptions used in the calculation were a terminal value multiple of 3 and a 15% discount rate. The fair value of the earnouts was also based on the probability of achieving full or partial earnouts.

The investments in Opendoor Technologies, Inc ("Opendoor") and Sunnova are held at market and will therefore change depending on the value of the Company's share holdings on the last day of each quarter. During the three months ended May 31, 2021, the Company's Lennar Other segment recorded a loss of $234.3 million and $38.3 million related to the mark to market of the Company's share holdings in Opendoor and Sunnova, respectively. During the six months ended May 31, 2021, Opendoor began trading on the Nasdaq stock market and the Company began to mark to market the Company's share holdings in the public entity. The mark to market recognition was due to the investment now being accounted for as an investment in equity securities which is held at fair value and the change in fair value is recognized through earnings. As of November 30, 2020, the investment in Opendoor was included in the Company's investments in unconsolidated entities and was accounted for using the equity method. In addition, as previously noted, several of the Company's other strategic technology investments have announced plans to go public either through an initial public offering or by merging with a publicly traded special purpose acquisition company.

(3)Investments in Unconsolidated Entities

Homebuilding Unconsolidated Entities

~~As of May 31, 2020 and November 30, 2019,~~The investments in the ~~Company’s recorded investments in~~Company's Homebuilding unconsolidated entities were ~~$973.0 million and $1.0 billion, respectively, while the underlying equity in Homebuilding unconsolidated entities partners’ net assets~~ as ~~of both May 31, 2020 and November 30, 2019 was $1.3 billion.~~ follows:



(In thousands)	May 31, 2021		November 30, 2020
Investments in unconsolidated entities (1) (2)	$	1,010,256	953,177
Underlying equity in unconsolidated entities' net assets (1)	1,320,015		1,269,701

(1)The basis difference was primarily as a

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

result of the Company contributing its investment in3 three strategic joint ventures with a higher fair value than book value for an investment in the FivePoint entity and deferring equity in earnings on land sales to the Company.

(2)Included in the Company's recorded investments in Homebuilding unconsolidated entities is the Company's 40% ownership of FivePoint. As of May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, the carrying amount of the Company's ~~FivePoint~~ investment was ~~$376.9~~$387.0 million and ~~$374.0~~$392.1 million, respectively.

The ~~Homebuilding unconsolidated entities in which the~~ Company has ~~investments usually finance their activities with a combination~~an immaterial amount of ~~partner equity and debt financing. In some instances, the Company and its partners have guaranteed debt of certain unconsolidated entities.~~

Indebtedness of an unconsolidated entity is secured by its own assets. Some unconsolidated entities own multiple properties and other assets. There is no cross collateralization of debt of different unconsolidated entities. The Company also does not use its investment in one unconsolidated entity as collateral for the debt of another unconsolidated entity or commingle funds among Homebuilding unconsolidated entities.

~~In connection with loans~~recourse exposure to a Homebuilding unconsolidated entity, the Company and its partners often guarantee to a lender, either jointly and severally or on a several basis, any or all of the following: (i) the completion of the development, in whole or in part, for which the financing was obtained (ii) indemnification of the lender against losses from environmental issues, (iii) indemnification of the lender from "bad boy acts" of the unconsolidated entity (or full recourse liability in the event of an unauthorized transfer or bankruptcy) and (iv) that the loan to value and/or loan to cost will not exceed a certain percentage (maintenance or remargining guarantee) or that a percentage of the outstanding loan will be repaid (repayment guarantee).

~~The total~~ debt of the Homebuilding unconsolidated entities in which it has investments. While the Company has investments was $1.1 billion as of both May 31, 2020 and November 30, 2019, of which the Company's maximum recourse exposure was $4.9 million and $10.8 million as of May 31, 2020 and November 30, 2019, respectively. In most instances in which the Company has guaranteedsometimes guarantees debt of an unconsolidated ~~entity,~~entities, in most instances the Company’s partners have also guaranteed that debt and are required to contribute their ~~share~~shares of any payments. In most instances the amount of guaranteed debt of an unconsolidated entity is less than the value of the ~~guarantee payments.~~ collateral securing it.

In ~~a repayment guarantee,~~the first quarter of 2021, the Company ~~and its venture partners guarantee repayment of a portion or all of~~formed the ~~debt~~Upward America Venture ("the Venture"). The Venture will acquire single family homes for rent in high growth markets across the ~~event of default before the lender would have~~United States. The Venture raised equity to ~~exercise its rights against the collateral.~~

If the Company is required to make a payment under any guarantee, the payment would constitute a capital contribution or loan to the Homebuilding unconsolidated entity and increase the Company’s investment in the unconsolidated entity and its share of any funds the unconsolidated entity distributes.

As of both May 31, 2020 and November 30, 2019, the fair values of the repayment guarantees, maintenance guarantees, and completion guarantees were not material. The Company believes that as of May 31, 2020, in the event it becomes legally obligated to perform under a guarantee of the obligation of a Homebuilding unconsolidated entity dueget to a ~~triggering event under a guarantee,~~total commitment of $1.25 billion led by institutional investors. Including leverage, the ~~collateral would~~Venture will be ~~sufficient~~positioned to ~~repay at least a significant portion~~acquire over $4.0 billion of ~~the obligation or the Company~~new single family homes and ~~its partners would contribute additional capital into the venture. In certain instances, the Company has placed performance letters of credit~~townhomes from Lennar and ~~surety bonds with municipalities with regard to obligations of its joint ventures (see Note 7 of the Notes to the Condensed Consolidated Financial Statements).~~potentially other homebuilders.

Multifamily Unconsolidated Entities

The unconsolidated entities in which the Multifamily segment has investments usually finance their activities with a combination of partner equity and debt financing. In connection with many of the bank loans to Multifamily unconsolidated entities, 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 details related to these are unchanged from 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 increasedisclosure in the Company's ~~investment~~Notes to the Financial Statements section in its Form 10-K for the ~~entities and would increase its share of funds the entities distribute after the achievement of certain thresholds.~~year ended November 30, 2020. As of both May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, the fair value of the completion guarantees was immaterial. As of May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, Multifamily segment's unconsolidated entities had non-recourse debt with completion guarantees of ~~$813.8~~$748.4 million and ~~$867.3~~$722.9 million, respectively.

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

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. During the three and six months ended May 31, 2020, the Multifamily segment recorded fee income, net of deferrals, from its unconsolidated entities of $14.6 million and $28.4 million, respectively. During the three and six months ended May 31, 2019, the Multifamily segment recorded fee income, net of deferrals, from its unconsolidated entities of $13.3 million and $26.4 million, respectively.

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 ~~an investment. During~~investments. The details of the ~~three and six months ended May 31, 2020, the~~activity was as follows:

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

Multifamily segment provided general contractor services, net of deferrals, totaling $104.5 million and $198.4 million, respectively, which were partially offset by costs related to those services of $100.3 million and $190.5 million, respectively. During the three and six months ended May 31, 2019, the Multifamily segment provided general contractor services, net of deferrals, totaling $99.2 million and $181.6 million, respectively, which were partially offset by costs related to those services of $95.2 million and $174.6 million, respectively.


	Three Months Ended			Six Months Ended
	May 31,			May 31,
(In thousands)	2021		2020	2021	2020

General contractor services, net of deferrals	$	148,891	104,471	264,290	198,365
General contractor costs	142,783		100,284	253,236	190,465
Management fee income	14,188		14,574	29,059	28,397

The Multifamily segment includes Multifamily Venture Fund I ("LMV I") and Multifamily Venture Fund II LP ("LMV II"), which are long-term multifamily development investment vehicles involved in the development, construction and property management of class-A multifamily assets. Details of each as of and during the six months ended May 31, ~~2020~~2021 are included below:


		May 31, 2020						May 31, 2021
(In thousands)	(In thousands)	LMV I		LMV II	(In thousands)	LMV I		LMV II
Lennar's carrying value of investments	Lennar's carrying value of investments	$	355,136	213,635	Lennar's carrying value of investments	$	291,018	330,037
Equity commitments	Equity commitments	2,204,016		1,257,700	Equity commitments	2,204,016		1,257,700
Equity commitments called	Equity commitments called	2,127,560		754,177	Equity commitments called	2,142,446		1,168,546
Lennar's equity commitments	Lennar's equity commitments	504,016		381,000	Lennar's equity commitments	504,016		381,000
Lennar's equity commitments called	Lennar's equity commitments called	493,730		227,372	Lennar's equity commitments called	497,413		352,934
Lennar's remaining commitments	Lennar's remaining commitments	10,286		153,628	Lennar's remaining commitments	6,603		28,066
Distributions to Lennar during the six months ended May 31, 2020		19,969		—
Distributions to Lennar during the six months ended May 31, 2021					Distributions to Lennar during the six months ended May 31, 2021	40,581		1,165

Lennar Other Unconsolidated Entities

Lennar Other's unconsolidated entities includes fund investments the Company retained when it sold the Rialto assets and investment management platform, as well as strategic investments in technology companies, primarily managed by the Company's LENX subsidiary. These strategic investments include the Company's investment in Doma, formerly known as States Title, which was reclassified from the Financial Services segment.

(4)Stockholders' Equity

The following tables reflect the changes in equity attributable to both Lennar Corporation and the noncontrolling interests of its consolidated subsidiaries in which it has less than a 100% ownership interest for the three and six months ended May 31, ~~2020~~2021 and ~~2019:~~2020:

Three Months Ended May 31, 2020
(In thousands) Total
Equity Class A
Common Stock Class B
Common Stock Additional
Paid - in Capital Treasury
Stock Accumulated Other Comprehensive Income (Loss) Retained
Earnings Noncontrolling
Interests
Balance at February 29, 2020 $ 16,193,377 29,802 3,944 8,609,944 (1,253,756) 452 8,654,213 148,778
Net earnings (including net loss attributable to noncontrolling interests) 516,098 — — — — — 517,406 (1,308)
Employee stock and directors plans 651 2 — 756 (107) — — —
Purchases of treasury stock — — — — — — — —
Amortization of restricted stock 23,286 — — 23,286 — — — —
Cash dividends (38,905) — — — — — (38,905) —
Receipts related to noncontrolling interests 80,148 — — — — — — 80,148
Payments related to noncontrolling interests (4,767) — — — — — — (4,767)
Non-cash purchase or activity of noncontrolling interests, net

(5,168) — — (3,544) — — — (1,624)
Non-cash consolidations/deconsolidations, net (131,306) — — — — — — (131,306)
Total other comprehensive loss, net of tax (790) — — — — (790) — —
Balance at May 31, 2020 $ 16,632,624 29,804 3,944 8,630,442 (1,253,863) (338) 9,132,714 89,921


			Three Months Ended May 31, 2021
(In thousands)	Total Equity		Class A Common Stock	Class B Common Stock	Additional Paid - in Capital	Treasury Stock	Accumulated Other Comprehensive Income (loss)		Retained Earnings	Noncontrolling Interests
Balance at February 28, 2021	$	19,017,451	30,047	3,944	8,724,192	(1,348,710)	(1,747)		11,488,520	121,205
Net earnings (including net earnings attributable to noncontrolling interests)	836,772		—	—	—	—	—		831,363	5,409
Employee stock and directors plans	(4,537)		2	—	1,165	(5,704)	—		—	—
Purchases of treasury stock	(98,460)		—	—	—	(98,460)	—		—	—




Amortization of restricted stock	32,276		—	—	32,276	—	—		—	—
Cash dividends	(78,483)		—	—	—	—	—	—	(78,483)	—

Receipts related to noncontrolling interests	5,009		—	—	—	—	—		—	5,009
Payments related to noncontrolling interests	(5,829)		—	—	—	—	—		—	(5,829)
Non-cash purchase or activity of noncontrolling interests, net	(2,417)		—	—	(2,613)	—	—		—	196



Total other comprehensive income, net of tax	316		—	—	—	—	316		—	—
Balance at May 31, 2021	$	19,702,098	30,049	3,944	8,755,020	(1,452,874)	(1,431)		12,241,400	125,990

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)


				Three Months Ended May 31, 2019																Three Months Ended May 31, 2020
(In thousands)	(In thousands)	Total Equity		Class A Common Stock	Class B Common Stock	Additional Paid - in Capital	Treasury Stock	Accumulated Other Comprehensive Income (Loss)	Retained Earnings	Noncontrolling Interests	(In thousands)	Total Equity		Class A Common Stock	Class B Common Stock	Additional Paid - in Capital	Treasury Stock	Accumulated Other Comprehensive Income (loss)		Retained Earnings	Noncontrolling Interests
Balance at February 28, 2019		$	14,893,695	29,501	3,944	8,514,301	(485,016)	(158)	6,724,242	106,881
Balance at February 29, 2020											Balance at February 29, 2020	$	16,193,377	29,802	3,944	8,609,944	(1,253,756)	452		8,654,213	148,778
Net earnings (including net loss attributable to noncontrolling interests)	Net earnings (including net loss attributable to noncontrolling interests)	418,869		—	—	—	—	—	421,472	(2,603)	Net earnings (including net loss attributable to noncontrolling interests)	516,098		—	—	—	—	—		517,406	(1,308)
Employee stock and directors plans	Employee stock and directors plans	731		2	—	1,036	(307)	—	—	—	Employee stock and directors plans	651		2	—	756	(107)	—		—	—
Purchases of treasury stock		(51,783)		—	—	—	(51,783)	—	—	—

Amortization of restricted stock	Amortization of restricted stock	14,491		—	—	14,491	—	—	—	—	Amortization of restricted stock	23,286		—	—	23,286	—	—		—	—
Cash dividends	Cash dividends	(13,017)		—	—	—	—	—	(13,017)	—	Cash dividends	(38,905)		—	—	—	—	—	—	(38,905)	—

Receipts related to noncontrolling interests	Receipts related to noncontrolling interests	589		—	—	—	—	—	—	589	Receipts related to noncontrolling interests	80,148		—	—	—	—	—		—	80,148
Payments related to noncontrolling interests	Payments related to noncontrolling interests	(12,020)		—	—	—	—	—	—	(12,020)	Payments related to noncontrolling interests	(4,767)		—	—	—	—	—		—	(4,767)
Non-cash consolidations/deconsolidations, net											Non-cash consolidations/deconsolidations, net	(131,306)		—	—	—	—	—		—	(131,306)
Non-cash purchase or activity of noncontrolling interests, net											Non-cash purchase or activity of noncontrolling interests, net	(5,168)		—	—	(3,544)	—	—		—	(1,624)

Non-cash activities related to noncontrolling interests		(5,616)		—	—	—	—	—	—	(5,616)
Cumulative-effect of accounting change		211		—	—	—	—	—	211	—

Total other comprehensive earnings, net of tax		385		—	—	—	—	385	—	—
Balance at May 31, 2019		$	15,246,535	29,503	3,944	8,529,828	(537,106)	227	7,132,908	87,231
Total other comprehensive loss, net of tax											Total other comprehensive loss, net of tax	(790)		—	—	—	—	(790)		—	—
Balance at May 31, 2020											Balance at May 31, 2020	$	16,632,624	29,804	3,944	8,630,442	(1,253,863)	(338)		9,132,714	89,921


			Six Months Ended May 31, 2021
(In thousands)	Total Equity		Class A Common Stock	Class B Common Stock	Additional Paid - in Capital	Treasury Stock	Accumulated Other Comprehensive Loss	Retained Earnings	Noncontrolling Interests
Balance at November 30, 2020	$	18,099,401	29,894	3,944	8,676,056	(1,279,227)	(805)	10,564,994	104,545
Net earnings (including net earnings attributable to noncontrolling interests)	1,853,681		—	—	—	—	—	1,832,732	20,949
Employee stock and directors plans	(30,816)		155	—	1,106	(32,077)	—	—	—
Purchases of treasury stock	(141,570)		—	—	—	(141,570)	—	—	—



Amortization of restricted stock	81,094		—	—	81,094	—	—	—	—
Cash dividends	(156,326)		—	—	—	—	—	(156,326)	—
Receipts related to noncontrolling interests	13,905		—	—	—	—	—	—	13,905
Payments related to noncontrolling interests	(17,226)		—	—	—	—	—	—	(17,226)

Non-cash purchase or activity of noncontrolling interests, net	581		—	—	(3,236)	—	—	—	3,817



Total other comprehensive loss, net of tax	(626)		—	—	—	—	(626)	—	—
Balance at May 31, 2021	$	19,702,098	30,049	3,944	8,755,020	(1,452,874)	(1,431)	12,241,400	125,990


				Six Months Ended May 31, 2020																Six Months Ended May 31, 2020
(In thousands)	(In thousands)	Total Equity		Class A Common Stock	Class B Common Stock	Additional Paid - in Capital	Treasury Stock	Accumulated Other Comprehensive Income (Loss)	Retained Earnings	Noncontrolling Interests	(In thousands)	Total Equity		Class A Common Stock	Class B Common Stock	Additional Paid - in Capital	Treasury Stock	Accumulated Other Comprehensive Income (loss)		Retained Earnings	Noncontrolling Interests
Balance at November 30, 2019	Balance at November 30, 2019	$	16,033,830	29,712	3,944	8,578,219	(957,857)	498	8,295,001	84,313	Balance at November 30, 2019	$	16,033,830	29,712	3,944	8,578,219	(957,857)	498		8,295,001	84,313
Net earnings (including net loss attributable to noncontrolling interests)	Net earnings (including net loss attributable to noncontrolling interests)	907,321		—	—	—	—	—	915,858	(8,537)	Net earnings (including net loss attributable to noncontrolling interests)	907,321		—	—	—	—	—		915,858	(8,537)
Employee stock and directors plans	Employee stock and directors plans	(6,773)		92	—	626	(7,491)	—	—	—	Employee stock and directors plans	(6,773)		92	—	626	(7,491)	—		—	—
Purchases of treasury stock	Purchases of treasury stock	(288,515)		—	—	—	(288,515)	—	—	—	Purchases of treasury stock	(288,515)		—	—	—	(288,515)	—		—	—

Amortization of restricted stock	Amortization of restricted stock	55,141		—	—	55,141	—	—	—	—	Amortization of restricted stock	55,141		—	—	55,141	—	—		—	—
Cash dividends	Cash dividends	(78,145)		—	—	—	—	—	(78,145)	—	Cash dividends	(78,145)		—	—	—	—	—	—	(78,145)	—

Receipts related to noncontrolling interests	Receipts related to noncontrolling interests	169,061		—	—	—	—	—	—	169,061	Receipts related to noncontrolling interests	169,061		—	—	—	—	—		—	169,061
Payments related to noncontrolling interests	Payments related to noncontrolling interests	(21,501)		—	—	—	—	—	—	(21,501)	Payments related to noncontrolling interests	(21,501)		—	—	—	—	—		—	(21,501)

Non-cash consolidations/deconsolidations, net											Non-cash consolidations/deconsolidations, net	(131,791)		—	—	—	—	—		—	(131,791)
Non-cash purchase or activity of noncontrolling interests, net	Non-cash purchase or activity of noncontrolling interests, net	(5,168)		—	—	(3,544)	—	—	—	(1,624)	Non-cash purchase or activity of noncontrolling interests, net	(5,168)		—	—	(3,544)	—	—		—	(1,624)
Non-cash consolidations/deconsolidations, net		(131,791)		—	—	—	—	—	—	(131,791)

Total other comprehensive earnings, net of tax		(836)		—	—	—	—	(836)	—	—
Total other comprehensive loss, net of tax											Total other comprehensive loss, net of tax	(836)		—	—	—	—	(836)		—	—
Balance at May 31, 2020	Balance at May 31, 2020	$	16,632,624	29,804	3,944	8,630,442	(1,253,863)	(338)	9,132,714	89,921	Balance at May 31, 2020	$	16,632,624	29,804	3,944	8,630,442	(1,253,863)	(338)		9,132,714	89,921

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

Six Months Ended May 31, 2019
(In thousands) Total Equity Class A Common Stock Class B Common Stock Additional Paid - in Capital Treasury Stock Accumulated Other Comprehensive Income (Loss) Retained Earnings Noncontrolling Interests
Balance at November 30, 2018 $ 14,682,957 29,499 3,944 8,496,677 (435,869) (366) 6,487,650 101,422
Net earnings (including net loss attributable to noncontrolling interests) 658,293 — — — — — 661,382 (3,089)
Employee stock and directors plans (691) 4 — 1,761 (2,456) — — —
Purchases of treasury stock (98,781) — — — (98,781) — — —
Amortization of restricted stock 31,390 — — 31,390 — — — —
Cash dividends (25,877) — — — — — (25,877) —
Receipts related to noncontrolling interests 8,937 — — — — — — 8,937
Payments related to noncontrolling interests (23,317) — — — — — — (23,317)
Non-cash consolidations, net 8,894 — — — — — — 8,894
Non-cash activities related to noncontrolling interests (5,616) — — — — — — (5,616)
Cumulative-effect of accounting change 9,753 — — — — — 9,753 —
Total other comprehensive earnings, net of tax 593 — — — — 593 — —
Balance at May 31, 2019 $ 15,246,535 29,503 3,944 8,529,828 (537,106) 227 7,132,908 87,231

On June ~~25, 2020,~~18, 2021, the Company's Board of Directors declared a quarterly cash dividend of ~~$0.125~~$0.25 per share on both its Class A and Class B common stock, payable on July ~~24, 2020~~19, 2021 to holders of record at the close of business on July ~~10, 2020.~~2, 2021. On May 5, ~~2020,~~2021, the Company paid cash dividends of ~~$0.125~~$0.25 per share on both its Class A and Class B common stock to holders of record at the close of business on April 21, ~~2020,~~2021, as declared by its Board of Directors on April 7, ~~2020.~~2021. The Company approved and paid cash dividends of ~~$0.04~~$0.125 per share for each of the first three quarters of 2020 and $0.25 per share in the fourth quarter of 2020 and first two quarter of 2021 on both its Class A and Class B common ~~stock in each quarter for the year ended November 30, 2019.~~stock.

In January ~~2019,~~2021, the Company's Board of Directors authorized the repurchase of up to the lesser of $1 billion in value, excluding commissions, or 25 million in shares, of the Company's outstanding Class A and Class B common stock. The repurchase has no expiration date. The following table ~~describes~~represents the repurchase of the Company's Class A and Class B common stocks under this program and its predecessor for the three and six months ended May 31, ~~2020~~2021 and ~~2019:~~2020:

Three Months Ended Six Months Ended
May 31, 2020 May 31, 2019 May 31, 2020 May 31, 2019
(Dollars in thousands, except price per share) Class A Class B Class A Class B Class A Class B Class A Class B
Shares repurchased — — 1,000,000 — 4,250,000 115,000 2,000,000 —
Purchase amount $ — $ — $ 51,783 $ — $ 282,274 $ 6,155 $ 98,781 $ —
Average price per share $ — $ — $ 51.76 $ — $ 66.42 $ 53.52 $ 49.37 $ —


	Three Months Ended								Six Months Ended
	May 31, 2021				May 31, 2020				May 31, 2021				May 31, 2020
(Dollars in thousands, except price per share)	Class A		Class B		Class A		Class B		Class A		Class B		Class A		Class B
Shares repurchased	1,000,000		0		0		0		1,510,000		0		4,250,000		115,000
Principal	$	98,440	$	0	$	0	$	0	$	141,540	$	0	$	282,274	$	6,155
Average price per share	$	98.44	$	0	$	0	$	0	$	93.73	$	0	$	66.42	$	53.52

(5)Income Taxes

The provision for income taxes and effective tax rate were as follows:

Three Months Ended Six Months Ended
May 31, May 31,
(Dollars in thousands) 2020 2019 2020 2019
Provision for income taxes $160,479 140,530 192,808 220,230
Effective tax rate (1) 23.7 % 25.0 % 17.4 % 25.0 %


	Three Months Ended				Six Months Ended
	May 31,				May 31,
(Dollars in thousands)	2021		2020		2021		2020
Provision for income taxes	$260,113		160,479		570,218		192,808
Effective tax rate (1)	23.8	%	23.7	%	23.7	%	17.4	%

(1)For ~~both~~ the three and six months ended May 31, 2021 and 2020, the effective tax rate included state income tax expense and non-deductible executive compensation, partially offset by new energy efficient home and solar tax credits. ~~For the~~The six months ended May 31, 2020 ~~the effective tax rate~~ also included ~~a benefit~~benefits related to the years ended November 30, 2018 and 2019, due to Congress retroactively extending the new energy efficient home tax credit in December 2019.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

(6)Earnings Per Share

Basic earnings per share is computed by dividing net earnings attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company.

All outstanding nonvested shares that contain non-forfeitable rights to dividends or dividend equivalents that participate in undistributed earnings with common stock are considered participating securities and are included in computing earnings per share pursuant to the two-class method. The two-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings. The Company’s restricted common stock ("nonvested shares") is considered participating securities.

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

Basic and diluted earnings per share were calculated as follows:

Three Months Ended Six Months Ended
May 31, May 31,
(In thousands, except per share amounts) 2020 2019 2020 2019
Numerator:
Net earnings attributable to Lennar $ 517,406 421,472 915,858 661,382
Less: distributed earnings allocated to nonvested shares 357 94 690 193
Less: undistributed earnings allocated to nonvested shares 5,931 3,063 9,962 4,987
Numerator for basic earnings per share 511,118 418,315 905,206 656,202
Less: net amount attributable to noncontrolling interests in Rialto's Carried Interest Incentive Plan (1) 3,322 3,331 3,322 3,654
Numerator for diluted earnings per share $ 507,796 414,984 901,884 652,548
Denominator:
Denominator for basic earnings per share - weighted average common shares outstanding 308,373 320,329 309,793 320,834
Effect of dilutive securities:
Shared based payments — 1 1 6
Denominator for diluted earnings per share - weighted average common shares outstanding 308,373 320,330 309,794 320,840
Basic earnings per share $ 1.66 1.31 2.92 2.05
Diluted earnings per share $ 1.65 1.30 2.91 2.03


	Three Months Ended			Six Months Ended
	May 31,			May 31,
(In thousands, except per share amounts)	2021		2020	2021	2020
Numerator:
Net earnings attributable to Lennar	$	831,363	517,406	1,832,732	915,858
Less: distributed earnings allocated to nonvested shares	776		357	1,406	690
Less: undistributed earnings allocated to nonvested shares	10,308		5,931	22,026	9,962
Numerator for basic earnings per share	820,279		511,118	1,809,300	905,206
Less: net amount attributable to Rialto's Carried Interest Incentive Plan (1)	1,569		3,322	2,122	3,322



Numerator for diluted earnings per share	$	818,710	507,796	1,807,178	901,884
Denominator:
Denominator for basic earnings per share - weighted average common shares outstanding	308,893		308,373	308,957	309,793
Effect of dilutive securities:
Shared based payments	0		0	0	1

Denominator for diluted earnings per share - weighted average common shares outstanding	308,893		308,373	308,957	309,794
Basic earnings per share	$	2.66	1.66	5.86	2.92
Diluted earnings per share	$	2.65	1.65	5.85	2.91

(1)The amounts presented relate to Rialto's Carried Interest Incentive Plan and represent the difference between the advanced tax distributions received from the Rialto funds included in the Lennar Other segment and the amount Lennar is assumed to own.

For both the three and six months ended May 31, ~~2020~~2021 and May 31, ~~2019,~~2020, there were 0 options to purchase shares of common stock that were outstanding and anti-dilutive.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

(7)Homebuilding Senior Notes and Other Debts Payable


(Dollars in thousands)	(Dollars in thousands)	May 31, 2020		November 30, 2019	(Dollars in thousands)	May 31, 2021		November 30, 2020

2.95% senior notes due 2020		$	299,712	299,421
8.375% senior notes due 2021		410,591		418,860
4.750% senior notes due 2021		499,283		498,893
6.25% senior notes due December 2021		307,737		310,252
6.25% senior notes due December 2021 (1)					6.25% senior notes due December 2021 (1)	$	302,705	305,221
4.125% senior notes due 2022	4.125% senior notes due 2022	598,380		597,885	4.125% senior notes due 2022	599,371		598,876
5.375% senior notes due 2022	5.375% senior notes due 2022	256,770		258,198	5.375% senior notes due 2022	253,914		255,342
4.750% senior notes due 2022	4.750% senior notes due 2022	572,184		571,644	4.750% senior notes due 2022	573,300		572,724
4.875% senior notes due December 2023	4.875% senior notes due December 2023	396,950		396,553	4.875% senior notes due December 2023	397,948		397,347
4.500% senior notes due 2024	4.500% senior notes due 2024	647,165		646,802	4.500% senior notes due 2024	647,890		647,528
5.875% senior notes due 2024	5.875% senior notes due 2024	445,821		448,158	5.875% senior notes due 2024	441,147		443,484
4.750% senior notes due 2025	4.750% senior notes due 2025	497,780		497,558	4.750% senior notes due 2025	498,224		498,002
5.25% senior notes due 2026	5.25% senior notes due 2026	407,315		407,921	5.25% senior notes due 2026	406,103		406,709
5.00% senior notes due 2027	5.00% senior notes due 2027	352,700		352,892	5.00% senior notes due 2027	352,316		352,508
4.75% senior notes due 2027	4.75% senior notes due 2027	894,386		893,046	4.75% senior notes due 2027	895,135		894,760
6.625% senior notes due 2020		—		303,668
Mortgage notes on land and other debt	Mortgage notes on land and other debt	908,900		874,887	Mortgage notes on land and other debt	526,289		583,257
		$	7,495,674	7,776,638		$	5,894,342	5,955,758

(1)Subsequent to May 31, 2021, the Company retired these notes. The redemption price, which was paid in cash, was par plus accrued but unpaid interest.

The carrying amounts of the senior notes in the table above are net of debt issuance costs of ~~$19.6~~$13.6 million and ~~$22.9~~$15.9 million as of May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, respectively.

AtAs of May 31, ~~2020,~~2021 the ~~Company had an~~maximum available borrowings on the Company's unsecured revolving credit facility (the "Credit Facility") ~~with~~were $2.5 billion and included a $300 million accordion feature, subject to additional commitments, thus the maximum borrowings ~~of $2.45~~could be $2.8 billionmaturing in 2024. The Credit Facility agreement (the "Credit Agreement") provides that up to $500 million in commitments may be used for letters of ~~credit.~~credit. The maturity, debt covenants and details of the Credit Facility are unchanged from the disclosure in the Company's Financial Condition and Capital Resources section in its Form 10-K for the year ended November 30, 2019. Under the Credit Agreement, the Company is required to maintain a minimum consolidated tangible net worth, a maximum leverage ratio and either a liquidity or an interest coverage ratio. These ratios are calculated per the Credit Facility agreement, which involves adjustments to GAAP financial measures. The Company believes it was in compliance with its debt covenants at May 31, 2020. In addition to the Credit Facility, the Company has other letter of credit facilities with different financial institutions.

Performance letters of credit are generally posted with regulatory bodies to guarantee the Company’s performance of certain development and construction activities. Financial letters of credit are generally posted in lieu of cash deposits on option contracts, for insurance risks, credit enhancements and as other collateral. Additionally, at May 31, 2020, the Company had outstanding surety bonds including performance surety bonds related to site improvements at various projects (including certain projects in the Company’s joint ventures) and financial surety bonds. Although significant development and construction activities have been completed related to these site improvements, these bonds are generally not released until all development and construction activities are completed. The Company does not presently anticipate any draws upon these bonds or letters of credit, but if any such draws occur, the Company does not believe they would have a material effect on its financial position, results of operations or cash flows.

In May 2020, the Company redeemed $300 million aggregate principal amount of its 6.625% senior notes due May 2020. The redemption price, which was paid in cash, was 100% of the principal amount plus accrued but unpaid interest.

~~The company's letter of credit and surety bond facilities are described below:~~

May 31,
2020 November 30,
2019
(In thousands)
Performance letters of credit $ 726,191 715,793
Financial letters of credit 220,264 184,075
Surety bonds 2,995,941 2,946,167
Anticipated future costs related to site improvements subject to performance surety bonds 1,496,571 1,427,145

1918

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

Procedures related to performance letters of credit, financial letters of credit and surety bonds are unchanged from the disclosure in the Company's Financial Condition and Capital Resources section in its Form 10-K for the year ended November 30, 2020. The Company's outstanding performance letters of credit and surety bonds are described below:


(In thousands)	May 31, 2021		November 30, 2020


Performance letters of credit	$	817,831	752,096
Surety bonds	3,306,473		3,087,711
Anticipated future costs primarily for site improvements related to performance surety bonds	1,743,993		1,584,642

The Company's senior notes are guaranteed by substantially all of the Company's 100% owned homebuilding subsidiaries and some of the Company's other subsidiaries. ~~Although the~~These guarantees are ~~full, unconditional~~unchanged from the disclosure in the Company's Financial Condition and ~~joint and several while they are~~Capital Resources section in effect, (i) a subsidiary will cease to be a guarantor at any time when it is not directly or indirectly guaranteeing at least $75 million of debt of Lennar Corporation (the parent company), and (ii) a subsidiary will be released from its ~~guarantee and any other obligations it may have regarding~~Form 10-K for the ~~senior notes if all or substantially all its assets, or all of its capital stock, are sold or otherwise disposed of.~~year ended November 30, 2020.

(8)Product Warranty

Warranty and similar reserves for homes are established at an amount estimated to be adequate to cover potential costs for materials and labor with regard to warranty-type claims expected to be incurred subsequent to the delivery of a home. Reserves are determined based on historical data and trends with respect to similar product types and geographical areas. The activity in the Company’s warranty reserve, which are included in Homebuilding other liabilities, was as follows:

Three Months Ended Six Months Ended
May 31, May 31,
(In thousands) 2020 2019 2020 2019
Warranty reserve, beginning of the period $ 287,413 295,622 294,138 319,109
Warranties issued 46,272 47,855 84,543 81,826
Adjustments to pre-existing warranties from changes in estimates (1) 7,707 2,004 13,611 (7,523)
Payments (39,930) (53,857) (90,830) (101,788)
Warranty reserve, end of period $ 301,462 291,624 301,462 291,624


	Three Months Ended			Six Months Ended
	May 31,			May 31,
(In thousands)	2021		2020	2021	2020
Warranty reserve, beginning of the period	$	348,100	287,413	341,765	294,138
Warranties issued	51,690		46,272	94,618	84,543
Adjustments to pre-existing warranties from changes in estimates (1)	13,119		7,707	18,760	13,611

Payments	(51,168)		(39,930)	(93,402)	(90,830)
Warranty reserve, end of period	$	361,741	301,462	361,741	301,462

(1)The adjustments to pre-existing warranties from changes in estimates during the three and six months ended May 31, ~~2020~~2021 and ~~2019 are~~May 31, 2020 primarily related to specific claims in certain of the Company's homebuilding communities and other adjustments.

(9)Financial Instruments and Fair Value Disclosures

The following table presents the carrying amounts and estimated fair values of financial instruments held or issued by the Company at May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, using available market information and what the Company believes to be appropriate valuation methodologies. Considerable judgment is required in interpreting market data to develop the estimates of fair value. The use of different market assumptions and/or estimation methodologies might have a material effect on the estimated fair value amounts. The table excludes cash and cash equivalents, restricted cash, receivables, net and accounts payable, all of which had fair values approximating their carrying amounts due to the short maturities and liquidity of these instruments.

May 31, 2020 November 30, 2019
(In thousands) Fair Value Hierarchy Carrying Amount Fair Value Carrying Amount Fair Value
ASSETS
Financial Services:
Loans held-for-investment, net Level 3 $ 69,846 66,529 73,867 69,708
Investments held-to-maturity Level 3 $ 164,982 188,942 166,012 195,962
Investments held-to-maturity Level 2 $ — — 24,277 24,257
Lennar Other:
Investments held-to-maturity Level 3 $ — — 54,117 56,415
LIABILITIES
Homebuilding senior notes and other debts payable, net Level 2 $ 7,495,674 7,828,214 7,776,638 8,144,632
Financial Services notes and other debts payable, net Level 2 $ 1,435,538 1,436,961 1,745,755 1,745,782
Multifamily note payable, net Level 2 $ — — 36,125 36,125
Lennar Other notes and other debts payable, net Level 2 $ 6,170 6,170 15,178 15,178


		May 31, 2021			November 30, 2020
(In thousands)	Fair Value Hierarchy	Carrying Amount		Fair Value	Carrying Amount	Fair Value
ASSETS
Financial Services:
Loans held-for-investment, net	Level 3	$	77,680	77,780	72,626	70,808
Investments held-to-maturity	Level 3	162,919		193,781	164,230	196,047



LIABILITIES
Homebuilding senior notes and other debts payable, net	Level 2	$	5,894,342	6,414,267	5,955,758	6,581,798
Financial Services notes and other debts payable, net	Level 2	928,185		929,051	1,463,919	1,464,850

Lennar Other notes and other debts payable, net	Level 2	1,906		1,906	1,906	1,906

The following methods and assumptions are used by the Company in estimating fair values:

Financial Services—The fair values above are based on quoted market prices, if available. The fair values for instruments that do not have quoted market prices are estimated by the Company on the basis of discounted cash flows or other financial information. For notes and other debts payable, the fair values approximate their carrying value due to variable interest pricing terms and the short-term nature of the majority of the borrowings.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

Homebuilding—For senior notes and other debts payable, the fair value of fixed-rate borrowings is primarily based on quoted market prices and the fair value of variable-rate borrowings is based on expected future cash flows calculated using current market forward rates.

~~Multifamily—For notes payable, the fair values approximate their carrying value due~~

Lennar Corporation and Subsidiaries

Notes to ~~variable interest pricing terms and the short-term nature of the borrowings.~~Condensed Consolidated Financial Statements (unaudited) (Continued)

Lennar Other—The fair value for ~~investments held-to-maturity is based on discounted cash flow. For~~ notes payable ~~the fair values~~ approximate their carrying value due to variable interest pricing terms and the short-term nature of the borrowings.

Fair Value Measurements:

GAAP provides a framework for measuring fair value, expands disclosures about fair value measurements and establishes a fair value hierarchy which prioritizes the inputs used in measuring fair value summarized as follows:

Level 1: Fair value determined based on quoted prices in active markets for identical assets.

Level 2: Fair value determined using significant other observable inputs.

Level 3: Fair value determined using significant unobservable inputs.

The Company’s financial instruments measured at fair value on a recurring basis are summarized below:


	Fair Value Hierarchy	Fair Value at
(In thousands)		May 31, 2021		November 30, 2020
Financial Services Assets:
Residential loans held-for-sale	Level 2	$	851,518	1,296,517
LMF Commercial loans held-for-sale	Level 3	163,920		193,588



Mortgage servicing rights	Level 3	2,602		2,113
Lennar Other:
Investments in equity securities	Level 1	$	461,238	0
Investments available-for-sale	Level 3	41,563		53,497

(In thousands) Fair Value Hierarchy Fair Value at May 31,
2020 Fair Value at November 30,
2019
Financial Services Assets:
Residential loans held-for-sale (1) Level 2 $ 1,003,470 1,447,715
LMF Commercial loans held-for-sale (2) Level 3 $ 159,886 197,224
Mortgage servicing rights Level 3 $ 1,238 24,679
Lennar Other:
Investments available-for-sale Level 3 $ 53,585 —

~~(1)~~The aggregate fair value of residential loans held-for-sale of $1.0 billion at May 31, 2020 exceeded their aggregate principal balance of $963.5 million by $40.0 million. The aggregate fair value of residential loans held-for-sale of $1.4 billion at November 30, 2019 exceeded their aggregate principal balance of $1.4 billion by $42.2 million.

~~(2)The aggregate fair value of~~Residential and LMF Commercial loans held-for-sale of $159.9 million at May 31, 2020 exceeded their aggregate principal balance of $156.2 million by $3.7 million. The aggregate fair value of LMF Commercial loans held-for-sale of $197.2 million at November 30, 2019 exceeded their aggregate principal balance of $196.3 million by $0.9 million.in the table above include:


	May 31, 2021		November 30, 2020

(In thousands)	Aggregate Principal Balance		Change in Fair Value	Aggregate Principal Balance	Change in Fair Value





Residential loans held-for-sale	$	817,901	33,617	1,232,548	63,969
LMF Commercial loans held-for-sale	167,948		(4,028)	194,362	(774)

Financial Services residential loans held-for-sale - Fair value is based on independent quoted market prices, where available, or the prices for other mortgage whole loans with similar characteristics. Management believes carrying loans held-for-sale at fair value improves financial reporting by mitigating volatility in reported earnings caused by measuring the fair value of the loans and the derivative instruments used to economically hedge them without having to apply complex hedge accounting provisions. In addition, theThe Company recognizes the fair value of its rights to service a mortgage loan as revenue upon entering into an interest rate lock loan commitment with a borrower. The fair value of these ~~servicing rights is~~are included in Financial Services’ loans held-for-sale as of May 31, ~~2020~~2021 and November 30, ~~2019.~~2020. Fair value of servicing rights is determined based on actual sales of servicing rights on loans with similar characteristics.

LMF Commercial loans held-for-sale - The fair value of loans held-for-sale is calculated from model-based techniques that use discounted cash flow assumptions and the Company’s own estimates of CMBS spreads, market interest rate movements and the underlying loan credit quality. ~~Loan values~~The details and methods of the calculation are ~~calculated by allocating~~unchanged from the ~~change in~~fair value of an assumed CMBS capital structure to each loan. The value of an assumed CMBS capital structure is calculated, generally, by discounting the cash flows associated with each CMBS class at market interest rates and at the Company’s own estimate of CMBS spreads. The Company estimates CMBS spreads by observing the pricing of recent CMBS offerings, secondary CMBS markets, changesdisclosure in the ~~CMBX index, and general capital and commercial real estate market conditions. Considerations~~Company's Notes to the Financial Statements section in ~~estimating CMBS spreads include comparing~~its Form 10-K for the ~~Company’s current loan portfolio with comparable CMBS offerings containing loans with similar duration, credit quality and collateral composition.~~year ended November 30, 2020. These methods use unobservable inputs in estimating a discount rate that is used to assign a value to each loan. While the cash payments on the loans are contractual, the discount rate used and assumptions regarding the relative size of each class in the CMBS capital structure can significantly impact the valuation. Therefore, the estimates used could differ materially from the fair value determined when the loans are sold to a securitization trust.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

Mortgage servicing rights - Financial Services records mortgage servicing rights when it sells loans on a servicing-retained basis or through the acquisition or assumption of the right to service a financial asset. The fair value of the mortgage servicing rights is calculated using third-party valuations. The key assumptions, which are generally unobservable inputs, used in the valuation of the mortgage servicing rights include mortgage prepayment rates, discount rates and delinquency rates and are noted below:



	~~As of May 31, 2020~~
~~Unobservable inputs~~
~~Mortgage prepayment rate~~	20	%
~~Discount rate~~	11	%
~~Delinquency rate~~	4	%



Unobservable inputs	As of May 31, 2021	As of November 30, 2020

Mortgage prepayment rate	13%	18%
Discount rate	14%	12%
Delinquency rate	3%	4%

Lennar Other investments in equity securities - The fair value of investments in equity securities was calculated based on independent quoted market prices. The Company’s investments in equity securities were recorded at fair value with all changes in fair value recorded to Lennar Other unrealized gain of the Company’s condensed consolidated statements of operations and comprehensive income (loss).

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

Lennar Other investments available-for-sale - The fair value of investments available-for-sale is calculated from model-based techniques that use discounted cash flow assumptions and the Company’s own estimates of CMBS spreads, market interest rate movements and the underlying loan credit quality. Loan values are calculated by allocating the change in value of an assumed CMBS capital structure to each loan. The value of an assumed CMBS capital structure is calculated, generally, by discounting the cash flows associated with each CMBS class at market interest rates and at the Company’s own estimate of CMBS spreads.

The changes in fair values for Level 1 and Level 2 financial instruments measured on a recurring basis are shown below by financial instrument and financial statement line item:


		Three Months Ended				Six Months Ended					Three Months Ended		Six Months Ended
		May 31,				May 31,					May 31,		May 31,
(In thousands)	(In thousands)	2020		2019	2020	2019	(In thousands)	2021		2020	2021	2020
Changes in fair value included in Financial Services revenues:	Changes in fair value included in Financial Services revenues:						Changes in fair value included in Financial Services revenues:
Loans held-for-sale	Loans held-for-sale	$	5,270	13,007	(2,223)	2,887	Loans held-for-sale	$	4,669	5,270	(30,352)	(2,223)
Mortgage loan commitments	Mortgage loan commitments	13,816		9,111	28,711	8,852	Mortgage loan commitments	5,057		13,816	142	28,711
Forward contracts	Forward contracts	8,478		(9,766)	(883)	(913)	Forward contracts	(23,953)		8,478	10,285	(883)

Changes in fair value included in other comprehensive income (loss), net of tax:
Changes in fair value included in Lennar Other realized and unrealized gain (loss):							Changes in fair value included in Lennar Other realized and unrealized gain (loss):
Investments in equity securities							Investments in equity securities	$	(272,625)	0	197,120	0
Changes in fair value included in other comprehensive loss, net of tax:							Changes in fair value included in other comprehensive loss, net of tax:
Lennar Other investments available-for-sale	Lennar Other investments available-for-sale	(338)		—	(338)	—	Lennar Other investments available-for-sale	$	316	(338)	(626)	(384)
Financial Services investments available-for-sale		—		561	(46)	769

Interest on Financial Services loans held-for-sale and LMF Commercial loans held-for-sale measured at fair value is calculated based on the interest rate of the loans and recorded as revenues in the Financial Services’ statement of operations.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

The following table represents the reconciliation of the beginning and ending balance for the Level 3 recurring fair value measurements in the Company's Financial Services segment:


		Three Months Ended										Three Months Ended
		May 31, 2020				May 31, 2019					May 31, 2021		May 31, 2020
(In thousands)	(In thousands)	Mortgage servicing rights		LMF Commercial loans held-for-sale	Mortgage servicing rights	LMF Commercial loans held-for-sale	(In thousands)	Mortgage servicing rights		LMF Commercial loans held-for-sale	Mortgage servicing rights	LMF Commercial loans held-for-sale
Beginning balance	Beginning balance	$	12,576	300,402	35,448	131,042	Beginning balance	$	1,499	123,148	12,576	300,402
Purchases/loan originations	Purchases/loan originations	607		5,400	672	435,189	Purchases/loan originations	20		201,296	607	5,400
Sales/loan originations sold, including those not settled	Sales/loan originations sold, including those not settled	—		(143,285)	—	(299,962)	Sales/loan originations sold, including those not settled	0		(155,740)	0	(143,285)
Disposals/settlements (1)	Disposals/settlements (1)	(8,908)		—	(1,378)	(9,920)	Disposals/settlements (1)	(58)		(7,300)	(8,908)	0
Changes in fair value (2)	Changes in fair value (2)	(3,037)		(2,334)	(5,323)	3,022	Changes in fair value (2)	1,141		2,825	(3,037)	(2,334)
Interest and principal paydowns	Interest and principal paydowns	—		(298)	—	228	Interest and principal paydowns	0		(309)	0	(298)
Ending balance	Ending balance	$	1,238	159,885	29,419	259,599	Ending balance	$	2,602	163,920	1,238	159,885

		Six Months Ended
		May 31, 2020				May 31, 2019
(In thousands)		Mortgage servicing rights		LMF Commercial loans held-for-sale	Mortgage servicing rights	LMF Commercial loans held-for-sale
Beginning balance		$	24,679	197,224	37,206	61,691
Purchases/loan originations		1,354		417,650	2,259	705,311
Sales/loan originations sold, including those not settled		—		(457,724)	—	(500,549)
Disposals/settlements (1)		(10,197)		—	(2,287)	(9,920)
Changes in fair value (2)		(14,598)		3,267	(7,759)	3,324
Interest and principal paydowns		—		(532)	—	(258)
Ending balance		$	1,238	159,885	29,419	259,599


	Six Months Ended
	May 31, 2021			May 31, 2020
(In thousands)	Mortgage servicing rights		LMF Commercial loans held-for-sale	Mortgage servicing rights	LMF Commercial loans held-for-sale
Beginning balance	$	2,113	193,588	24,679	197,224
Purchases/loan originations	443		420,796	1,354	417,650
Sales/loan originations sold, including those not settled	0		(438,705)	0	(457,724)
Disposals/settlements (1)	(1,095)		(7,300)	(10,197)	0
Changes in fair value (2)	1,141		(3,942)	(14,598)	3,267
Interest and principal paydowns	0		(517)	0	(532)
Ending balance	$	2,602	163,920	1,238	159,885

(1)~~Includes~~The three and six months ended May 31, 2020 include $7.5 million related to the sale of a servicing portfolio.

(2)Changes in fair value for LMF Commercial loans held-for-sale and Financial Services mortgage servicing rights are included in Financial Services' revenues.

The Company’s assets measured at fair value on a nonrecurring basis are those assets for which the Company has recorded valuation adjustments and write-offs. The fair values included in the table below represent only those assets whose carrying values were adjusted to fair value during the respective periods disclosed. The assets measured at fair value on a nonrecurring basis are summarized below:

Three Months Ended
May 31, 2020 May 31, 2019
(In thousands) Fair Value
Hierarchy Carrying Value Fair Value Total Losses, Net (1) Carrying Value Fair Value Total Losses, Net
Non-financial assets
Homebuilding:
Finished homes and construction in progress (1) Level 3 $ 68,802 61,119 (7,683) — — —
Land and land under development (1) Level 3 $ 42,609 9,709 (32,900) — — —
Six Months Ended
May 31, 2020 May 31, 2019
(In thousands) Fair Value
Hierarchy Carrying Value Fair Value Total Losses, Net (1) Carrying Value Fair Value Total Losses, Net (1)
Non-financial assets
Homebuilding:
Finished homes and construction in progress (1) Level 3 $ 141,809 120,404 (21,405) — — —
Land and land under development (1) Level 3 $ 65,062 21,369 (43,693) 6,954 3,001 (3,953)

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)


		Three Months Ended
		May 31, 2021				May 31, 2020
(In thousands)	Fair Value Hierarchy	Carrying Value		Fair Value	Total Losses, Net (1)	Carrying Value	Fair Value	Total Losses, Net (1)




Non-financial assets - Homebuilding:

Finished homes and construction in progress (1)	Level 3	$	19,240	6,378	(12,862)	68,802	61,119	(7,683)
Land and land under development (1)	Level 3	78		0	(78)	42,609	9,709	(32,900)


		Six Months Ended
		May 31, 2021				May 31, 2020
(In thousands)	Fair Value Hierarchy	Carrying Value		Fair Value	Total Losses, Net (1)	Carrying Value	Fair Value	Total Losses, Net (1)




Non-financial assets - Homebuilding:

Finished homes and construction in progress (1)	Level 3	$	21,784	8,728	(13,056)	141,809	120,404	(21,405)
Land and land under development (1)	Level 3	520		0	(520)	65,062	21,369	(43,693)

(1)Valuation adjustments were included in Homebuilding costs and expenses in the Company's condensed consolidated statements of operations and comprehensive income (loss).

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

Finished homes and construction in progress are included within inventories. Inventories are stated at cost unless the inventory within a community is determined to be impaired, in which case the impaired inventory is written down to fair value. The Company disclosed its accounting policy related to inventories and its review for indicators of impairment in the Summary of Significant Accounting Policies in its Form 10-K for the year ended November 30, ~~2019.~~2020.

The Company estimates the fair value of inventory evaluated for impairment based on market conditions and assumptions made by management at the time the inventory is evaluated, which may differ materially from actual results if market conditions or assumptions change. This was particularly the case with regard to inventory owned at May 31, 2020, because of the need to consider the effect of the COVID-19 pandemic and related government actions in determining whether there was a need for valuation adjustments and write-offs. For example, changes in market conditions and other specific developments or changes in assumptions may cause the Company to re-evaluate its strategy regarding previously impaired inventory, as well as inventory not currently impaired but for which indicators of impairment may arise if market deterioration occurs, and certain other assets that could result in further valuation adjustments and/or additional write-offs of option deposits and pre-acquisition costs due to abandonment of those options contracts.

The Company disclosed its accounting policy related to inventories and its review for indicators of impairment in the Summary of Significant Accounting Policies in its Form 10-K for the year ended November 30, ~~2019.~~2020. On a quarterly basis, the Company reviews its active communities for indicators of potential impairments. ~~As of May 31, 2020 and May 31, 2019, there were 1,241 and 1,320 active communities, excluding unconsolidated entities, respectively.~~ The table below summarizes communities reviewed for indicators of impairment and communities with valuation adjustments recorded:

Communities with valuation adjustments
# of communities with potential indicator of impairment # of communities Fair Value
(in thousands) Valuation Adjustments
(in thousands)
At and for the Six Months Ended
May 31, 2020 41 9 $69,137 $32,072
May 31, 2019 52 — — —


			Communities with valuation adjustments
	# of active communities	# of communities with potential indicator of impairment	# of communities	Fair Value (in thousands)		Valuation Adjustments (in thousands)
At or for the Six Months Ended
May 31, 2021	1,221	10	1	$	17,117	$	11,849
May 31, 2020	1,241	41	9	69,137		32,072

The table below summarizes the most significant unobservable inputs used in the Company's discounted cash flow model to determine the fair value of its communities for which the Company recorded valuation adjustments:


							Six Months Ended
		Six Months Ended							May 31,
		May 31, 2020							2021	2020
Unobservable inputs	Unobservable inputs	Range						Unobservable inputs		Range
Average selling price	Average selling price	$	201,000	-	$970,000	Average selling price	$635,000			201,000	-	970,000
Absorption rate per quarter (homes)	Absorption rate per quarter (homes)	3		-	15	Absorption rate per quarter (homes)	11			3	-	15
Discount rate	Discount rate	20%						Discount rate	20%	20%

(10)Variable Interest Entities

The Company evaluated the joint venture ("JV") agreements of its JV's that were formed or that had reconsideration events, such as changes in the governing documents or to debt arrangements during the six months ended May 31, ~~2020. Based~~2021 and based on the Company's evaluation, ~~the Company~~there were no VIEs that were consolidated 1 Multifamily entity that had a total assets and liabilities of $49.4 million and $0.9 million, respectively and deconsolidated 2 Multifamily entities that had total assets of $37.2 million and an immaterial amount of liabilities. In addition, the Company's Financial Services segment deconsolidated 1 entity that had total assets and liabilities of $291.2 million and $204.1 million, respectively. In January 2019, this JV was formed by the sale of the Company’s retail title agency and its retail title insurance business to this JV entity. In exchange for the sale of the retail agency and retail title insurance business, the Company received 20% of the JV entity’s preferred stock, warrants exercisable to purchase additional shares of preferred stock in the JV entity and a note due from the JV to the Company. The JV entity’s reconsideration event was due to a significant equity raise that was completed during the three months ended May 31, 2020. The proceeds of the equity raise resulted in approximately a 43% reduction of the principal amount of debt owed by the JV entity to the Company as well as an approximately 20% reduction of the Company’s ownership interest in the JV. The JV remains a VIE; however, the Company has concluded that it is no longer the primary beneficiary as the Company no longer has the power to direct the VIE. In particular, the additional infusion of equity from third party investors provides evidence that the JV entity is no longer financially dependent on the Company. The Company does not have the voting or economic power to direct the activities of the JV entity. As a result, the Company concluded that the JV entity should be deconsolidated which required fair value accounting for its equity investment and note receivable. The valuation assumptions used in determining fair value of the equity investment began by utilizing the capital raise discounted by public company comparable transactions that took into account the impact of COVID-19 and the economic shutdown and the lack of marketability of the Company’s investment. The valuation of the note receivable utilized the underlying cash flows and applied a discount, which was determined by using market comparables. The Company used discount rates ranging from 16% to 30% for the fair valuedeconsolidated.

2422

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

calculations. In aggregate, the resulting fair value of the equity investment and note receivable totaled $123.4 million, of which $70.8 million is included in Financial Services investments in unconsolidated entities. Upon deconsolidation, the Company recorded a gain of $61.4 million.

The carrying amount of ~~our~~the Company's consolidated VIE's assets and non-recourse liabilities are disclosed in the footnote to the condensed consolidated balance sheets.

A VIE’s assets can only be used to settle obligations of that VIE. The VIEs are not guarantors of the Company’s senior notes or other debts payable. The assets held by a VIE usually are collateral for that VIE’s debt. The Company and other partners do not generally have an obligation to make capital contributions to a VIE unless the Company and/or the other partner(s) have entered into debt guarantees with a VIE’s lenders. Other than debt guarantee agreements with a VIE’s lenders, there are no liquidity arrangements or agreements to fund capital or purchase assets that could require the Company to provide financial support to a VIE. While the Company has option contracts to purchase land from certain of its VIEs, the Company is not required to purchase the assets and could walk away from the contracts.

Unconsolidated VIEs

~~At May 31, 2020 and November 30, 2019, the~~The Company’s recorded investments in VIEs that are unconsolidated and its estimated maximum exposure to loss were as follows:


		May 31, 2020				November 30, 2019					May 31, 2021		November 30, 2020
(In thousands)	(In thousands)	Investments in Unconsolidated VIEs		Lennar’s Maximum Exposure to Loss (1)	Investments in Unconsolidated VIEs	Lennar’s Maximum Exposure to Loss (1)	(In thousands)	Investments in Unconsolidated VIEs		Lennar’s Maximum Exposure to Loss	Investments in Unconsolidated VIEs	Lennar’s Maximum Exposure to Loss
Homebuilding(1)	Homebuilding(1)	$	79,553	79,714	80,939	81,118	Homebuilding(1)	$	94,264	214,014	89,654	89,828
Multifamily (2)	Multifamily (2)	578,026		759,633	533,018	768,651	Multifamily (2)	624,440		681,992	619,540	717,271
Financial Services ~~(3)~~	Financial Services ~~(3)~~	235,626		286,608	166,012	166,012	Financial Services ~~(3)~~	162,919		162,919	164,230	164,230
Lennar Other(3)	Lennar Other(3)	7,148		7,148	60,882	60,882	Lennar Other(3)	46,223		46,223	76,023	130,177
		$	900,353	1,133,103	840,851	1,076,663		$	927,846	1,105,148	949,447	1,101,506

(1)~~Limited~~As of May 31, 2021 and November 30, 2020, the maximum exposure to loss of Homebuilding's investments in unconsolidated VIEs was limited to its investments in unconsolidated VIEs, except as ~~noted below.~~of May 31, 2021, with regard to the Company's remaining commitment to fund capital in the Upward America Venture, a single family for rent platform.

(2)As of May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, the maximum exposure to loss of Multifamily's investments in unconsolidated VIEs was primarily limited to its investments in the unconsolidated VIEs, except with regard to the remaining equity commitment of ~~$163.9~~$34.7 million and ~~$224.2~~$88.1 million, respectively, to fund LMV I and LMV II for future expenditures related to the construction and development of its projects.

(3)As of May 31, ~~2020,~~2021, the decrease in investments in unconsolidated VIEs and maximum exposure to loss was related to an entity which had a reconsideration event due to the payoff of ~~Financial Services' investments in unconsolidated entities included~~ a note ~~receivable.~~receivable which caused the entity to no longer be considered a VIE.

While these entities are VIEs, the Company has determined that the power to direct the activities of the VIEs that most significantly impact the VIEs’ economic performance is generally shared and the Company and its partners are not de-facto agents. While the Company generally manages the day-to-day operations of the VIEs, each of these VIEs has an executive committee made up of representatives from each partner. The members of the executive committee have equal votes and major decisions require unanimous consent and approval from all members. The Company does not have the unilateral ability to exercise participating voting rights without partner consent.

There are no liquidity arrangements or agreements to fund capital or purchase assets that could require the Company to provide financial support to the VIEs. Except for the unconsolidated VIEs discussed above, the Company and the other partners did not guarantee any debt of the other unconsolidated VIEs. While the Company has option contracts to purchase land from certain of its unconsolidated VIEs, the Company is not required to purchase the assets and could walk away from the contracts.

Option Contracts

The Company has access to land through option contracts, which generally enable it to control portions of properties owned by third parties (including land funds) and unconsolidated entities until the Company has determined whether to exercise the options.

The Company evaluates all option contracts for land to determine whether they are VIEs and, if so, whether the Company is the primary beneficiary of certain of these option contracts. Although the Company does not have legal title to the optioned land, if the Company is deemed to be the primary beneficiary or makes a significant deposit for optioned land, it may need to consolidate the land under option at the purchase price of the optioned land.

During the six months ended May 31, ~~2020,~~2021, consolidated inventory not owned increased by ~~$86.7~~$73.4 million with a corresponding increase to liabilities related to consolidated inventory not owned in the accompanying condensed consolidated balance sheet as of May 31, ~~2020.~~2021. The increase was primarily ~~related~~due to additions in the ~~consolidation of option contracts, partially offset by~~six months ended May 31, 2021 as the Company ~~exercising~~focused on increasing its ~~options to acquire land under previously consolidated contracts.~~controlled homesites. To reflect the purchase price of the ~~inventory consolidated,~~homesite takedowns, the Company had a net reclass related to option deposits from consolidated inventory not owned to land under development in the accompanying condensed consolidated balance sheet as of May 31, 2021. The liabilities related to consolidated inventory not

2523

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

~~under development in the accompanying condensed consolidated balance sheet as of May 31, 2020. 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~~Company's exposure to losses ~~related to~~on its option contracts with third parties and unconsolidated entities consisted of its non-refundable option deposits and pre-acquisition costs totaling $282.1 million and $320.5 million at May 31, 2020 and November 30, 2019, respectively. Additionally, the Company had posted $72.5 million and $75.0 million of letters of credit in lieu of cash deposits under certain land and option contractswere as of May 31, 2020 and November 30, 2019, respectively. As a result of the COVID-19 pandemic, the Company reviewed its option contracts as of May 31, 2020 and had no write-offs of costs related to option contracts because of the COVID-19 pandemic during the three months ended May 31, 2020.follows:


(Dollars in thousands)	May 31, 2021		November 30, 2020
Non-refundable option deposits and pre-acquisition costs	$	891,910	414,154
Letters of credit in lieu of cash deposits under certain land and option contracts	138,244		87,537

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

(11)Commitments and Contingent Liabilities

The Company is a party to various claims, legal actions and complaints arising in the ordinary course of business. In the opinion of management, the disposition of these matters will not have a material adverse effect on the Company’s consolidated financial statements. ~~The~~From time to time, the Company is also a party to various lawsuits involving purchases and sales of real property. These lawsuits include claims regarding representations and warranties made in connection with the transfer of properties and disputes regarding the obligation to purchase or sell properties.

The Company does not believe that the ultimate resolution of these claims or lawsuits will have a material adverse effect on its business or financial position. However, the financial effect of litigation concerning purchases and sales of property may depend upon the value of the subject property, which may have changed from the time the agreement for purchase or sale was entered into.

Leases

The Company has entered into agreements to lease certain office facilities and equipment under operating leases. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. ROU assets and right-of-use lease liabilities are recorded on the balance sheet for all leases, except leases with an initial term of 12 months or less. Many of the Company's leases include options to renew. The exercise of lease renewal options is at the Company's option and therefore renewal option payments have not been included in the ROU assets or lease liabilities. The following table includes additional information about the Company's leases:


~~(Dollars in thousands)~~	~~May 31, 2020~~
~~Right-of-use assets~~	$	~~128,423~~
~~Lease liabilities~~	$	~~137,795~~
~~Weighted-average remaining lease term (in years)~~	~~2.9~~
~~Weighted-average discount rate~~	~~3.0~~		%


(Dollars in thousands)	May 31, 2021			November 30, 2020
Right-of-use assets	$	157,444		113,390
Lease liabilities	165,761			122,836
Weighted-average remaining lease term (in years)	8.4			2.9
Weighted-average discount rate	3.0		%	3.1	%

~~The Company has entered into agreements to lease certain office facilities and equipment under operating leases.~~ Future minimum payments under the noncancellable leases in effect at May 31, ~~2020~~2021 were as follows:


(Dollars in thousands)		Lease Payments
2020		$	17,791
(In thousands)				(In thousands)	Lease Payments
2021	2021	36,544		2021	$	17,932
2022	2022	28,543		2022	32,834
2023	2023	21,349		2023	26,699
2024	2024	15,429		2024	21,552
2025 and thereafter		30,004
2025				2025	17,530
2026 and thereafter				2026 and thereafter	71,177
Total future minimum lease payments (1)	Total future minimum lease payments (1)	$	149,660	Total future minimum lease payments (1)	$	187,724
Less: Interest (2)	Less: Interest (2)	11,865		Less: Interest (2)	21,963
Present value of lease liabilities (2)	Present value of lease liabilities (2)	$	137,795	Present value of lease liabilities (2)	$	165,761

(1)Total future minimum lease payments exclude variable lease costs of ~~$11.3~~$12.9 million and short-term lease costs of ~~$2.3~~$1.7 million. This also does not include minimum lease payments for executed and legally enforceable leases that have not yet commenced. As of May 31, ~~2020,~~2021, the minimum lease payments for these leases that have not yet commenced were immaterial.

(2)The Company's leases do not include a readily determinable implicit rate. As such, the Company has estimated the discount rate for these leases to determine the present value of lease payments at the lease commencement date or as of December 1, 2019, which was the effective date of ASU 2016-02. As of May 31, 2021, the weighted average remaining lease term and weighted average discount rate used in calculating the lease liabilities were 8.4 years and 3.0%, respectively. The Company recognized the lease liabilities on its condensed consolidated balance sheets within accounts payable or other ~~liabilities.~~liabilities of the respective segments.

~~Rental~~The Company's rental expense ~~for the six months ended May 31, 2020 was $41.1 million. Payments~~and payments on lease liabilities during the six months ended May 31, 2020 totaled $29.0 million. Rental expense includes costs for all leases. On occasion, the Company may sublease rented space which is no longer used for the Company's operations. For the six months ended May 31, 2020, the Company had an immaterial amount of sublease income.were as follows:

~~(12)New Accounting Pronouncements~~

~~In June 2016, the FASB issued ASU 2016-13,~~ ~~Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments~~ ("ASU 2016-13"). ASU 2016-13 significantly changes the impairment model for most financial assets and certain other instruments. ASU 2016-13 will require immediate recognition of estimated credit losses expected to occur over the remaining life of many financial assets, which will generally result in earlier recognition of


	Six months ended
(In thousands)	May 31, 2021		May 31, 2020
Rental expense	$	41,662	41,131
Payment on lease liabilities	18,122		28,958

2724

Lennar Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)

~~allowances for credit losses on loans and other financial instruments. ASU 2016-13~~On occasion, the Company may sublease rented space which is ~~effective~~no longer used for the Company's ~~fiscal year beginning December 1,~~operations. For both the six months ended May 31, 2021 and 2020, ~~and subsequent interim periods. The~~the Company ~~is currently evaluating the impact the adoption of ASU 2016-13 will have on its condensed consolidated financial statements. Subsequent to the issuance of ASU 2016-13, the FASB issued ASU 2018-19,~~ ~~Codification Improvements to Topic 326, Financial Instruments —Credit Losses~~ ~~and ASU 2019-05,~~ ~~Financial Instruments —Credit Losses (Topic 326) Targeted Transition Relief~~. These ASUs do not change the core principle of the guidance in ASU 2016-13. Instead these amendments are intended to clarify and improve operability of certain topics included within the credit losses standard. These ASUs will have the same effective date and transition requirements as ASU 2016-13.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Accounting for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 removes the requirement to perform a hypothetical purchase price allocation to measure goodwill impairment. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carryinghad an immaterial amount of goodwill. ASU 2017-04 will be effective for the Company’s fiscal year beginning December 1, 2020. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact the adoption of ASU 2017-04 will have on the Company's condensed consolidated financial statements.

~~In December 2019, the FASB issued ASU 2019-12,~~ ~~Income Taxes~~ ~~(Topic 740),~~ ~~Simplifying the Accounting for Income Taxes~~ ("ASU 2019-12"). ASU 2019-12 will be effective for the Company’s fiscal year beginning December 1, 2022. The Company is currently evaluating the impact the adoption of ASU 2019-12 will have on the Company's condensed consolidated financial statements.

~~(13)Supplemental Financial Information~~

The indentures governing the Company’s senior notes require that, if any of the Company’s 100% owned subsidiaries, other than its finance company subsidiaries and foreign subsidiaries, directly or indirectly guarantee at least $75 million principal amount of debt of Lennar Corporation, those subsidiaries must also guarantee Lennar Corporation’s obligations with regard to its senior notes. The entities referred to as "guarantors" in the following tables are subsidiaries that are not finance company subsidiaries or foreign subsidiaries and were guaranteeing the senior notes because at May 31, 2020 they were guaranteeing Lennar Corporation's letter of credit facilities and its Credit Facility, disclosed in Note 7 of the Notes to the Condensed Consolidated Financial Statements. The guarantees are full, unconditional and joint and several and the guarantor subsidiaries are 100% directly or indirectly owned by Lennar Corporation. A subsidiary's guarantee of Lennar senior notes will be suspended at any time when it is not directly or indirectly guaranteeing at least $75 million principal amount of debt of Lennar Corporation, and a subsidiary will be released from its guarantee and any other obligations it may have regarding the senior notes if all or substantially all its assets, or all of its capital stock, are sold or otherwise disposed of.

For purposes of the condensed consolidating statement of cash flows included in the following supplemental financial information, the Company's accounting policy is to treat cash received by Lennar Corporation (the "Parent") from its subsidiaries, to the extent of net earnings from such subsidiaries as a dividend and accordingly a return on investment within cash flows from operating activities. Distributions of capital received by the Parent from its subsidiaries are reflected as cash flows from investing activities. The cash outflows associated with the return on investment dividends and distributions of capital received by the Parent are reflected by the Guarantor and Non-Guarantor subsidiaries in the Dividends line item within cash flows from financing activities. All other cash flows between the Parent and its subsidiaries represent the settlement of receivables and payables between such entities in conjunction with the Parent's centralized cash management arrangement with its subsidiaries, which operates with the characteristics of a revolving credit facility, and are accordingly reflected net in the Intercompany line item within cash flows from investing activities for the Parent and net in the Intercompany line item within cash flows from financing activities for the Guarantor and Non-Guarantor subsidiaries.

~~Supplemental information for the subsidiaries that were guarantor subsidiaries at May 31, 2020 was as follows:~~

sublease income.

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Balance Sheet~~

~~May 31, 2020~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
ASSETS
Homebuilding:
Cash and cash equivalents, restricted cash and receivables, net $ 1,000,333 695,182 12,230 — 1,707,745
Inventories — 17,528,852 418,554 — 17,947,406
Investments in unconsolidated entities — 971,058 1,986 — 973,044
Goodwill — 3,442,359 — — 3,442,359
Other assets 392,355 468,610 251,743 (32,522) 1,080,186
Investments in subsidiaries 10,270,732 21,757 — (10,292,489) —
Intercompany 12,267,017 — — (12,267,017) —
23,930,437 23,127,818 684,513 (22,592,028) 25,150,740
Financial Services — 249,999 2,329,154 (1,348) 2,577,805
Multifamily — — 1,127,929 — 1,127,929
Lennar Other — 187,352 281,789 (16,590) 452,551
Total assets $ 23,930,437 23,565,169 4,423,385 (22,609,966) 29,309,025
LIABILITIES AND EQUITY
Homebuilding:
Accounts payable and other liabilities $ 832,049 1,821,132 331,807 (50,460) 2,934,528
Liabilities related to consolidated inventory not owned — 344,074 — — 344,074
Senior notes and other debts payable 6,555,685 865,539 74,450 — 7,495,674
Intercompany — 10,145,745 2,121,272 (12,267,017) —
7,387,734 13,176,490 2,527,529 (12,317,477) 10,774,276
Financial Services — 30,344 1,633,204 — 1,663,548
Multifamily — — 222,387 — 222,387
Lennar Other — — 16,190 — 16,190
Total liabilities 7,387,734 13,206,834 4,399,310 (12,317,477) 12,676,401
Total stockholders’ equity 16,542,703 10,358,335 (65,846) (10,292,489) 16,542,703
Noncontrolling interests — — 89,921 89,921
Total equity 16,542,703 10,358,335 24,075 (10,292,489) 16,632,624
Total liabilities and equity $ 23,930,437 23,565,169 4,423,385 (22,609,966) 29,309,025

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Balance Sheet~~

~~November 30, 2019~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
ASSETS
Homebuilding:
Cash and cash equivalents, restricted cash and receivables, net $ 722,172 794,588 22,894 — 1,539,654
Inventories — 17,396,139 380,368 — 17,776,507
Investments in unconsolidated entities — 1,006,541 2,494 — 1,009,035
Goodwill — 3,442,359 — — 3,442,359
Other assets 344,941 500,356 217,607 (41,220) 1,021,684
Investments in subsidiaries 10,453,165 26,773 — (10,479,938) —
Intercompany 12,027,996 — — (12,027,996) —
23,548,274 23,166,756 623,363 (22,549,154) 24,789,239
Financial Services — 275,812 2,731,285 (1,073) 3,006,024
Multifamily — — 1,068,831 — 1,068,831
Lennar Other — 158,194 339,988 (2,765) 495,417
Total assets $ 23,548,274 23,600,762 4,763,467 (22,552,992) 29,359,511
LIABILITIES AND EQUITY
Homebuilding:
Accounts payable and other liabilities $ 760,981 1,935,366 318,845 (45,058) 2,970,134
Liabilities related to consolidated inventory not owned — 260,266 — — 260,266
Senior notes and other debts payable 6,837,776 885,783 53,079 — 7,776,638
Intercompany — 10,122,374 1,905,622 (12,027,996) —
7,598,757 13,203,789 2,277,546 (12,073,054) 11,007,038
Financial Services — 40,235 2,016,215 — 2,056,450
Multifamily — — 232,155 — 232,155
Lennar Other — — 30,038 — 30,038
Total liabilities 7,598,757 13,244,024 4,555,954 (12,073,054) 13,325,681
Total stockholders’ equity 15,949,517 10,356,738 123,200 (10,479,938) 15,949,517
Noncontrolling interests — — 84,313 — 84,313
Total equity 15,949,517 10,356,738 207,513 (10,479,938) 16,033,830
Total liabilities and equity $ 23,548,274 23,600,762 4,763,467 (22,552,992) 29,359,511

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)~~

~~Three Months Ended May 31, 2020~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
Revenues:
Homebuilding $ — 4,939,857 9,627 — 4,949,484
Financial Services — 35,534 166,712 (5,983) 196,263
Multifamily — — 123,117 — 123,117
Lennar Other — — 18,509 — 18,509
Total revenues — 4,975,391 317,965 (5,983) 5,287,373
Cost and expenses:
Homebuilding — 4,302,960 13,304 (2,933) 4,313,331
Financial Services — 21,146 93,176 (3,967) 110,355
Multifamily — — 123,473 — 123,473
Lennar Other — — (1,072) — (1,072)
Corporate general and administrative 80,544 1,641 — 1,266 83,451
Total costs and expenses 80,544 4,325,747 228,881 (5,634) 4,629,538
Homebuilding equity in earnings (loss) from unconsolidated entities — (9,222) 122 — (9,100)
Homebuilding other income (expense), net (349) 2,809 1,499 349 4,308
Financial Services gain on deconsolidation — 61,418 — — 61,418
Multifamily equity in loss from unconsolidated entities — — (282) — (282)
Lennar Other equity in loss from unconsolidated entities — (3,922) (22,720) — (26,642)
Lennar Other income (expense), net — 6 (10,966) — (10,960)
Earnings (loss) before income taxes (80,893) 700,733 56,737 — 676,577
Benefit (provision) for income taxes 22,411 (165,874) (17,016) — (160,479)
Equity in earnings from subsidiaries 575,888 56,130 — (632,018) —
Net earnings (including net loss attributable to noncontrolling interests) 517,406 590,989 39,721 (632,018) 516,098
Less: Net loss attributable to noncontrolling interests — — (1,308) — (1,308)
Net earnings attributable to Lennar $ 517,406 590,989 41,029 (632,018) 517,406
Other comprehensive loss, net of tax:
Net unrealized loss on securities available-for-sale $ — — (338) — (338)
Reclassification adjustments for gains included in earnings, net of tax — — (452) — (452)
Total other comprehensive loss, net of tax $ — — (790) — (790)
Total comprehensive income attributable to Lennar $ 517,406 590,989 40,239 (632,018) 516,616
Total comprehensive loss attributable to noncontrolling interests $ — — (1,308) — (1,308)

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)~~

~~Three Months Ended May 31, 2019~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
Revenues:
Homebuilding $ — 5,175,289 20,310 — 5,195,599
Financial Services — 36,353 172,729 (4,866) 204,216
Multifamily — — 147,412 — 147,412
Lennar Other — — 15,663 — 15,663
Total revenues — 5,211,642 356,114 (4,866) 5,562,890
Cost and expenses:
Homebuilding — 4,561,235 19,594 6,430 4,587,259
Financial Services — 20,829 139,510 (12,340) 147,999
Multifamily — — 148,716 — 148,716
Lennar Other — — 3,194 — 3,194
Corporate general and administrative 74,321 527 — 1,265 76,113
Total costs and expenses 74,321 4,582,591 311,014 (4,645) 4,963,281
Homebuilding equity in earnings from unconsolidated entities — 19,537 77 — 19,614
Homebuilding other income (expense), net (222) (48,550) 2,386 221 (46,165)
Multifamily equity in loss from unconsolidated entities and other gain — — (3,018) — (3,018)
Lennar Other equity in loss from unconsolidated entities — (4,239) (739) — (4,978)
Lennar Other expense, net — — (5,663) — (5,663)
Earnings (loss) before income taxes (74,543) 595,799 38,143 — 559,399
Benefit (provision) for income taxes 18,653 (148,736) (10,447) — (140,530)
Equity in earnings from subsidiaries 477,362 28,703 — (506,065) —
Net earnings (including net loss attributable to noncontrolling interests) 421,472 475,766 27,696 (506,065) 418,869
Less: Net loss attributable to noncontrolling interests — — (2,603) — (2,603)
Net earnings attributable to Lennar $ 421,472 475,766 30,299 (506,065) 421,472
Other comprehensive income, net of tax:
Net unrealized gain on securities available-for-sale $ — — 561 — 561
Reclassification adjustments for gains included in net earnings, net of tax — — (176) — (176)
Total other comprehensive income, net of tax $ — — 385 — 385
Total comprehensive income attributable to Lennar $ 421,472 475,766 30,684 (506,065) 421,857
Total comprehensive loss attributable to noncontrolling interests $ — — (2,603) — (2,603)

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)~~

~~Six Months Ended May 31, 2020~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
Revenues:
Homebuilding $ — 9,096,000 25,600 — 9,121,600
Financial Services — 64,528 342,365 (11,969) 394,924
Multifamily — — 255,734 — 255,734
Lennar Other — — 20,452 — 20,452
Total revenues — 9,160,528 644,151 (11,969) 9,792,710
Cost and expenses:
Homebuilding — 7,987,657 30,647 (7,167) 8,011,137
Financial Services — 37,599 230,727 (6,627) 261,699
Multifamily — — 260,821 — 260,821
Lennar Other — — 1,502 — 1,502
Corporate general and administrative 164,554 3,213 — 2,531 170,298
Total costs and expenses 164,554 8,028,469 523,697 (11,263) 8,705,457
Homebuilding equity in earnings (loss) from unconsolidated entities — (13,956) 310 — (13,646)
Homebuilding other income (expense), net (706) (8,239) 3,181 706 (5,058)
Financial Services gain on deconsolidation — 61,418 — — 61,418
Multifamily equity in earnings from unconsolidated entities and other gain — — 6,234 — 6,234
Lennar Other equity in loss from unconsolidated entities — (8,852) (17,671) — (26,523)
Lennar Other income (expense), net — 6 (9,555) — (9,549)
Earnings (loss) before income taxes (165,260) 1,162,436 102,953 — 1,100,129
Benefit (provision) for income taxes 28,739 (191,711) (29,836) — (192,808)
Equity in earnings from subsidiaries 1,052,379 80,835 — (1,133,214) —
Net earnings (including net loss attributable to noncontrolling interests) 915,858 1,051,560 73,117 (1,133,214) 907,321
Less: Net loss attributable to noncontrolling interests — — (8,537) — (8,537)
Net earnings attributable to Lennar $ 915,858 1,051,560 81,654 (1,133,214) 915,858
Other comprehensive loss, net of tax:
Net unrealized loss on securities available-for-sale $ — — (384) — (384)
Reclassification adjustments for gain included in earnings, net of tax — — (452) — (452)
Total other comprehensive loss, net of tax $ — — (836) — (836)
Total comprehensive income attributable to Lennar $ 915,858 1,051,560 80,818 (1,133,214) 915,022
Total comprehensive loss attributable to noncontrolling interests $ — — (8,537) — (8,537)

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)~~

~~Six Months Ended May 31, 2019~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
Revenues:
Homebuilding $ — 8,789,330 29,990 — 8,819,320
Financial Services — 85,270 271,978 (9,721) 347,527
Multifamily — — 244,806 — 244,806
Lennar Other — — 19,319 — 19,319
Total revenues — 8,874,600 566,093 (9,721) 9,430,972
Cost and expenses:
Homebuilding — 7,787,164 31,901 7,029 7,826,094
Financial Services — 59,207 231,778 (18,647) 272,338
Multifamily — — 249,894 — 249,894
Lennar Other — — 4,816 — 4,816
Corporate general and administrative 151,850 1,076 — 2,530 155,456
Total costs and expenses 151,850 7,847,447 518,389 (9,088) 8,508,598
Homebuilding equity in earnings from unconsolidated entities — 5,586 272 — 5,858
Homebuilding other income (expense), net (630) (50,946) 3,243 633 (47,700)
Multifamily equity in earnings from unconsolidated entities — — 7,563 — 7,563
Lennar Other equity in earnings (loss) from unconsolidated entities — (7,585) 10,937 — 3,352
Lennar Other expense, net — — (12,924) — (12,924)
Earnings (loss) before income taxes (152,480) 974,208 56,795 — 878,523
Benefit (provision) for income taxes 38,090 (242,575) (15,745) — (220,230)
Equity in earnings from subsidiaries 775,772 33,476 — (809,248) —
Net earnings (including net earnings attributable to noncontrolling interests) 661,382 765,109 41,050 (809,248) 658,293
Less: Net loss attributable to noncontrolling interests — — (3,089) — (3,089)
Net earnings attributable to Lennar $ 661,382 765,109 44,139 (809,248) 661,382
Other comprehensive loss, net of tax:
Net unrealized gain on securities available-for-sale $ — — 769 — 769
Reclassification adjustments for gains included in earnings, net of tax — — (176) — (176)
Total other comprehensive income, net of tax $ — — 593 — 593
Total comprehensive income attributable to Lennar $ 661,382 765,109 44,732 (809,248) 661,975
Total comprehensive loss attributable to noncontrolling interests $ — — (3,089) — (3,089)

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Statement of Cash Flows~~

~~Six Months Ended May 31, 2020~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
Cash flows from operating activities:
Net earnings (including net loss attributable to noncontrolling interests) $ 915,858 1,051,560 73,117 (1,133,214) 907,321
Distributions of earnings from guarantor and non-guarantor subsidiaries 1,052,379 80,835 — (1,133,214) —
Other adjustments to reconcile net earnings (including net loss attributable to noncontrolling interests) to net cash provided by operating activities (980,620) (149,064) 399,952 1,133,214 403,482
Net cash provided by operating activities 987,617 983,331 473,069 (1,133,214) 1,310,803
Cash flows from investing activities:
Investments in and contributions to unconsolidated entities/deconsolidation of a previously consolidated entity, net of distributions of capital — (17,986) (169,705) — (187,691)
Proceeds from the sales of operating properties and equipment and other assets — 29,727 — — 29,727
Other (1,767) 28,454 (42,765) — (16,078)
Intercompany (58,949) — — 58,949 —
Net cash provided by (used in) investing activities (60,716) 40,195 (212,470) 58,949 (174,042)
Cash flows from financing activities:
Net borrowings (repayments) under warehouse facilities — 404 (310,620) — (310,216)
Net borrowings (repayments) on senior notes, other borrowings, other liabilities, and other notes payable (267,708) (123,505) 127,097 — (264,116)
Common stock:
Repurchases (296,093) — — — (296,093)
Dividends (78,145) (1,051,560) (81,654) 1,133,214 (78,145)
Intercompany — 39,591 19,358 (58,949) —
Net cash used in financing activities (641,946) (1,135,070) (245,819) 1,074,265 (948,570)
Net increase (decrease) in cash and cash equivalents and restricted cash 284,955 (111,544) 14,780 — 188,191
Cash and cash equivalents and restricted cash at beginning of period 713,828 532,304 222,559 — 1,468,691
Cash and cash equivalents and restricted cash at end of period $ 998,783 420,760 237,339 — 1,656,882

~~Lennar Corporation and Subsidiaries~~

~~Notes to Condensed Consolidated Financial Statements (unaudited) (Continued)~~

~~Condensed Consolidating Statement of Cash Flows~~

~~Six Months Ended May 31, 2019~~

(In thousands) Lennar
Corporation Guarantor
Subsidiaries Non-Guarantor
Subsidiaries Consolidating Adjustments Total
Cash flows from operating activities:
Net earnings (including net loss attributable to noncontrolling interests) $ 661,382 765,109 41,050 (809,248) 658,293
Distributions of earnings from guarantor and non-guarantor subsidiaries 775,772 33,476 — (809,248) —
Other adjustments to reconcile net earnings (including net loss attributable to noncontrolling interests) to net cash provided by (used in) operating activities (819,869) (1,222,713) 145,151 809,248 (1,088,183)
Net cash provided by (used in) operating activities 617,285 (424,128) 186,201 (809,248) (429,890)
Cash flows from investing activities:
Investments in and contributions to unconsolidated entities, net of distributions of capital — (99,052) 11,716 — (87,336)
Proceeds from sales of real estate owned — — 4,210 — 4,210
Proceeds from sale of investment in unconsolidated entity — — 17,790 — 17,790
Proceeds from sales of Financial Services' businesses — 21,317 3,129 — 24,446
Other (170) (30,185) (20,341) — (50,696)
Intercompany (1,263,527) — — 1,263,527 —
Net cash provided by (used in) investing activities (1,263,697) (107,920) 16,504 1,263,527 (91,586)
Cash flows from financing activities:
Net borrowings under unsecured revolving credit facilities 550,000 — — — 550,000
Net borrowings (repayments) under warehouse facilities — 170 (365,354) — (365,184)
Net borrowings (repayments) on convertible senior notes, other borrowings, other liabilities, and other notes payable — (101,052) 3,657 — (97,395)
Net repayments related to noncontrolling interests — — (14,380) — (14,380)
Common stock:
Issuances 634 — — — 634
Repurchases (101,229) — — — (101,229)
Dividends (25,877) (765,109) (44,139) 809,248 (25,877)
Intercompany — 1,057,135 206,392 (1,263,527) —
Net cash provided by (used in) financing activities 423,528 191,144 (213,824) (454,279) (53,431)
Net decrease in cash and cash equivalents and restricted cash (222,884) (340,904) (11,119) — (574,907)
Cash and cash equivalents and restricted cash at beginning of period 624,694 721,603 249,681 — 1,595,978
Cash and cash equivalents and restricted cash at end of period $ 401,810 380,699 238,562 — 1,021,071

3625

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and accompanying notes included under Item 1 of this Report and our audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K, for our fiscal year ended November 30, ~~2019.~~2020.

Some of the statements in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, and elsewhere in this Quarterly Report on Form 10-Q, are "forward-looking statements," within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements typically include the words “anticipate,” “believe,” “consider,” “estimate,” “expect,” “forecast,” “intend,” “objective,” “plan,” “predict,” “projection,” “seek,” “strategy,” “target,” “will” or other words of similar meaning. Forward-looking statements contained herein may include opinions or beliefs regarding market conditions and similar matters. In many instances, those opinions and beliefs are based upon general observations by members of our management, anecdotal evidence and our experience in the conduct of our businesses, without specific investigation or analyses. Therefore, while they reflect our view of the industries and markets in which we are involved, they should not be viewed as reflecting verifiable views or views that are necessarily shared by all who are involved in those industries or markets. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. These forward-looking statements typically include the words “anticipate,” “believe,” “consider,” “estimate,” “expect,” “forecast,” “intend,” “objective,” “plan,” “predict,” “projection,” “seek,” “strategy,” “target,” “will” or other words of similar meaning.

~~These~~The forward-looking statements reflect our current views about future events and are subject to risks, uncertainties and assumptions. We wish to caution readers that certain important factors may have affected and could in the future affect our actual results and could cause actual results to differ significantly from what is anticipated by our forward-looking statements. The most important factors that could cause actual results to differ materially from those anticipated by our forward-looking statements include, but are not limited to: the potential ~~continuing~~ negative impact to our business of the ongoing coronavirus ~~("COVID-19"~~(“COVID-19”) pandemic, the duration, impact and severity of which is highly uncertain; ~~an extended slowdown in the real estate markets across the nation, including a slowdown in the market for single family homes or the multifamily rental market;~~ increases in operating costs, including costs related to construction materials, labor, real estate taxes and insurance, and our inability to manage our cost structure, both in our Homebuilding and Multifamily businesses; an extended slowdown in the real estate markets across the nation, including a slowdown in the market for single family homes or the multifamily rental market; reduced availability of mortgage financing or increased interest rates; our inability to successfully execute our strategies, including our land lighter ~~strategy;~~strategy and our planned spin-off of certain businesses; changes in general economic and financial conditions that reduce demand for our products and services, lower our profit margins or reduce our access to credit; our inability to acquire land at anticipated prices; the possibility that we will incur nonrecurring costs that affect earnings in one or more reporting periods; decreased demand for our homes or Multifamily rental properties; the possibility that the benefit from our increasing use of technology will not justify its cost; increased competition for home sales from other sellers of new and resale homes; our inability to pay down debt; whether government actions or other factors ~~related to COVID-19~~ force us to ~~delay or~~ terminate our program of repurchasing our stock; a decline in the value of our land inventories and resulting write-downs of the carrying value of our real estate assets; the failure of the participants in various joint ventures to honor their commitments; difficulty obtaining land-use entitlements or construction financing; natural disasters and other unforeseen events for which our insurance does not provide adequate coverage; new laws or regulatory changes that adversely affect the profitability of our businesses; our inability to refinance our debt on terms that are acceptable to us; and changes in accounting conventions that adversely affect our reported earnings.

Please see our Form 10-K for the fiscal year ended November 30, ~~2019~~2020 and our other filings with the SEC for a further discussion of these and other risks and uncertainties which could affect our future results. We undertake no obligation, other than those imposed by securities laws, to publicly revise any forward-looking statements to reflect events or circumstances after the date of those statements or to reflect the occurrence of anticipated or unanticipated events.

~~Outlook~~

Early in the second quarter, the economy was shuttering and unemployment was rising rapidly as the coronavirus (“COVID-19”) pandemic was dramatically affecting the United States economy in general and our business specifically. While the economy is still trying to recover after the shut-down, the homebuilding industry only stalled from mid-March through April. By the end of April, most states and municipalities across the country had deemed housing an essential service, which enabled us to continue building, selling, and delivering homes to our customers. During May and for the first few weeks of June, the market for new homes had steadily strengthened in almost all areas where we have communities under development. We believe this is the result of low interest rates and short supply, together with what appears to be a desire by many people to move out of crowded urban areas into new homes in the suburbs. The strength in the market may also be partially attributable to pent up demand from the earlier part of our second quarter when more restrictive stay at home orders were in place in many of our markets and when public concern over COVID-19 was much greater.

Our first priority with regard to the COVID-19 pandemic was to do everything we could to ensure the safety, health and hygiene of our associates, customers, suppliers and others with whom we partner in our business activities. We, like many

~~businesses, required or permitted many~~Outlook

The housing market remains very strong. Demand has continued to strengthen while the supply of ~~our associates~~new and existing homes has remained constrained. New home construction cannot ramp up quickly enough to ~~work remotely. This did not~~fill the void of the underproduction of homes for the past decade. The bottom line is that supply of homes is short and while land, labor and supply chain are limiting factors in the drive to meet current demand, we believe that the housing shortage is likely to remain for some time to come. Even though home prices have moved much higher and interest rates have ticked up slightly higher, overall affordability remains strong and interest rates are still lower than they were a year ago. Personal savings for deposits are strong and wages seem to ~~have had~~be rising faster than monthly payments. Millennials are moving out of their parents’ homes and forming families, while apartment dwellers are finding a material negative impact on our business activities. However, it did require us to increase our cybersecurity monitoring. Subject to that and through the use of appropriate risk mitigation and safety practices, we continued to strategically manage our business in this unprecedented environment in which we find ourselves. Part of our strategy included accelerating various technology initiatives to accommodate our safety first mandate and to continue our business in these difficult times.first-time home. We ~~are selling homes in person by appointment, virtually or by self-guided tours. Additionally,~~believe we are ~~implementing a virtual new home orientation process so~~uniquely positioned to capitalize and drive even greater growth in our home buyers can walk and view their completed home via FaceTime and even get keys to the front door digitally. Additionally we have increased the number of digital closings, with digital document signings and where permitted digital notarization.

~~We have worked closely with our trade partners, including through~~bottom line on this demand given our focus on ~~an even flow approach to~~orderly, targeted growth, with our sales pace tightly matched with our pace of production, which ~~enabled~~enables price appreciation to offset future cost escalations to maximize margins. We do not currently see the rising cost of homes reducing demand for the homes we build. We believe we are making up for the years of underproduction of homes now, which should keep the housing market thriving for some time to come.

The housing market is not only very strong, but it is also going through some structural changes that will promote stability in the market, and extend housing benefits to the breadth of a diverse society. The iBuyer and single-family for rent participants are providing additional liquidity to the marketplace to purchase and sell homes, as they evolve and provide ever more frictionless transactions. They are also solving important industry problems that have needed solutions for a very long time. The iBuyers, led by Opendoor, are becoming more than just a home sale option. They are an ever more effective and instrumental convenience provider, as the coordination of a new home is being complicated by supply chain disruption. Additionally, in the single-family for rent space, our ~~trade partners~~Upward America Venture facilitates a better time delivery of our homes with reduced cycle times and makes the single-family lifestyle accessible to ~~lower their costs~~more families. Professional ownership of homes enables renters to access a single-family lifestyle, while they build the resources to own, and ~~reduce their prices~~while commercial and professional owners manage the risk profile, which enables better housing for more families, and more diverse families, without weakening the mortgage market. Capitalized with $1.25 billion of equity from blue-chip institutional investors, the Upward America Venture had a pipeline of 2,534 homes with a total purchase price of $596 million at the end of the second quarter.

The combined effects of this strong housing market along with structural changes, which we are in position to ~~us. This drove~~capitalize on through our strategic investments, puts Lennar in position to continue to drive returns and should position us for consistent continued growth into fiscal 2022. We are focused on cash flow, debt reduction, and stock buyback, land controlled versus owned, return on capital, and return on equity, and on innovative technologies. In addition, we have been carefully managing a ~~year-over-year 200-basis~~stressed supply chain by maintaining our delivery targets for the year rather than increasing them. We still expect to deliver between 62,000 and 64,000 homes in 2021, but with a now higher expected gross margin of 26.5% to 27.0% and expected SG&A of 7.3% to 7.5% for the year. Our return on equity stands now at 18.8%, which is a 550 basis point improvement ~~in cost as~~over last year. Our return on capital is now 15.0%, and a percentage of revenue in the second quarter. Also in our second quarter, our cost per square foot was down 130 basis points from the prior quarter and 240 basis from the same period in the prior year. The benefit of pricing power and reduced costs will not all flow through to margins, as we are also500-basis point improvement. We have remained focused on ~~producing affordable housing. However, we do expect further margin improvement during~~our optioned versus owned land strategy, and achieved 50% land controlled through options or similar agreements two quarters earlier than expected. We ended the ~~remainder of 2020.~~

~~We also slowed our land purchases, land development activities and home starts. As a result, our land positions were temporarily altered, and we ended the~~second quarter with a ~~3.9 year~~3.3 years supply of land owned, compared to a ~~4.5 year~~3.9 years supply of land owned at the same time last year. Among other things, this has enabled us to reduce debt, such that our second quarter homebuilding debt-to-total capital ratio improved to 23.1%, from 31.2% in the ~~second quarter~~prior year.

These points of ~~2019.~~improvement have enabled us to reconsider the size of our spin-off and aim for a larger asset base in order to further fortify the new company. Accordingly, we are now targeting an asset base of $5 billion to $6 billion, which will leave the remaining pure-play homebuilding and financial services company with an appropriately liquid balance sheet and no material loss of reported earnings. The ~~portion~~new company will be an independent and active asset management business that raises third-party capital to support its ongoing business vertical. Two of these verticals, the multifamily platform and LSFR, our single-family rental platform, have already raised third-party capital and are active asset managers. Additionally, we have a dynamic and growing independent land development business, and we have a growing technology investment business, which is part of LENX. This separation of these businesses from the homebuilder will enable them to thrive in ways they cannot while they are part of Lennar.

As a company we are recasting the cost structure all the way from hard costs like labor and materials, to the softer costs around SG&A. We are re-wiring the way that this business operates, including through the technologies that we are incorporating into our business, the efficiency of our land program, our just-in-time delivery of land ~~we controlled through options or similar agreements was 32%, up from 25% last year. As home sales started to recover, we restarted our development activities. However, because of~~and the ~~mid-March through April slowdown in construction at some~~emergent inventory management component of our ~~communities,~~single-family for rent program. Additionally, as we bring debt down, we have less capital cost, and that is continuing to help our margin picture. We believe that we have never been better positioned financially, organizationally and technologically to thrive and grow in an evolving and exciting housing market. The market conditions remain strong for the foreseeable future, and we expect ~~to have fewer deliveries~~a strong second half of 2021, and continued strength in the ~~third and fourth quarters. We expect~~market as we begin to ~~deliver between 50,500 and 51,000 homes in fiscal year 2020. While community count is difficult~~look to predict, particularly in the current environment with municipal offices shutting down and being less available to provide permits for land development, we expect our community count to dip slightly in the third quarter and stabilize in the fourth quarter.2022.

Our Lennar Financial Services business continues to lead the way for the Company on innovation and enhanced customer experiences. Confronted with limitations on the ability of borrowers to engage in normal mortgage borrowing procedures, our Lennar Financial Services business accelerated its rollout of certain technologies that enabled it to have a strong second quarter in spite of those limitations. These enhancements represent a permanent improvement in our mortgage processing procedures.

In our Multifamily business, despite the disruptions to businesses and employment resulting from the COVID-19 pandemic, occupancy in the properties in which we have investments did not change substantially, and we did not encounter a significant increase in rent delinquencies. We believe the reason we were not substantially affected by people moving from urban apartments to single family homes is because people are leaving the lower quality, less-amenitized apartments, but not higher quality residential buildings such as those offered by our Multifamily business.

There are no reliable estimates of how long the pandemic will last or how many people are likely to be affected by it and therefore, the unpredictable environment in our country will evolve over time. However, we believe that we will be well positioned through hard work, focused leadership, and innovative technology.

(1) Results of Operations

Overview

We historically have experienced, and expect to continue to experience, variability in quarterly results. Our results of operations for the three and six months ended May 31, ~~2020~~2021 are not necessarily indicative of the results to be expected for the full year. Our homebuilding business is seasonal in nature and generally reflects higher levels of new home order activity in our second and third fiscal quarters and increased deliveries in the second half of our fiscal year. However, ~~periods~~a variety of ~~economic downturn in the industry~~factors can alter seasonal ~~patterns as noted in the Outlook section.~~patterns.

Our net earnings attributable to Lennar were $831.4 million, or $2.65 per diluted share ($2.66 per basic share), in the second quarter of 2021, compared to net earnings attributable to Lennar of $517.4 million, or $1.65 per diluted share ($1.66 per basic share), in the second quarter of ~~2020,~~2020. Our net earnings attributable to Lennar were $1.8 billion, or $5.85 per diluted share ($5.86 per basic share), in the six months ended May 31, 2021, compared to net earnings attributable to Lennar of ~~$421.5 million, or $1.30 per diluted share ($1.31 per basic share), in the second quarter of 2019. Our net earnings attributable to Lennar were~~ $915.9 million, or $2.91 per diluted share ($2.92 per basic share), in the six months ended May 31, ~~2020, compared to net earnings attributable to Lennar of $661.4 million, or $2.03 per diluted share ($2.05 per basic share), in the six months ended May 31, 2019.~~2020.

3828

Financial information relating to our operations was as follows:


										Three Months Ended May 31, 2021
		Three Months Ended May 31, 2020
(In thousands)	(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate	Total	(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate	Total
Revenues:	Revenues:								Revenues:
Sales of homes	Sales of homes	$	4,925,081	—	—	—	—	4,925,081	Sales of homes	$	5,980,731	—	—	—	—	5,980,731
Sales of land	Sales of land	19,833		—	—	—	—	19,833	Sales of land	38,785		—	—	—	—	38,785
Other revenues	Other revenues	4,570		196,263	123,117	18,509	—	342,459	Other revenues	8,525		218,747	177,473	5,984	—	410,729
Total revenues	Total revenues	4,949,484		196,263	123,117	18,509	—	5,287,373	Total revenues	6,028,041		218,747	177,473	5,984	—	6,430,245
Costs and expenses:	Costs and expenses:								Costs and expenses:
Costs of homes sold	Costs of homes sold	3,862,771		—	—	—	—	3,862,771	Costs of homes sold	4,421,373		—	—	—	—	4,421,373
Costs of land sold	Costs of land sold	43,369		—	—	—	—	43,369	Costs of land sold	32,979		—	—	—	—	32,979
Selling, general and administrative expenses	Selling, general and administrative expenses	407,191		—	—	—	—	407,191	Selling, general and administrative expenses	455,164		—	—	—	—	455,164
Other costs and expenses	Other costs and expenses	—		110,355	123,473	(1,072)	—	232,756	Other costs and expenses	—		97,427	168,930	5,732	—	272,089
Total costs and expenses	Total costs and expenses	4,313,331		110,355	123,473	(1,072)	—	4,546,087	Total costs and expenses	4,909,516		97,427	168,930	5,732	—	5,181,605
Equity in loss from unconsolidated entities		(9,100)		—	(282)	(26,642)	—	(36,024)
Financial Services gain on deconsolidation		—		61,418	—	—	—	61,418
Other income (expense), net		4,308		—	—	(10,960)	—	(6,652)
Equity in earnings (loss) from unconsolidated entities, Multifamily other gain and Lennar Other other income (expense), net									Equity in earnings (loss) from unconsolidated entities, Multifamily other gain and Lennar Other other income (expense), net	(1,688)		—	13,854	63,221	—	75,387
Other expense, net									Other expense, net	(4,362)		—	—	—	—	(4,362)
Lennar Other realized and unrealized gain (loss)									Lennar Other realized and unrealized gain (loss)	—		—	—	(117,570)	—	(117,570)
Operating earnings (loss)	Operating earnings (loss)	$	631,361	147,326	(638)	(18,021)	—	760,028	Operating earnings (loss)	$	1,112,475	121,320	22,397	(54,097)	—	1,202,095
Corporate general and administrative expenses	Corporate general and administrative expenses	—		—	—	—	83,451	83,451	Corporate general and administrative expenses	—		—	—	—	90,717	90,717
Charitable foundation contribution									Charitable foundation contribution	—		—	—	—	14,493	14,493
Earnings (loss) before income taxes	Earnings (loss) before income taxes	$	631,361	147,326	(638)	(18,021)	(83,451)	676,577	Earnings (loss) before income taxes	$	1,112,475	121,320	22,397	(54,097)	(105,210)	1,096,885


	Three Months Ended May 31, 2020

(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate	Total
Revenues:
Sales of homes	$	4,925,081	—	—	—	—	4,925,081
Sales of land	19,833		—	—	—	—	19,833
Other revenues	4,570		196,263	123,117	18,509	—	342,459
Total revenues	4,949,484		196,263	123,117	18,509	—	5,287,373
Costs and expenses:
Costs of homes sold	3,862,771		—	—	—	—	3,862,771
Costs of land sold	43,369		—	—	—	—	43,369
Selling, general and administrative expenses	407,191		—	—	—	—	407,191
Other costs and expenses	—		110,355	123,473	(1,072)	—	232,756
Total costs and expenses	4,313,331		110,355	123,473	(1,072)	—	4,546,087
Equity in loss from unconsolidated entities	(9,100)		—	(282)	(26,642)	—	(36,024)
Financial Services gain on deconsolidation	—		61,418	—	—	—	61,418
Other income (expense), net	4,308		—	—	(10,960)	—	(6,652)
Operating earnings	$	631,361	147,326	(638)	(18,021)	—	760,028
Corporate general and administrative expenses	—		—	—	—	78,183	78,183
Charitable foundation contribution	—		—	—	—	5,268	5,268
Earnings (loss) before income taxes	$	631,361	147,326	(638)	(18,021)	(83,451)	676,577

Three Months Ended May 31, 2019
(In thousands) Homebuilding Financial Services Multifamily Lennar Other Corporate Total
Revenues:
Sales of homes $ 5,176,116 — — — — 5,176,116
Sales of land 16,455 — — — — 16,455
Other revenues 3,028 204,216 147,412 15,663 — 370,319
Total revenues 5,195,599 204,216 147,412 15,663 — 5,562,890
Costs and expenses:
Costs of homes sold 4,137,529 — — — — 4,137,529
Costs of land sold 14,008 — — — — 14,008
Selling, general and administrative expenses 435,722 — — — — 435,722
Other costs and expenses — 147,999 148,716 3,194 — 299,909
Total costs and expenses 4,587,259 147,999 148,716 3,194 — 4,887,168
Equity in earnings (loss) from unconsolidated entities and Multifamily other gain 19,614 — (3,018) (4,978) — 11,618
Other expense, net (46,165) — — (5,663) — (51,828)
Operating earnings (loss) $ 581,789 56,217 (4,322) 1,828 — 635,512
Corporate general and administrative expenses — — — — 76,113 76,113
Earnings (loss) before income taxes $ 581,789 56,217 (4,322) 1,828 (76,113) 559,399

3929


		Six Months Ended May 31, 2020
										Six Months Ended May 31, 2021
(In thousands)	(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate	Total	(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate and unallocated	Total
Revenues:	Revenues:								Revenues:
Sales of homes	Sales of homes	$	9,065,848	—	—	—	—	9,065,848	Sales of homes	$	10,871,645	—	—	—	—	10,871,645
Sales of land	Sales of land	46,700		—	—	—	—	46,700	Sales of land	86,428		—	—	—	—	86,428
Other revenues	Other revenues	9,052		394,924	255,734	20,452	—	680,162	Other revenues	13,024		462,816	308,916	12,884	—	797,640
Total revenues	Total revenues	9,121,600		394,924	255,734	20,452	—	9,792,710	Total revenues	10,971,097		462,816	308,916	12,884	—	11,755,713
Costs and expenses:	Costs and expenses:								Costs and expenses:
Costs of homes sold	Costs of homes sold	7,154,550		—	—	—	—	7,154,550	Costs of homes sold	8,088,235		—	—	—	—	8,088,235
Costs of land sold	Costs of land sold	70,504		—	—	—	—	70,504	Costs of land sold	74,167		—	—	—	—	74,167
Selling, general and administrative expenses	Selling, general and administrative expenses	786,083		—	—	—	—	786,083	Selling, general and administrative expenses	865,400		—	—	—	—	865,400
Other costs and expenses	Other costs and expenses	—		261,699	260,821	1,502	—	524,022	Other costs and expenses	—		195,289	299,979	9,984	—	505,252
Total costs and expenses	Total costs and expenses	8,011,137		261,699	260,821	1,502	—	8,535,159	Total costs and expenses	9,027,802		195,289	299,979	9,984	—	9,533,054
Equity in earnings (loss) from unconsolidated entities and Multifamily other gain	Equity in earnings (loss) from unconsolidated entities and Multifamily other gain	(13,646)		—	6,234	(26,523)	—	(33,935)	Equity in earnings (loss) from unconsolidated entities and Multifamily other gain	(6,253)		—	12,586	62,174	—	68,507
Financial Services gain on deconsolidation		—		61,418	—	—	—	61,418
Other expense, net		(5,058)		—	—	(9,549)	—	(14,607)
Operating earnings (loss)		$	1,091,759	194,643	1,147	(17,122)	—	1,270,427
Other income, net									Other income, net	8,613		—	—	—	—	8,613
Lennar Other realized and unrealized gain (loss)									Lennar Other realized and unrealized gain (loss)	—		—	—	352,175	—	352,175
Operating earnings									Operating earnings	$	1,945,655	267,527	21,523	417,249	—	2,651,954
Corporate general and administrative expenses	Corporate general and administrative expenses	—		—	—	—	170,298	170,298	Corporate general and administrative expenses	—		—	—	—	201,248	201,248
Charitable foundation contribution									Charitable foundation contribution	—		—	—	—	26,807	26,807
Earnings (loss) before income taxes	Earnings (loss) before income taxes	$	1,091,759	194,643	1,147	(17,122)	(170,298)	1,100,129	Earnings (loss) before income taxes	$	1,945,655	267,527	21,523	417,249	(228,055)	2,423,899

Six Months Ended May 31, 2019
(In thousands) Homebuilding Financial Services Multifamily Lennar Other Corporate Total
Revenues:
Sales of homes $ 8,784,245 — — — — 8,784,245
Sales of land 30,238 — — — — 30,238
Other revenues 4,837 347,527 244,806 19,319 — 616,489
Total revenues 8,819,320 347,527 244,806 19,319 — 9,430,972
Homebuilding costs and expenses:
Costs of homes sold 7,019,579 — — — — 7,019,579
Costs of land sold 27,534 — — — — 27,534
Selling, general and administrative 778,981 — — — — 778,981
Other costs and expenses — 272,338 249,894 4,816 527,048
Total costs and expenses 7,826,094 272,338 249,894 4,816 — 8,353,142
Equity in earnings from unconsolidated entities and Multifamily other gain 5,858 — 7,563 3,352 — 16,773
Other expense, net (47,700) — — (12,924) — (60,624)
Operating earnings $ 951,384 75,189 2,475 4,931 — 1,033,979
Corporate general and administrative expenses — — — — 155,456 155,456
Earnings (loss) before income taxes $ 951,384 75,189 2,475 4,931 (155,456) 878,523


	Six Months Ended May 31, 2020
(In thousands)	Homebuilding		Financial Services	Multifamily	Lennar Other	Corporate and unallocated	Total
Revenues:
Sales of homes	$	9,065,848	—	—	—	—	9,065,848
Sales of land	46,700		—	—	—	—	46,700
Other revenues	9,052		394,924	255,734	20,452	—	680,162
Total revenues	9,121,600		394,924	255,734	20,452	—	9,792,710
Costs and expenses:
Costs of homes sold	7,154,550		—	—	—	—	7,154,550
Costs of land sold	70,504		—	—	—	—	70,504
Selling, general and administrative	786,083		—	—	—	—	786,083
Other costs and expenses	—		261,699	260,821	1,502		524,022
Total costs and expenses	8,011,137		261,699	260,821	1,502	—	8,535,159
Equity in earnings (loss) from unconsolidated entities and Multifamily other gain	(13,646)		—	6,234	(26,523)	—	(33,935)
Financial Services gain on deconsolidation	—		61,418	—	—	—	61,418
Other expense, net	(5,058)		—	—	(9,549)	—	(14,607)
Operating earnings (loss)	$	1,091,759	194,643	1,147	(17,122)	—	1,270,427
Corporate general and administrative expenses	—		—	—	—	160,817	160,817
Charitable foundation contribution	—		—	—	—	9,481	9,481
Earnings (loss) before income taxes	$	1,091,759	194,643	1,147	(17,122)	(170,298)	1,100,129

Three Months Ended May 31, ~~2020~~2021 versus Three Months Ended May 31, ~~2019~~2020

Revenues from home sales ~~decreased 5%~~increased 21% in the second quarter of ~~2020~~2021 to ~~$4.9~~$6.0 billion from ~~$5.2~~$4.9 billion in the second quarter of ~~2019.~~2020. Revenues were ~~lower~~higher primarily due to a ~~4% decrease~~14% increase in the number of home deliveries, excluding unconsolidated entities, and a 6% increase in the average sales ~~price of homes delivered.~~price. New home deliveries, excluding unconsolidated entities, increased to 14,462 homes in the second quarter of 2021 from 12,653 homes in the second quarter of ~~2020 were flat compared to 12,706 homes in the second quarter of 2019, as a result of the COVID-19 pandemic and the economic shutdown.~~2020. The average sales price of homes delivered was $414,000 in the second quarter of 2021, compared to $389,000 in the second quarter of 2020, compared to $407,000 in the second quarter of 2019. The decrease in average sales price primarily resulted from continuing to shift to lower-priced communities and regional product mix due to COVID-19 stay-at-home orders in certain higher priced markets.2020.

4030

Gross margin on home sales ~~was~~were $1.6 billion, or 26.1%, in the second quarter of 2021, compared to $1.1 billion, or 21.6%, in the second quarter of ~~2020, compared to $1.0 billion, or 20.1% in the second quarter of 2019.~~2020. The gross margin percentage on home sales increased primarily ~~due~~as a result of pricing power as the increase in revenue per square foot outpaced the increase in cost per square foot. Additionally, we continued to ~~our continued~~ focus on ~~reducing~~controlling construction costs. ~~Loss~~Gross margin on land sales in the second quarter of 2021 was $5.8 million compared to a loss of $23.5 million in the second quarter of 2020. The loss in the second quarter of 2020 was ~~$23.5 million,~~ primarily due to a write-off of costs as a result of us not moving forward with a naval base development in Concord, California, northeast of San Francisco. ~~Gross margin on land sales were $2.4 million in the second quarter of 2019.~~

Selling, general and administrative expenses were $455.2 million in the second quarter of 2021, compared to $407.2 million in the second quarter of ~~2020, compared to $435.7 million in the second quarter of 2019.~~2020. As a percentage of revenues from home sales, selling, general and administrative expenses improved to 7.6% in the second quarter of 2021, from 8.3% in the second quarter of ~~2020, from 8.4%~~2020. This was the lowest percentage for a second quarter in our history primarily due to a decrease in broker commissions and benefits of our technology efforts.

Operating earnings for the Financial Services segment were $121.2 million in the second quarter of ~~2019.~~

~~Operating earnings for our Financial Services segment were~~2021, compared to $150.6 million in the second quarter of 2020 (which included $147.3 million of operating earnings and an add back of $3.3 million of net loss attributable to noncontrolling interests) ~~compared to $62.5 million in the~~. The second quarter of ~~2019 (which~~2020 included $56.2 million of operating earnings and an add back of $6.3 million of net loss attributable to noncontrolling interests). Operating earnings increased due to an improvement in the mortgage business as a result of an increase in volume and margin, as well as reductions in loan origination costs and a $5.0 million gain on the sale of a servicing portfolio. Additionally, our Financial Services segment recorded a $61.4 million gain on the deconsolidation of a previously consolidated entity. Excluding this gain, the improvement in operating earnings was primarily due to an increase in margin in the mortgage business and an increase in volume and margin in the title business.

Operating ~~loss~~earnings for ~~our~~the Multifamily segment ~~was~~were $22.4 million in the second quarter of 2021, compared to an operating loss of $0.6 million in the second quarter of ~~2020, compared to $4.3~~2020. Operating loss for the Lennar Other segment was $54.1 million ~~($3.9 million net of noncontrolling interest)~~ in the second quarter of ~~2019. Operating loss for our Lennar Other segment was~~2021, compared to $18.0 million in the second quarter of 2020 primarily due to a $25.0 million write-down of assets held by Rialto legacy funds because of disruption in the capital markets as a result of COVID-19 and the economic shutdown. This compared to operating earnings of $1.8 million ($2.2 million net of noncontrolling interest) in2020. In the second quarter of ~~2019.~~2021, we recorded mark to market losses on our Opendoor Technologies, Inc ("Opendoor") and Sunnova Energy International Inc. ("Sunnova") investments of $234.3 million and $38.3 million, respectively. This was partially offset by a gain of $151.5 million recognized during the quarter related to the sale of our solar business to Sunnova.

Six Months Ended May 31, ~~2020~~2021 versus Six Months Ended May 31, ~~2019~~2020

Revenues from home sales increased 3%20% in the six months ended May 31, ~~2020~~2021 to ~~$9.1~~$10.9 billion from ~~$8.8~~$9.1 billion in the six months ended May 31, ~~2019.~~2020. Revenues were higher primarily due to a 7%17% increase in the number of home deliveries, excluding unconsolidated entities. ~~Despite new home deliveries in the second quarter of 2020 being consistent with the second quarter of 2019 as a result of COVID-19 and the economic shutdown, new~~New home deliveries, excluding unconsolidated entities, increased to 26,764 homes in the six months ended May 31, 2021 from 22,966 homes in the six months ended May 31, ~~2020 from 21,508 homes in the six months ended May 31, 2019, as a result of an increase in home deliveries in all of Homebuilding's segments except Other.~~2020. The average sales price of homes delivered was $406,000 in the six months ended May 31, 2021, compared to $395,000 in the six months ended May 31, ~~2020, compared to $408,000~~2020.

Gross margin on home sales were $2.8 billion, or 25.6%, in the six months ended May 31, ~~2019. The decrease in average sales price primarily resulted from continuing~~2021, compared to ~~shift to lower-priced communities and regional product mix due to COVID-19 stay-at-home orders in certain higher priced markets.~~

~~Gross margin on home sales was~~ $1.9 billion or 21.1%, in the six months ended May 31, ~~2020, compared to $1.8 billion, or 20.1% in the six months ended May 31, 2019.~~2020. The gross margin percentage on home sales increased primarily ~~due~~as a result of pricing power as the increase in revenue per square foot outpaced the increase in cost per square foot. Additionally, we continued to ~~our continued~~ focus on ~~reducing~~controlling construction costs. ~~Loss~~Gross margin on land sales in the six months ended May 31, 2021 was $12.3 million, compared to a loss of $23.8 million in the six months ended May 31, 2020. The loss in the six months ended May 31, 2020 was ~~$23.8 million,~~ primarily due to a write-off of costs in the second quarter of 2020 as a result of us not moving forward with a naval base development in Concord, California, northeast of San Francisco. ~~Gross margin on land sales~~

Selling, general and administrative expenses were ~~$2.7~~$865.4 million in the six months ended May 31, ~~2019.~~

~~Selling, general and administrative expenses were~~2021, compared to $786.1 million in the six months ended May 31, ~~2020, compared to $779.0 million in the six months ended May 31, 2019.~~2020. As a percentage of revenues from home sales, selling, general and administrative expenses improved to 8.0% in the six months ended May 31, 2021, from 8.7% in the six months ended May 31, ~~2020, from 8.9%~~2020. The improvement was primarily due to a decrease in broker commissions and benefits of our technology efforts.

Operating earnings for the Financial Services segment were $267.4 million in the six months ended May 31, ~~2019.~~

~~Operating earnings for our Financial Services segment were~~2021, compared to $208.8 million in the six months ended May 31, 2020 (which included $194.6 million ofin operating earnings and an add back of $14.1 million of net loss attributable to noncontrolling interests), compared to $84.2 million in the six months ended May 31, 2019 (which included $75.2 million of operating earnings and an add back of $9.1 million of net loss attributable to noncontrolling interests). Operating earnings increased due to an improvement in the mortgage and title businesses as a result of an increase in volume and margin, as well as reductions in loan origination costs and a $5.0 million gain on the sale of a servicing portfolio. Additionally, our Financial Services segment recordedThe six months ended May 31, 2020 included a $61.4 million gain on the deconsolidation of a previously consolidated entity. Excluding this gain, the improvement in operating earnings was primarily due to an increase in volume and margin in the mortgage and title businesses.

Operating earnings for ~~our~~the Multifamily segment were $21.5 million in the six months ended May 31, 2021, compared to operating earnings of $1.1 million in the six months ended May 31, ~~2020, compared to $2.5~~2020. Operating earnings for the Lennar Other segment were $417.2 million ~~($2.9 million net of noncontrolling interest)~~ in the six months ended May 31, ~~2019. Operating~~2021, compared to an operating loss ~~for our Lennar Other segment was~~of $17.1 million in the six months ended May 31, ~~2020 primarily due to a $25.0 million write-down of assets held by Rialto legacy funds because of disruption in the capital markets as a result of COVID-19 and the economic shutdown.~~

~~This compared to~~2020. The operating earnings ~~of $4.9 million ($5.2 million net of noncontrolling interest) in~~for the six months ended May 31, ~~2019.~~

For the six months ended May 31, 2020 and May 31, 2019, we had a tax provision of $192.8 million and $220.2 million, respectively, which resulted in an overall effective income tax rate of 17.4% and 25.0%, respectively. The reduction in the overall effective income tax rate is2021 were primarily due to the ~~extension~~net gain related to the mark to market of our shareholdings in Opendoor, which began trading on the ~~new energy efficient home tax credit during~~Nasdaq stock market in December 2020, and the ~~first quarter~~gain on the sale of ~~2020.~~our solar business to Sunnova.

Homebuilding Segments

At May 31, ~~2020,~~2021, our reportable Homebuilding segments and Homebuilding Other ~~consisted~~are outlined in Note 2 of ~~homebuilding divisions located in:~~

~~East:~~ ~~Florida, New Jersey, North Carolina, Pennsylvania and South Carolina~~

~~Central:~~ ~~Georgia, Illinois, Indiana, Maryland, Minnesota, Tennessee and Virginia~~

~~Texas:~~ ~~Texas~~

~~West:~~ ~~Arizona, California, Colorado, Nevada, Oregon, Utah and Washington~~

~~Other:~~ ~~Urban divisions and other homebuilding related investments primarily in California, including FivePoint Holdings, LLC ("FivePoint")~~

the Notes to Condensed Consolidated Financial Statements. The following tables set forth selected financial and operational information related to our homebuilding operations for the periods indicated:

Selected Financial and Operational Data

Three Months Ended May 31, 2020
Gross Margins Operating Earnings (Loss)
($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin % Net Margins on Sales of Homes (1) Gross Margins on Sales of Land Other Revenue Equity in Earnings (Loss) from Unconsolidated Entities Other Income (Expense), net Operating Earnings (Loss)
East $ 1,576,083 1,218,337 22.7 % $ 221,798 (1,093) 1,592 218 7,211 229,726
Central 684,440 561,076 18.0 % 66,269 247 638 19 (108) 67,065
Texas 694,110 530,004 23.6 % 98,566 1,524 250 1 (454) 99,887
West 1,957,435 1,533,513 21.7 % 279,509 (776) 1,914 (40) (513) 280,094
Other (2) 13,013 19,841 (52.5) % (11,023) (23,438) 176 (9,298) (1,828) (45,411)
Totals $ 4,925,081 3,862,771 21.6 % $ 655,119 (23,536) 4,570 (9,100) 4,308 631,361

Three Months Ended May 31, 2019
Gross Margins Operating Earnings (Loss)
($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin % Net Margins on Sales of Homes (1) Gross Margins on Sales of Land Other Revenue Equity in Earnings (Loss) from Unconsolidated Entities Other Income (Expense), net Operating Earnings (Loss)
East $ 1,732,216 1,374,798 20.6 % $ 208,535 1,633 1,110 (135) (679) 210,464
Central 609,195 500,071 17.9 % 54,684 171 112 69 308 55,344
Texas 687,011 547,648 20.3 % 75,055 811 201 278 (971) 75,374
West 2,140,637 1,706,645 20.3 % 270,321 (168) 425 (186) 2,512 272,904
Other (2) 7,057 8,367 (18.6) % (5,730) — 1,180 19,588 (47,335) (32,297)
Totals $ 5,176,116 4,137,529 20.1 % $ 602,865 2,447 3,028 19,614 (46,165) 581,789

Six Months Ended May 31, 2020
Gross Margins Operating Earnings (Loss)
($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin % Net Margins on Sales of Homes (1) Gross Margins on Sales of Land Other Revenue Equity in Earnings (Loss) from Unconsolidated Entities Other Income (Expense), net Operating Earnings (Loss)
East $ 2,978,755 2,303,446 22.7 % $ 403,093 (1,836) 3,275 577 (378) 404,731
Central 1,219,186 1,014,467 16.8 % 94,203 (388) 868 572 1,282 96,537
Texas 1,157,907 890,278 23.1 % 151,693 3,197 767 204 (2,901) 152,960
West 3,688,948 2,912,803 21.0 % 498,016 (1,339) 3,728 3,900 696 505,001
Other (2) 21,052 33,556 (59.4) % (21,790) (23,438) 414 (18,899) (3,757) (67,470)
Totals $ 9,065,848 7,154,550 21.1 % $ 1,125,215 (23,804) 9,052 (13,646) (5,058) 1,091,759

Six Months Ended May 31, 2019
Gross Margins Operating Earnings (Loss)
($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin % Net Margins on Sales of Homes (1) Gross Margins on Sales of Land Other Revenue Equity in Earnings (Loss) from Unconsolidated Entities Other Income (Expense), net Operating Earnings (Loss)
East $ 2,954,860 2,344,664 20.7 % $ 342,821 4,005 1,719 (234) (2,464) 345,847
Central 1,042,320 858,432 17.6 % 84,749 574 276 138 533 86,270
Texas 1,099,440 879,750 20.0 % 107,044 2,275 255 158 (2,080) 107,652
West 3,678,141 2,923,392 20.5 % 464,217 (4,149) 1,407 (497) 2,587 463,565
Other (2) 9,484 13,341 (40.7) % (13,146) (1) 1,180 6,293 (46,276) (51,950)
Totals $ 8,784,245 7,019,579 20.1 % $ 985,685 2,704 4,837 5,858 (47,700) 951,384


	Three Months Ended May 31, 2021
	Gross Margins					Operating Earnings (Loss)
($ in thousands)	Sales of Homes Revenue		Costs of Sales of Homes	Gross Margin %		Net Margins on Sales of Homes (1)	Gross Margins on Sales of Land	Other Revenue	Equity in Earnings (Loss) from Unconsolidated Entities	Other Income (Expense), net	Operating Earnings (Loss)
East	$	1,551,030	1,115,010	28.1	%	307,978	1,335	1,768	(59)	(1,195)	309,827
Central	1,093,190		846,427	22.6	%	157,429	774	579	317	(51)	159,048
Texas	790,391		551,067	30.3	%	173,803	1,837	562	387	(532)	176,057
West	2,543,263		1,893,148	25.6	%	491,223	1,860	1,311	(921)	(662)	492,811
Other (2)	2,857		15,721	(450.3)	%	(26,239)	—	4,305	(1,412)	(1,922)	(25,268)
Totals	$	5,980,731	4,421,373	26.1	%	1,104,194	5,806	8,525	(1,688)	(4,362)	1,112,475


	Three Months Ended May 31, 2020
	Gross Margins					Operating Earnings (Loss)
($ in thousands)	Sales of Homes Revenue		Costs of Sales of Homes	Gross Margin %		Net Margins on Sales of Homes (1)	Gross Margins (Loss) on Sales of Land	Other Revenue	Equity in Earnings (Loss) from Unconsolidated Entities	Other Income (Expense), net	Operating Earnings (Loss)
East	$	1,276,275	978,677	23.3	%	185,194	(1,126)	1,156	218	7,445	192,887
Central	984,248		800,736	18.6	%	102,873	280	1,074	19	(342)	103,904
Texas	694,110		530,004	23.6	%	98,566	1,524	250	1	(454)	99,887
West	1,957,435		1,533,513	21.7	%	279,509	(776)	1,914	(40)	(513)	280,094
Other (2)	13,013		19,841	(52.5)	%	(11,023)	(23,438)	176	(9,298)	(1,828)	(45,411)
Totals	$	4,925,081	3,862,771	21.6	%	655,119	(23,536)	4,570	(9,100)	4,308	631,361


	Six Months Ended May 31, 2021
	Gross Margins					Operating Earnings (Loss)
(In thousands)	Sales of Homes Revenue		Costs of Sales of Homes	Gross Margin %		Net Margins on Sales of Homes (1)	Gross Margins on Sales of Land	Other Revenue	Equity in Earnings (Loss) from Unconsolidated Entities	Other Income (Expense), net	Operating Earnings (Loss)
East	$	2,898,641	2,103,873	27.4	%	549,512	6,411	3,186	(551)	13,352	571,910
Central	2,019,628		1,559,973	22.8	%	289,528	751	984	415	(607)	291,071
Texas	1,426,801		1,002,264	29.8	%	302,964	2,871	820	541	(1,496)	305,700
West	4,520,071		3,400,875	24.8	%	809,213	2,228	2,361	41	674	814,517
Other (2)	6,504		21,250	(226.7)	%	(33,207)	—	5,673	(6,699)	(3,310)	(37,543)
Totals	$	10,871,645	8,088,235	25.6	%	1,918,010	12,261	13,024	(6,253)	8,613	1,945,655


	Six Months Ended May 31, 2020
	Gross Margins					Operating Earnings (Loss)
(In thousands)	Sales of Homes Revenue		Costs of Sales of Homes	Gross Margin %		Net Margins on Sales of Homes (1)	Gross Margins on Sales of Land	Other Revenue	Equity in Earnings (Loss) from Unconsolidated Entities	Other Income (Expense), net	Operating Earnings (Loss)
East	$	2,426,996	1,859,895	23.4	%	340,019	(1,577)	2,618	577	4	341,641
Central	1,770,945		1,458,018	17.7	%	157,277	(647)	1,525	572	900	159,627
Texas	1,157,907		890,278	23.1	%	151,693	3,197	767	204	(2,901)	152,960
West	3,688,948		2,912,803	21.0	%	498,016	(1,339)	3,728	3,900	696	505,001
Other (2)	21,052		33,556	(59.4)	%	(21,790)	(23,438)	414	(18,899)	(3,757)	(67,470)
Totals	$	9,065,848	7,154,550	21.1	%	1,125,215	(23,804)	9,052	(13,646)	(5,058)	1,091,759

(1)Net margins on sales of homes include selling, general and administrative expenses.

(2)Negative gross and net margins were due to period costs and impairments in Urban divisions that impact costs of homes sold without ~~any~~sufficient sales of homes ~~revenue. Negative gross margins on sales of land for the three and six months ended May 31, 2020 was primarily due~~revenue to ~~a write-off of costs as a result of us not moving forward with a naval base development in Concord, California.~~offset those costs.

Summary of Homebuilding Data

Deliveries:


		Three Months Ended																	Three Months Ended
		Homes				Dollar Value (In thousands)						Average Sales Price				Homes			Dollar Value (In thousands)	Average Sales Price
		May 31,				May 31,						May 31,				May 31,			May 31,	May 31,
		2020	2019	2020		2019	2020		2019		2021		2020	2021		2020	2021		2020
East	East	4,630	5,061	$	1,582,360	1,735,165	$	342,000	343,000	East	4,480		3,814	$	1,560,934	1,282,553	$	348,000	336,000
Central	Central	1,763	1,568	684,440		609,195	388,000		389,000	Central	2,761		2,579	1,093,190		984,247	396,000		382,000
Texas	Texas	2,462	2,149	694,110		687,011	282,000		320,000	Texas	2,747		2,462	790,391		694,110	288,000		282,000
West	West	3,804	3,934	1,957,435		2,140,638	515,000		544,000	West	4,502		3,804	2,543,263		1,957,435	565,000		515,000
Other	Other	13	17	13,013		17,273	1,001,000		1,016,000	Other	3		13	2,857		13,013	952,000		1,001,000
Total	Total	12,672	12,729	$	4,931,358	5,189,282	$	389,000	408,000	Total	14,493		12,672	$	5,990,635	4,931,358	$	413,000	389,000

Of the total homes delivered listed above, 31 homes with a dollar value of $9.9 million and an average sales price of $319,000 represent home deliveries from unconsolidated entities for the three months ended May 31, 2021, compared to 19 ~~homes~~home deliveries with a dollar value of $6.3 million and an average sales price of $330,000 for the three months ended May 31, 2020.


	Six Months Ended
	Homes		Dollar Value (In thousands)			Average Sales Price
	May 31,		May 31,			May 31,
	2021	2020	2021		2020	2021		2020
East	8,400	7,202	$	2,912,235	2,436,268	$	347,000	338,000
Central	5,180	4,622	2,019,628		1,770,945	390,000		383,000
Texas	5,096	4,039	1,426,802		1,157,907	280,000		287,000
West	8,124	7,108	4,520,071		3,688,948	556,000		519,000
Other	7	22	6,504		21,052	929,000		957,000
Total	26,807	22,993	$	10,885,240	9,075,120	$	406,000	395,000

Of the total homes delivered listed above, 43 homes with a dollar value of $13.6 million and an average sales price of $316,000 represent home deliveries from unconsolidated entities for the ~~three~~six months ended May 31, ~~2020,~~2021, compared to 2327 home deliveries ~~with a dollar value of $13.2 million and an average sales price of $572,000 for the three months ended May 31, 2019.~~

Six Months Ended
Homes Dollar Value (In thousands) Average Sales Price
May 31, May 31, May 31,
2020 2019 2020 2019 2020 2019
East 8,695 8,673 $ 2,988,027 2,961,600 $ 344,000 341,000
Central 3,129 2,692 1,219,186 1,042,320 390,000 387,000
Texas 4,039 3,400 1,157,907 1,099,440 287,000 323,000
West 7,108 6,759 3,688,948 3,678,141 519,000 544,000
Other 22 25 21,052 25,032 957,000 1,001,000
Total 22,993 21,549 $ 9,075,120 8,806,533 $ 395,000 409,000

~~Of the total homes delivered listed above, 27 homes~~ with a dollar value of $9.3 million and an average sales price of $343,000 ~~represent home deliveries from unconsolidated entities~~ for the six months ended May 31, ~~2020, compared to 41 home deliveries~~2020.

New Orders (1):


	Three Months Ended
	Active Communities		Homes		Dollar Value (In thousands)			Average Sales Price
	May 31,		May 31,		May 31,			May 31,
	2021	2020	2021	2020	2021		2020	2021		2020
East	351	344	5,351	4,126	$	1,987,929	1,360,519	$	372,000	330,000
Central	297	325	3,416	2,699	1,399,730		1,024,724	410,000		380,000
Texas	232	221	3,250	2,582	1,000,013		670,139	308,000		260,000
West	342	352	5,135	3,608	3,172,569		1,802,705	618,000		500,000
Other	3	3	5	—	5,146		—	1,029,000		—
Total	1,225	1,245	17,157	13,015	$	7,565,387	4,858,087	$	441,000	373,000

Of the total homes listed above, 32 homes with a dollar value of ~~$22.3~~$9.9 million and an average sales price of ~~$544,000~~$373,000 represent homes in four active communities from unconsolidated entities for the ~~six~~three months ended May 31, ~~2019.~~

~~New Orders (1):~~

Three Months Ended
Active Communities Homes Dollar Value (In thousands) Average Sales Price
At May 31, May 31, May 31, May 31,
2020 2019 2020 2019 2020 2019 2020 2019
East 423 458 4,919 5,591 $ 1,644,275 1,939,901 $ 334,000 347,000
Central 246 253 1,906 2,062 740,968 798,080 389,000 387,000
Texas 221 246 2,582 2,424 670,139 744,586 260,000 307,000
West 352 364 3,608 4,420 1,802,705 2,298,540 500,000 520,000
Other 3 4 — 21 — 15,238 — 726,000
Total 1,245 1,325 13,015 14,518 $ 4,858,087 5,796,345 $ 373,000 399,000

~~Of the total new orders listed above,~~2021, compared to 25 homes with a dollar value of $9.0 million and an average sales price of $361,000 ~~represent new orders~~ in four ~~active communities from unconsolidated entities for the three months ended May 31, 2020, compared to 32 new orders with a dollar value of $15.1 million and an average sales price of $471,000 in five~~ active communities for the three months ended May 31, ~~2019.~~

Six Months Ended
Homes Dollar Value (In thousands) Average Sales Price
May 31, May 31, May 31,
2020 2019 2020 2019 2020 2019
East 9,544 10,084 $ 3,241,573 3,461,332 $ 340,000 343,000
Central 3,679 3,484 1,436,466 1,335,676 390,000 383,000
Texas 4,581 3,848 1,243,218 1,201,545 271,000 312,000
West 7,573 7,532 3,928,337 3,928,354 519,000 522,000
Other 14 33 13,581 26,551 970,000 805,000
Total 25,391 24,981 $ 9,863,175 9,953,458 $ 388,000 398,000

Of the total new orders listed above, 51 homes with a dollar value of $17.1 million and an average sales price of $335,000 represent new orders from unconsolidated entities for the six months ended May 31, 2020, compared to 47 new orders with a dollar value of $24.8 million and an average sales price of $527,000 for the six months ended May 31, 2019.2020.

(1)~~New orders~~Homes represent the number of new sales contracts executed with homebuyers, net of cancellations, during the three and six months ended May 31, ~~2020~~2021 and May 31, ~~2019.~~2020.


	Six Months Ended
	Homes		Dollar Value (In thousands)			Average Sales Price
	May 31,		May 31,			May 31,
	2021	2020	2021		2020	2021		2020
East	10,165	7,857	$	3,688,041	2,634,872	$	363,000	335,000
Central	6,742	5,366	2,733,356		2,043,167	405,000		381,000
Texas	6,025	4,581	1,812,182		1,243,218	301,000		271,000
West	9,787	7,573	5,864,964		3,928,337	599,000		519,000
Other	8	14	8,121		13,581	1,015,000		970,000
Total	32,727	25,391	$	14,106,664	9,863,175	$	431,000	388,000

4433

~~Backlog:~~Of the total homes listed above, 67 homes with a dollar value of $23.5 million and an average sales price of $351,000 represent homes from unconsolidated entities for the six months ended May 31, 2021, compared to 51 homes with a dollar value of $17.1 million and an average sales price of $335,000 for the six months ended May 31, 2020.

Homes Dollar Value (In thousands) Average Sales Price
May 31, May 31, May 31,
2020 2019 2020 2019 2020 2019
East (1) 7,676 8,499 $ 2,702,044 3,025,598 $ 352,000 356,000
Central 2,563 2,778 1,039,118 1,083,608 405,000 390,000
Texas 2,712 2,596 798,648 862,826 294,000 332,000
West 5,023 5,174 2,547,649 2,737,664 507,000 529,000
Other 1 14 1,138 10,507 1,138,000 751,000
Total 17,975 19,061 $ 7,088,597 7,720,203 $ 394,000 405,000
Backlog:


	At
	Homes		Dollar Value (In thousands)			Average Sales Price
	May 31,		May 31,			May 31,
	2021	2020	2021		2020	2021		2020
East	7,778	6,345	$	3,086,740	2,224,974	$	397,000	351,000
Central	5,933	3,894	2,475,900		1,516,188	417,000		389,000
Texas	3,752	2,712	1,209,965		798,648	322,000		294,000
West	7,275	5,023	4,258,324		2,547,649	585,000		507,000
Other	3	1	3,465		1,138	1,155,000		1,138,000
Total	24,741	17,975	$	11,034,394	7,088,597	$	446,000	394,000

Of the total homes in backlog listed above, 62 homes with a backlog dollar value of $21.4 million and an average sales price of $345,000 represent the backlog from unconsolidated entities at May 31, 2021, compared to 55 homes with a backlog dollar value of $18.0 million and an average sales price of $327,000 ~~represent the backlog from unconsolidated entities~~ at May 31, ~~2020, compared to 13 homes with a backlog dollar value of $5.2 million and an average sales price of $397,000 at May 31, 2019.~~

~~(1)During both the three and six months ended May 31, 2019, we acquired 13 homes in backlog.~~2020.

Backlog represents the number of homes under sales contracts. Homes are sold using sales contracts, which are generally accompanied by sales deposits. In some instances, purchasers are permitted to cancel sales if they fail to qualify for financing or under certain other circumstances. Various state and federal laws and regulations may sometimes give purchasers a right to cancel homes in backlog. We do not recognize revenue on homes under sales contracts until the sales are closed and title passes to the new homeowners.

Three Months Ended May 31, ~~2020~~2021 versus Three Months Ended May 31, ~~2019~~2020

Homebuilding East: Revenues from home sales decreased in the second quarter of 2020 compared to the second quarter of 2019, primarily due to a decrease in the number of home deliveries in the Carolinas, Florida and Pennsylvania. The decrease in the number of home deliveries was primarily due to the effects of COVID-19 and the economic shutdown. The average sales price of homes delivered was consistent in the second quarter of 2020 compared to the second quarter of 2019. Gross margin percentage on home deliveries in the second quarter of 2020 improved compared to the same period last year primarily due to reducing our construction costs.

~~Homebuilding Central:~~ Revenues from home sales increased in the second quarter of ~~2020~~2021 compared to the second quarter of ~~2019,~~2020, primarily due to an increase in the number of home deliveries in all the states inof the segment except in ~~Virginia~~Pennsylvania and ~~Minnesota.~~an increase in the average sales price of homes delivered in all the states of the segment except in New Jersey. The increase in the number of home deliveries was primarily due to higher demand as the number of deliveries per active community increased. The decrease in the number of home deliveries in Pennsylvania was primarily due to a decrease in the number of communities due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered was ~~consistent~~primarily due to favorable market conditions. The decrease in the ~~second quarter~~average sales price of ~~2020 compared~~homes delivered in New Jersey was primarily driven by a change in product mix due to ~~the second quarter~~a higher percentage of ~~2019.~~deliveries in lower-priced communities. Gross margin percentage on home deliveries in the second quarter of ~~2020 improved slightly~~2021 increased compared to the same period last year primarily due to ~~reducing our construction costs.~~an increase in the revenue per square foot of homes delivered, which outpaced increases in costs per square foot.

Homebuilding Central: Revenues from home sales increased in the second quarter of 2021 compared to the second quarter of 2020, primarily due to an increase in the number of home deliveries in all the states of the segment except in Georgia, Tennessee and Virginia, and an increase in the average sales price of homes delivered in all the states of the segment. The increase in the number of home deliveries was primarily due to higher demand as the number of deliveries per active community increased. The decrease in the number of home deliveries in Georgia, Tennessee and Virginia was primarily due to a decrease in the number of communities due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered was primarily due to favorable market conditions. Gross margin percentage on home deliveries in the second quarter of 2021 increased compared to the same period last year primarily due to an increase in revenue per square foot of homes delivered, which outpaced increases in cost per square foot.

Homebuilding Texas: Revenues from home sales increased in the second quarter of ~~2020~~2021 compared to the second quarter of ~~2019,~~2020, primarily due to an increase in the number of home deliveries ~~partially offset by a decrease~~and an increase in the average sales price of homes delivered. The increase in the number of deliveries was primarily due to higher demand as the number of deliveries per active community increased. The ~~decrease~~increase in the average sales price of homes delivered was primarily due to ~~closing out higher priced communities and shifting into lower priced communities.~~favorable market conditions. Gross margin percentage on home deliveries in the second quarter of ~~2020 improved~~2021 increased compared to the same period last year primarily due to ~~reducing our construction costs.~~an increase in revenue per square foot of homes delivered, which outpaced increases in cost per square foot.

Homebuilding West: Revenues from home sales ~~decreased~~increased in the second quarter of ~~2020~~2021 compared to the second quarter of ~~2019,~~2020, primarily due to ~~a decrease~~an increase in the number of home deliveries in all the states of the segment except ~~Arizona~~in Oregon and ~~due to a decrease~~an increase in the average sales price of homes delivered in all the states of the segment except ~~Utah. The decrease~~ in ~~the number of home deliveries in all states of the segment except Arizona was primarily due to the effects of COVID-19 and the economic shutdown.~~Colorado. The increase in the number of home deliveries ~~in Arizona~~ was primarily due to higher demand as the number of deliveries per active community ~~increased.~~increased during the quarter. The decrease in the number of home deliveries in Oregon was primarily due to a decrease in the number of

deliveries per active community due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered was primarily due to favorable market conditions. The decrease in the average sales price of homes delivered in ~~all states of the segment except Utah~~Colorado was primarily driven by a change in product mix due to a higher percentage of deliveries in lower-priced communities due to COVID-19 stay-at-home orders in certain high priced markets. The increase in the average sales price of homes delivered in Utah was primarily driven by a change in product mix due to a higher percentage of deliveries in higher-priced communities. Gross margin percentage on home deliveries in the second quarter of ~~2020 improved~~2021 increased compared to the same period last year primarily due to ~~reducing our construction costs.~~

an increase in revenue per square foot of homes delivered, which outpaced increases in cost per square foot.

Six Months Ended May 31, ~~2020~~2021 versus Six Months Ended May 31, ~~2019~~2020

Homebuilding East: Revenues from home sales increased slightly in the six months ended May 31, 2020 compared to the six months ended May 31, 2019, primarily due to an increase in the number of home deliveries in Florida, partially offset by a decrease in the number of home deliveries in the Carolinas and Pennsylvania. The increase in the number of home deliveries in Florida was primarily due to higher demand as the number of deliveries per active community increased during the first quarter, partially offset by the impact of COVID-19 and economic shutdown during the second quarter. The decrease in the number of home deliveries in the Carolinas and Pennsylvania was primarily due to the impact of COVID-19 and economic shutdown during the second quarter. The average sales price of homes delivered was consistent in the six months ended May 31, 2020, compared to the same period last year. Gross margin percentage on home deliveries in the six months ended May 31, 2020 improved compared to the same period last year primarily due to reducing our construction costs.

~~Homebuilding Central:~~ Revenues from home sales increased in the six months ended May 31, ~~2020~~2021 compared to the six months ended May 31, ~~2019,~~2020, primarily due to an increase in the number of home deliveries in all the states of the segment except in Pennsylvania and an increase in the ~~segment.~~average sales price of homes delivered in all the states of the segment except in New Jersey. The increase in the number of home deliveries was primarily due to higher demand as the number of deliveries per active community increased. The decrease in the number of home deliveries in Pennsylvania was primarily due to a decrease in the number of communities due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered was primarily due to favorable market conditions. The decrease in the average sales price of homes delivered in New Jersey was primarily driven by a change in product mix due to a higher percentage of deliveries in lower-priced communities. Gross margin percentage on home deliveries in the six months ended May 31, ~~2020 decreased~~2021 increased compared to the same period last year primarily due to ~~valuation adjustments taken~~an increase in ~~a few communities during~~the revenue per square foot of homes delivered while cost per square foot were unchanged.

Homebuilding Central: Revenues from home sales increased in the six months ended May 31, ~~2020.~~2021 compared to the six months ended May 31, 2020, primarily due to an increase in the number of home deliveries in all the states of the segment except in Georgia, Maryland and Virginia, and an increase in the average sales price of homes delivered in all the states of the segment except in North Carolina and Indiana. The increase in the number of home deliveries was primarily due to higher demand as the number of deliveries per active community increased. The decrease in the number of home deliveries in Georgia, Maryland and Virginia was primarily due to a decrease in the number of communities due to the timing of opening and closing of communities. The increase in the average sales price of homes delivered was primarily due to favorable market conditions. The decrease in the average sales price of homes delivered in North Carolina and Indiana was primarily driven by a change in product mix due to a higher percentage of deliveries in lower-priced communities. Gross margin percentage on home deliveries in the six months ended May 31, 2021 increased compared to the same period last year primarily due to an increase in revenue per square foot of homes delivered.

Homebuilding Texas: Revenues from home sales increased in the six months ended May 31, ~~2020~~2021 compared to the six months ended May 31, ~~2019,~~2020, primarily due to an increase in the number of home deliveries, partially offset by a decrease in the average sales price of homes delivered. The increase in the number of deliveries was primarily due to higher demand as the number of deliveries per active community increased. The decrease in average sales price of homes delivered was primarily due to closing out higher priced communities and shifting into lower priced communities. Gross margin percentage on home deliveries in the six months ended May 31, ~~2020 improved~~2021 increased compared to the same period last year primarily due to ~~reducing our construction costs.~~an increase in revenue per square foot of homes delivered while cost per square foot were unchanged.

Homebuilding West: Revenues from home sales increased ~~slightly~~ in the six months ended May 31, ~~2020~~2021 compared to the ~~second quarter of 2019,~~six months ended May 31, 2020, primarily due to an increase in the number of home deliveries in all states of the segment ~~except Oregon, Utah~~ and ~~Washington, partially offset by a decrease~~an increase in the average sales price of homes delivered in all the states of the segment except ~~Utah.~~in Colorado. The increase in the number of home deliveries in all states of the segment ~~except Oregon, Utah and Washington~~ was primarily due to higher demand as the number of deliveries per active community increased during the ~~first quarter, partially offset by the impact of COVID-19 and economic shutdown during the second~~ quarter. The decrease in the number of home deliveries in Oregon, Utah and Washington was primarily due to the impact of COVID-19 and economic shutdown during the second quarter. The decrease in the average sales price of homes delivered in all states of the segment except Utah was primarily driven by a change in product mix due to a higher percentage of deliveries in lower-priced communities due to COVID-19 stay-at-home orders in certain higher priced markets. The increase in the average sales price of homes delivered ~~in Utah~~ was primarily ~~driven by a change in product mix~~ due to afavorable market conditions. The decrease in average sales price of homes delivered in Colorado was primarily due to closing out higher ~~percentage of deliveries in higher-priced~~priced communities and shifting into lower priced communities. Gross margin percentage on home deliveries in the six months ended May 31, ~~2020 improved~~2021 increased compared to the same period last year primarily due to ~~reducing our construction costs.~~an increase in revenue per square foot of homes delivered, which outpaced increases in cost per square foot.

Financial Services Segment

Our Financial Services reportable segment provides mortgage financing, title and closing services primarily for buyers of our homes. The segment also originates and sells into securitizations commercial mortgage loans through its LMF Commercial business. Our Financial Services segment sells substantially all of the residential loans it originates within a short period in the secondary mortgage market, the majority of which are sold on a servicing released, non-recourse basis. After the loans are sold, we retain potential liability for possible claims by purchasers that we breached certain limited industry-standard representations and warranties in the loan sale agreements.

The following table sets forth selected financial and operational information related to the residential mortgage and title activities of our Financial Services segment:

Three Months Ended Six Months Ended
May 31, May 31,
(Dollars in thousands) 2020 2019 2020 2019
Dollar value of mortgages originated $ 3,258,000 2,620,000 $ 5,478,000 4,557,000
Number of mortgages originated 10,100 8,250 17,000 14,500
Mortgage capture rate of Lennar homebuyers 82 % 75 % 79 % 74 %
Number of title and closing service transactions 14,400 13,500 25,500 28,100


	Three Months Ended					Six Months Ended
	May 31,					May 31,
(Dollars in thousands)	2021			2020		2021		2020





Dollar value of mortgages originated	$	3,186,000		3,258,000		5,947,000		5,478,000
Number of mortgages originated	9,500			10,100		17,900		17,000
Mortgage capture rate of Lennar homebuyers	74		%	82	%	75	%	79	%
Number of title and closing service transactions	17,100			14,400		32,100		25,500

At May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, the carrying value of Financial Services' commercial mortgage-backed securities ("CMBS") was ~~$164.9~~$162.9 million and ~~$166.0~~$164.2 million, respectively. These securities were purchased at discounts ranging from 6% to 84% with coupon rates ranging from 2.0% to 5.3%, stated and assumed final distribution dates between October 2027 and December 2028, and stated maturity dates between October 2050 and December 2051. Our Financial Services segment classifiesDetails of these securities ~~as held-to-maturity based on its intent~~ and ~~ability~~related debt are within Note 2 of the Notes to ~~hold the securities until maturity.~~

~~LMF Commercial~~

~~LMF Commercial originates and sells into securitizations five, seven and ten year commercial first mortgage loans, which are secured by income producing properties.~~

During the six months ended May 31, 2020, LMF Commercial originated commercial loans with a total principal balance of $417.7 million, all of which were recorded as loans held-for-sale and sold $457.4 million of commercial loans into three separate securitizations. As of May 31, 2020, there were $146.4 million of originated commercial loans were sold into a securitization trust but not settled and thus were included as receivables, net.

During the six months ended May 31, 2019, LMF Commercial originated commercial loans with a total principal balance of $720.6 million, of which $705.3 million were recorded as loans held-for-sale, and sold $500.5 million of loans into five separate securitizations.Condensed Consolidated Financial Statements.

Multifamily Segment

We have been actively involved, primarily through unconsolidated entities, in the development, construction and property management of multifamily rental properties. Our Multifamily segment focuses on developing a geographically diversified portfolio of institutional quality multifamily rental properties in select U.S. markets.

Originally, our Multifamily segment focused on building multifamily properties and selling them shortly after they were completed. However, more recently we have focused on creating and participating in ventures that build multifamily properties with the intention of retaining them after they are completed.

The following tables provide information related to our investment in the Multifamily segment:

Balance Sheets

May 31, 2020

November 30, 2019

Balance Sheets

(Dollars in thousands)

(In thousands)

May 31, 2021

November 30, 2020

Multifamily investments in unconsolidated entities

621,465

561,190

Multifamily investments in unconsolidated entities

691,330

724,647

Lennar's net investment in Multifamily

888,218

829,537

Lennar's net investment in Multifamily

936,941

906,632


Statements of Operations	Statements of Operations	Three Months Ended				Six Months Ended					Statements of Operations	Three Months Ended		Six Months Ended
								May 31,				May 31,
(Dollars in thousands)	(Dollars in thousands)	May 31, 2020		May 31, 2019	May 31, 2020	May 31, 2019	(Dollars in thousands)	2021		2020		2021	2020

Number of operating properties/investments sold through joint ventures	Number of operating properties/investments sold through joint ventures	—		—	2	2	Number of operating properties/investments sold through joint ventures	1		—		1	2
Lennar's share of gains on the sale of operating properties/investments	Lennar's share of gains on the sale of operating properties/investments	$	—	—	3,000	15,500	Lennar's share of gains on the sale of operating properties/investments	$	14,784	—		14,784	3,000

~~Despite widespread reductions~~Lennar Other Segment

At May 31, 2021 and November 30, 2020, we had $1.1 billion and $521.7 million, respectively, of assets in ~~economic activity~~our Lennar Other segment, which included investments in unconsolidated entities of $379.2 million and $387.1 million, respectively. The increase in assets during the six months ended May 31, 2021 was due to an increase in the ~~COVID-19 pandemic,~~value of our strategic technology investments, primarily managed by our LENX subsidiary. This increase was largely related to our strategic investments in Opendoor and Sunnova. During the ~~properties~~three months ended May 31, 2021, we completed the sale of our residential solar business to Sunnova for shares in ~~which~~ the ~~Multifamily segment has investments did not, overall, experience significant increases in vacancies or in delinquent rent payments to date.~~entity. The following is a detail of Lennar Other realized and unrealized gain (loss):


	Three Months Ended			Six Months Ended
	May 31,			May 31,
(In thousands)	2021		2020	2021	2020


Opendoor (OPEN) mark to market	$	(234,290)	—	235,455	—
Sunnova (NOVA) mark to market	(38,335)		—	(38,335)	—
Gain on sale of solar business	151,475		—	151,475	—
Other realized gain	3,580		—	3,580	—
	$	(117,570)	—	352,175	—

4736

(2) Financial Condition and Capital Resources

At May 31, ~~2020,~~2021, we had cash and cash equivalents and restricted cash related to our homebuilding, financial services, multifamily and other operations of ~~$1.7~~$2.8 billion, compared to ~~$1.5~~$2.9 billion at November 30, ~~2019~~2020 and ~~$1.0~~$1.7 billion at May 31, ~~2019.~~2020.

We finance all of our activities, including homebuilding, financial services, multifamily, other and general operating needs, primarily with cash generated from our operations, debt issuances and cash borrowed under our warehouse lines of credit and our unsecured revolving credit facility (the "Credit Facility").

Operating Cash Flow Activities

During the six months ended May 31, ~~2020~~2021 and May 31, ~~2019,~~2020, cash provided by ~~(used in)~~ operating activities totaled $718.1 million and $1.3 billion, respectively. During the six months ended May 31, 2021, cash provided by operating activities was impacted primarily by our net earnings, a decrease in loans held-for-sale of $444.4 million primarily related to the sale of loans originated by our Financial Services segment, an increase in accounts payable and ~~($429.9)~~other liabilities of $184.7 million, ~~respectively.~~ and a decrease in receivables of $117.9 million, partially offset by an increase in inventories due to strategic land purchases, and land development and construction costs of $1.6 billion.

During the six months ended May 31, 2020, cash provided by operating activities was impacted primarily by our net earnings and a decrease in loans held-for-sale of ~~$481.6~~$479.4 million primarily related to the sale of loans originated by our Financial Services segment, partially offset by an increase in inventories due to strategic land purchases, land development and construction costs of $159.1 million and an increase in other assets of $148.1 ~~million.~~

During the six months ended May 31, 2019, cash used in operating activities was impacted primarily by an increase in inventories due to strategic land purchases, land development and construction costs of $1.5 billion, an increase in loans held-for-sale of $206.3 million and a decrease in accounts payable and other liabilities of $192.5 million. This was partially offset by our net earnings, a decrease in receivables of $542.1 million primarily related to a decrease in Financial Services' receivables, net, which are loans sold to investors for which we have not been paid, deferred income tax expense of $101.5 million and a decrease in other assets of $66.5 million.

Investing Cash Flow Activities

During the six months ended May 31, ~~2020~~2021 and May 31, ~~2019,~~2020, cash used in investing activities totaled $50.1 million and $174.0 million, respectively. During the six months ended May 31, 2021, our cash used in investing activities was primarily due to cash contributions of $282.2 million to unconsolidated entities, which included (1) $178.6 million to Homebuilding unconsolidated entities, (2) $57.8 million to Multifamily unconsolidated entities, and ~~$91.6~~(3) $45.8 million ~~respectively.~~ to the strategic technology investments included in the Lennar Other segment. This was partially offset by distributions of capital from unconsolidated entities of $231.5 million, which primarily included (1) $134.2 million from Homebuilding unconsolidated entities, (2) $80.1 million from Multifamily unconsolidated entities, and (3) $17.2 million from the unconsolidated Rialto real estate funds included in our Lennar Other segment.

During the six months ended May 31, 2020, our cash used in investing activities was primarily due to $302.8 million of investments in and contributions to unconsolidated entities and deconsolidation of a previously consolidated entity, which included (1) $31.2 million to Homebuilding unconsolidated entities; (2) $79.7 million to Multifamily unconsolidated entities; (3) $39.3 million in strategic technology investments included in our Lennar Other segment; and (4) derecognition of $152.5 million of cash as of the date of deconsolidation of a previously consolidated Financial Services entity. This was partially offset by distributions of capital from unconsolidated entities of $115.1 million, which primarily included (1) $33.4 million from Multifamily unconsolidated entities, (2) $36.4 million from the unconsolidated Rialto real estate funds included in our Lennar Other segment and (3) $45.3 million from Homebuilding unconsolidated entities.

During the six months ended May 31, 2019, our cash used in investing activities was primarily due to cash contributions of $230.7 million to unconsolidated entities, which included (1) $136.3 million to Homebuilding unconsolidated entities, (2) $60.0 million to Multifamily unconsolidated entities primarily for working capital; and (3) $31.8 million to the unconsolidated Rialto real estate funds and strategic investments included in our Lennar Other segment. This was partially offset by distributions of capital from unconsolidated entities of $140.9 million, which included (1) $52.4 million from Multifamily unconsolidated entities; (2) $46.5 million from Homebuilding unconsolidated entities; (3) $29.3 million from the unconsolidated Rialto real estate funds and strategic technology investments included in our Lennar Other segment; and (4) $12.7 million from Financial Services unconsolidated entities.

Financing Cash Flow Activities

During the six months ended May 31, ~~2020~~2021 and May 31, ~~2019,~~2020, cash used in financing activities totaled $817.8 million and $948.6 million, respectively. During the six months ended May 31, 2021, cash used in financing activities was primarily impacted by (1) $535.7 million of net repayments under our Financial Services' warehouse facilities, which included the LMF Commercial warehouse repurchase facilities; (2) $156.3 million of dividend payments; and ~~$53.4~~(3) repurchases of our common stock for $173.6 million, ~~respectively.~~ which included $141.6 million of repurchases under our repurchase program and $32.1 million of repurchases related to our equity compensation plan. These were partially offset by $301.9 million of proceeds from liabilities related to consolidated inventory not owned due to land sales to land banks.

During the six months ended May 31, 2020, cash used in financing activities was primarily impacted by (1) $310.2 million of net repayments under our Financial Services' warehouse facilities, which included the LMF Commercial warehouse repurchase facilities; (2) the redemption of $300.0 million aggregate principal amount of our 6.625% senior notes due May 2020; (3) repurchases of our common stock, which included $288.5 million of repurchases under our repurchase program and $7.5 million of repurchases related to our equity compensation plan; and (4) $174.4 million of principal payments on notes payable and other borrowings. These were partially offset by $169.1 million of receipts related to noncontrolling interests.

During the six months ended May 31, 2019, cash used in financing activities was primarily impacted by $365.2 million of net repayments under our Financial Services' warehouse facilities, which included the RMF warehouse repurchase facilities, $123.7 million principal payment on other borrowings and repurchases of our common stock of $101.2 million, which included $98.8 million of repurchases of our stock under our repurchase program and $2.5 million of repurchases related to equity

4837

~~compensation plans, partially offset by $550.0 million of net borrowings under our Credit Facility and $28.6 million proceeds from other borrowings.~~

Debt to total capital ratios are financial measures commonly used in the homebuilding industry and are presented to assist in understanding the leverage of our homebuilding operations. Homebuilding debt to total capital and net Homebuilding debt to total capital are calculated as follows:

(Dollars in thousands) May 31,
2020 November 30,
2019 May 31,
2019
Homebuilding debt $ 7,495,674 7,776,638 9,390,941
Stockholders’ equity 16,542,703 15,949,517 15,159,304
Total capital $ 24,038,377 23,726,155 24,550,245
Homebuilding debt to total capital 31.2 % 32.8 % 38.3 %
Homebuilding debt $ 7,495,674 7,776,638 9,390,941
Less: Homebuilding cash and cash equivalents 1,398,682 1,200,832 800,678
Net Homebuilding debt $ 6,096,992 6,575,806 8,590,263
Net Homebuilding debt to total capital (1) 26.9 % 29.2 % 36.2 %


(Dollars in thousands)	May 31, 2021			November 30, 2020		May 31, 2020
Homebuilding debt	$	5,894,342		5,955,758		7,495,674
Stockholders’ equity	19,576,108			17,994,856		16,542,703
Total capital	$	25,470,450		23,950,614		24,038,377
Homebuilding debt to total capital	23.1		%	24.9	%	31.2	%
Homebuilding debt	$	5,894,342		5,955,758		7,495,674
Less: Homebuilding cash and cash equivalents	2,581,583			2,703,986		1,398,682
Net Homebuilding debt	$	3,312,759		3,251,772		6,096,992
Net Homebuilding debt to total capital (1)	14.5		%	15.3	%	26.9	%

(1)Net homebuilding debt to total capital is a non-GAAP financial measure defined as net homebuilding debt (homebuilding debt less homebuilding cash and cash equivalents) divided by total capital (net homebuilding debt plus stockholders' equity). We believe the ratio of net homebuilding debt to total capital is a relevant and a useful financial measure to investors in understanding the leverage employed in homebuilding operations. However, because net homebuilding debt to total capital is not calculated in accordance with GAAP, this financial measure should not be considered in isolation or as an alternative to financial measures prescribed by GAAP. Rather, this non-GAAP financial measure should be used to supplement our GAAP results.

At May 31, ~~2020,~~2021, Homebuilding debt to total capital ~~improved~~was lower compared to May 31, ~~2019 and November 30, 2019,~~2020, primarily as a result of a decrease in Homebuilding debt and an increase in stockholders' equity due to net earnings. At May 31, 2021, Homebuilding debt to total capital was lower compared to November 30, 2020, primarily as a result of an increase in stockholders' equity due to net earnings.

We are continually exploring various types of transactions to manage our leverage and liquidity positions, take advantage of market opportunities and increase our revenues and earnings. These transactions may include the issuance of additional indebtedness, the repurchase of our outstanding indebtedness, the repurchase of our common stock, the acquisition of homebuilders and other companies, the purchase or sale of assets or lines of business, the issuance of common stock or securities convertible into shares of common stock, and/or the pursuit of other financing alternatives. In connection with some of our non-homebuilding businesses, we are also considering other types of transactions such as sales, restructurings, joint ventures, spin-offs or initial public offerings as we continue to move back towards being a pure play homebuilding company.

Our Homebuilding senior notes and other debts payable as well as letters of credit and surety bonds are summarized within Note 7 of the Notes to ~~the~~ Condensed Consolidated Financial Statements. Our Homebuilding average debt outstanding and the average rates of interest was as follows:


	Six Months Ended
	May 31,
(Dollars in thousands)	2021			2020
Homebuilding average debt outstanding	$	5,981,490		$	8,171,686
Average interest rate	4.9		%	4.9		%
Interest incurred	$	142,517		$	184,198

As of May 31, ~~2020, we had an unsecured revolving credit facility (the "Credit Facility") with~~2021, the maximum borrowings ~~of $2.45~~on our Credit Facility were $2.5 billion ~~with~~ and included a $300 million accordion feature, subject to additional commitments, thus the maximum borrowings could be $2.8 billionmaturing in 2024. The Credit Facility agreement (the "Credit Agreement") provides that up to $500 million in commitments may be used for letters of ~~credit.~~credit. Under the Credit Agreement, ~~as of the end of the fiscal quarter,~~ we are subject to debt covenants. The maturity, details and debt covenants of the Credit Facility are unchanged from the disclosure in ~~our~~the Financial Condition and Capital Resources section ~~in its~~of our Form 10-K for the year ended November 30, ~~2019. In addition to the Credit Facility, we have other letter of credit facilities with different financial institutions.~~

~~Our letter of credit and surety bond facilities are described below:~~

Currently, substantially all of our 100% owned homebuilding subsidiaries are guaranteeing all our senior notes (the "Guaranteed Notes"). The guarantees are full and unconditional. However, they will terminate as to a subsidiary any time it is not directly or indirectly guaranteeing at least $75 million of Lennar Corporation debt or when the subsidiary is sold. These guarantees are outlined in Note 13 of the Notes to the Condensed Consolidated Financial Statements.

~~Our Homebuilding average debt outstanding with an average rate of interest was as follows:~~

Six Months Ended
(Dollars in thousands) May 31,
2020 May 31,
2019
Homebuilding average debt outstanding $ 8,171,686 $ 9,218,102
Average interest rate 4.9 % 4.9 %
Interest incurred 184,198 212,559

Under the amended Credit Facility agreement executed in April 2019 (the "Credit Agreement"), as of the end of each fiscal quarter, we are required to maintain minimum consolidated tangible net worth of approximately $7.1 billion plus the sum of 50% of the cumulative consolidated net income for each completed fiscal quarter subsequent to February 28, 2019, if positive, and 50% of the net cash proceeds from any equity offerings from and after February 28, 2019, minus the lesser of 50% of the amount paid after April 11, 2019 to repurchase common stock and $375.0 million. We are required to maintain a leverage ratio that shall not exceed 65% and may be reduced by 2.5% per quarter if our interest coverage ratio is less than 2.25:1.00 for two consecutive fiscal calendar quarters. The leverage ratio will have a floor of 60%. If our interest coverage ratio subsequently exceeds 2.25:1.00 for two consecutive fiscal calendar quarters, the leverage ratio we will be required to maintain will be increased by 2.5% per quarter to a maximum of 65%. As of the end of each fiscal quarter, we are also required to maintain either (1) liquidity in an amount equal to or greater than 1.00x consolidated interest incurred for the last twelve months then ended or (2) an interest coverage ratio equal to or greater than 1.50:1.00 for the last twelve months then ended. We believe that we were in compliance with our debt covenants at May 31, 2020.

The following summarizes our debt covenant requirements and our actual levels or ratios with respect to those covenants as calculated per the Credit Agreement as of May 31, ~~2020:~~2021:


(Dollars in thousands)	Covenant Level			Level Achieved as of May 31, 2021
Minimum net worth test	$	9,290,371		13,075,167
Maximum leverage ratio	65.0		%	18.8	%
Liquidity test	1.00			9.09

(Dollars in thousands) Covenant Level Level Achieved as of May 31, 2020
Minimum net worth test $ 7,928,483 11,090,017
Maximum leverage ratio 65.0 % 33.0 %
Liquidity test 1.00 3.81

~~At May 31, 2020, the~~ Financial Services ~~warehouse facilities were all 364-day repurchase facilities and used to fund residential mortgages or commercial mortgages for LMF Commercial as follows:~~


~~(In thousands)~~	~~Maximum Aggregate Commitment~~
~~Residential facilities maturing:~~
~~June 2020 (1)~~	$	~~500,000~~
~~July 2020~~	~~300,000~~
~~January 2021~~	~~500,000~~
~~March 2021~~	~~300,000~~
~~Total - Residential facilities~~	$	~~1,600,000~~
~~LMF Commercial facilities maturing:~~
~~November 2020~~	$	~~200,000~~
~~December 2020 (2)~~	~~700,000~~



~~Total - LMF Commercial facilities~~	$	~~900,000~~
~~Total~~	$	~~2,500,000~~

~~(1)Subsequent to May 31, 2020, the maturity date was extended to June 2021.~~

~~(2)~~Includes $50.0 million LMF Commercial warehouse repurchase facility used to finance the origination of floating rate accrual loans, which are reported as accrual loans within loans held-for-investment, net. There were borrowings under this facility of $11.4 million as of May 31, 2020.Warehouse Facilities

Our Financial Services segment uses the residential facilities to finance its residential lending activities until the mortgage loans are sold to investors and the proceeds are collected. The facilities are non-recourse to us and are expected to be renewed or replaced with other facilities when they mature. The LMF Commercial facilities finance LMF Commercial loan ~~originations~~origination and securitization activities and were secured by ~~a 75%~~up to an 80% interest in the originated commercial loans financed.

~~Borrowings~~ These facilities and the related borrowings and collateral ~~under~~are detailed in Note 2 of the ~~facilities and their prior year predecessors were as follows:~~

(In thousands) May 31, 2020 November 30, 2019
Borrowings under the residential facilities $ 1,054,588 $ 1,374,063
Collateral under the residential facilities 1,085,503 1,423,650
Borrowings under the LMF Commercial facilities 227,003 216,870

~~If the facilities are not renewed or replaced, the borrowings under the lines of credit will be repaid by selling the mortgage loans held-for-sale~~Notes to ~~investors and by collecting receivables on loans sold but not yet paid for. Without the facilities, the~~Condensed Consolidated Financial ~~Services segment would have to use cash from operations and other funding sources to finance its lending activities.~~Statements.

Changes in Capital Structure

In January ~~2019,~~2021, our Board of Directors authorized the repurchase of up to the lesser of $1.0 billion in value, or 25 million in shares, of our outstanding Class A and Class B common stock. The repurchase authorization replaced a January 2019 authorization and has no expiration date. The ~~following table describes the repurchase~~details of our Class A and Class B common ~~stocks,~~stock under this program for both the three and six months ended May 31, 2021 and 2020 are included in Note 4 of the Notes to Condensed Consolidated Financial Statements.

During the six months ended May 31, 2021, treasury stock increased due to our repurchase of 1.9 million shares of Class A and ~~2019:~~

Class B common stock due primarily to our repurchase of 1.5 million shares of Class A and Class B common stock through our stock repurchase program. During the six months ended May 31, 2020, treasury stock increased due to our repurchase of 4.4 million shares of Class A and Class B common stock through our stock repurchase program. During the six months ended May 31, 2019, treasury stock increased by 2.1 million shares of Class A common stock due primarily to our repurchase of 2.0 million shares of Class A common stock through our stock repurchase program.

On June ~~25, 2020,~~18, 2021, our Board of Directors declared a quarterly cash dividend of ~~$0.125~~$0.25 per share on both our Class A and Class B common stock, payable on July ~~24, 2020~~19, 2021 to holders of record at the close of business on July ~~10, 2020.~~2, 2021. On May 5, ~~2020,~~2021, we paid cash dividends of ~~$0.125~~$0.25 per share on both our Class A and Class B common stock to holders of record at the close of business on April 21, ~~2020,~~2021, as declared by our Board of Directors on April 7, ~~2020.~~2021. We ~~declared~~approved and paid cash dividends of ~~$0.04~~$0.125 per share for each of the first three quarters of 2020 and $0.25 per share in fourth quarter of 2020 on both our Class A and Class B common stock ~~in each~~and first two quarter ~~for the year ended November 30, 2019.~~of 2021 on both its Class A and Class B common stock.

Based on our current financial condition and credit relationships, we believe that ~~assuming the effects of the COVID-19 pandemic and resulting governmental actions on our operations do not significantly worsen for a protracted period,~~ our operations and borrowing resources will provide for our current and long-term capital requirements at our anticipated levels of activity.

Supplemental Financial Information

Currently, substantially all of our 100% owned homebuilding subsidiaries are guaranteeing all our senior notes. The guarantees are full and unconditional.

The indentures governing our senior notes require that, if any of our 100% owned subsidiaries, other than our finance company subsidiaries and foreign subsidiaries, directly or indirectly guarantee at least $75 million principal amount of debt of Lennar Corporation (other than senior notes), those subsidiaries must also guarantee Lennar Corporation’s obligations with regard to its senior notes. Included in the following tables as part of “Obligors” together with Lennar Corporation are subsidiary entities that are not finance company subsidiaries or foreign subsidiaries and were guaranteeing the senior notes because at May 31, 2021 they were guaranteeing Lennar Corporation's letter of credit facilities and its Credit Facility, disclosed in Note 7 of the Notes to Condensed Consolidated Financial Statements. The guarantees are full, unconditional and joint and several and the guarantor subsidiaries are 100% directly or indirectly owned by Lennar Corporation. A subsidiary's guarantee of Lennar senior notes will be suspended at any time when it is not directly or indirectly guaranteeing at least $75 million principal amount of debt of Lennar Corporation (other than senior notes), and a subsidiary will be released from its guarantee and any other obligations it may have regarding the senior notes if all or substantially all its assets, or all of its capital stock, are sold or otherwise disposed.

Supplemental information for the Obligors, which excludes non-guarantor subsidiaries and intercompany transactions, at May 31, 2021 is included in the following tables. Intercompany balances and transactions within the Obligors have been eliminated and amounts attributable to the Obligor’s investment in consolidated subsidiaries that have not issued or guaranteed the senior notes have been excluded. Amounts due from and transactions with nonobligor subsidiaries and related parties are separately disclosed:


(In thousands)	May 31, 2021		November 30, 2020
Due from non-guarantor subsidiaries	$	3,501,212	2,655,503
Equity method investments	1,008,979		951,579
Total assets	29,645,023		27,695,067
Total liabilities	9,824,021		9,599,718


	Six Months Ended
(In thousands)	May 31, 2021
Total revenues	$	11,065,793
Operating earnings	2,009,860
Earnings before income taxes	1,784,336
Net earnings attributable to Lennar	1,363,838

Off-Balance Sheet Arrangements

Homebuilding: Investments in Unconsolidated Entities

AtAs of May 31, ~~2020,~~2021, we had equity investments in 4942 active homebuilding and land unconsolidated entities (of which three had recourse debt, 1013 had non-recourse debt and 3626 had no debt) compared to 5038 active homebuilding and land unconsolidated entities at November 30, ~~2019.~~2020. Historically, we have invested in unconsolidated entities that acquired and developed land (1) for our homebuilding operations or for sale to third parties or (2) for the construction of homes for sale to third-party homebuyers. Through these entities, we have primarily sought to reduce and share our risk by limiting the amount of our capital invested in land, while obtaining access to potential future homesites and allowing us to participate in strategic ventures. The use of these entities also, in some instances, has enabled us to acquire land to which we could not otherwise obtain access, or could not obtain access on as favorable terms, without the participation of a strategic partner. Participants in these joint ventures have been land owners/developers, other homebuilders and financial or strategic partners. Joint ventures with land owners/developers have given us access to homesites owned or controlled by our partners. Joint ventures with other homebuilders have provided us with the ability to bid jointly with our partners for large land parcels. Joint ventures with financial partners have allowed us to combine our homebuilding expertise with access to our partners’ capital. Joint ventures with strategic partners have allowed us to combine our homebuilding expertise with the specific expertise (e.g. commercial or infill experience) of our partners. Each joint venture is governed by an executive committee consisting of members from the partners.

~~As of May 31, 2020 and November 30, 2019, our recorded~~ Details regarding these investments, in Homebuilding unconsolidated entities were $973.0 million and $1.0 billion, respectively, while the underlying equity related to our investments in Homebuilding unconsolidated entities partners’ net assets as of both May 31, 2020 and November 30, 2019 were $1.3 billion. The basis

difference is primarily as a result of us contributing our investment in three strategic joint ventures with a higher fair value than book value for an investment in the FivePoint entity and deferring equity in earnings on land sales to us. Included in our recorded investments in Homebuilding unconsolidated entities is our 40% ownership of FivePoint. As of May 31, 2020 and November 30, 2019, the carrying amount of our investment in FivePoint was $376.9 million and $374.0 million, respectively.

~~The Homebuilding unconsolidated entities in which we have investments usually finance their activities with a combination of partner equity~~balances and debt ~~financing. In some instances, we and our partners have guaranteed debt of unconsolidated entities.~~

Indebtedness of an unconsolidated entity is secured by its own assets. Some unconsolidated entities own multiple properties and other assets. There is no cross collateralization of debt of different unconsolidated entities. We also do not use our investmentare included in ~~one unconsolidated entity as collateral for the debt of another unconsolidated entity or commingle funds among Homebuilding unconsolidated entities.~~

In connection with loans to a Homebuilding unconsolidated entity, we and our partners often guarantee to a lender, either jointly and severally or on a several basis, any or all of the following: (i) the completion of the development, in whole or in part, (ii) indemnification of the lender against losses from environmental issues, (iii) indemnification of the lender from "bad boy acts" of the unconsolidated entity (or full recourse liability in the event of an unauthorized transfer or bankruptcy) and (iv) that the loan to value and/or loan to cost will not exceed a certain percentage (maintenance or remargining guarantee) or that a percentage of the outstanding loan will be repaid (repayment guarantee).

The total debt of the Homebuilding unconsolidated entities in which we have investments was $1.1 billion as of both May 31, 2020 and November 30, 2019, of which our maximum recourse exposure was $4.9 million and $10.8 million as of May 31, 2020 and November 30, 2019, respectively. In most instances in which we have guaranteed debt of a Homebuilding unconsolidated entity, our partners have also guaranteed that debt and are required to contribute their share of the guarantee payment. In a repayment guarantee, we and our venture partners guarantee repayment of a portion or all of the debt in the event of a default before the lender would have to exercise its rights against the collateral.

In connection with many of the loans to Homebuilding unconsolidated entities, we and our joint venture partners (or entities related to them) have been required to give guarantees of completion to the lenders. Those completion guarantees may require that the guarantors complete the construction of the improvements for which the financing was obtained. If the construction is to be done in phases, the guarantee generally is limited to completing only the phases as to which construction has already commenced and for which loan proceeds were used. If we are required to make a payment under any guarantee, the payment would generally constitute a capital contribution or loan to the Homebuilding unconsolidated entity and increase our share of any funds the unconsolidated entity distributes.

As of May 31, 2020 and November 30, 2019, the fair values of the repayment, maintenance, and completion guarantees were not material. We believe that as of May 31, 2020, in the event we become legally obligated to perform under a guarantee of the obligation of a Homebuilding unconsolidated entity due to a triggering event under a guarantee, the collateral would be sufficient to repay at least a significant portion of the obligation or we and our partners would contribute additional capital into the venture. In certain instances, we have placed performance letters of credit and surety bonds with municipalities with regard to obligations of our joint ventures (see Note 73 of the Notes to Condensed Consolidated Financial ~~Statements).~~Statements.

The following table summarizes the principal maturities of our Homebuilding unconsolidated entities ("JVs") debt as per current debt arrangements as of May 31, ~~2020~~2021 and it does not represent estimates of future cash payments that will be made to reduce debt balances. Many JV loans have extension options in the loan agreements that would allow the loans to be extended into future years.

Principal Maturities of Unconsolidated JVs by Period
(In thousands) Total JV Debt 2020 2021 2022 Thereafter Other
Maximum recourse debt exposure to Lennar $ 4,932 — — 4,932 — —
Debt without recourse to Lennar 1,116,812 49,412 262,858 150,224 654,318 —
Land seller and CDD debt 9,045 — — — — 9,045
Debt issuance costs (12,415) — — — — (12,415)
Total $ 1,118,374 49,412 262,858 155,156 654,318 (3,370)


	Principal Maturities of Unconsolidated JVs by Period
(In thousands)	Total JV Debt		2021	2022	2023	Thereafter	Other



Debt without recourse to Lennar	$	1,204,527	97,054	224,668	19,255	863,550	—
Land seller and CDD and other debt	11,208		—	—	—	—	11,208
Maximum recourse debt exposure to Lennar	3,599		—	3,599	—	—	—
Debt issuance costs	(13,118)		—	—	—	—	(13,118)
Total	$	1,206,216	97,054	228,267	19,255	863,550	(1,910)

Multifamily: Investments in Unconsolidated Entities

At May 31, ~~2020,~~2021, Multifamily had equity investments in 2116 unconsolidated entities that are engaged in multifamily residential developments (of which 710 had non-recourse debt and 14six had no debt), compared to 1922 unconsolidated entities at November 30, ~~2019.~~2020. We invest in unconsolidated entities that acquire and develop land to construct multifamily rental

properties. Through these entities, we are focusing on developing a geographically diversified portfolio of institutional quality multifamily rental properties in select U.S. markets. Initially, we participated in building multifamily developments and selling them soon after they were completed. Recently, however, we have been focused on developing properties with the intention of retaining them. Participants in these joint ventures have been financial partners. Joint ventures with financial partners have allowed us to combine our development and construction expertise with access to our partners’ capital. Each joint venture is governed by an operating agreement that provides significant substantive participating voting rights on major decisions to our partners.

The Multifamily segment includes LMV I and LMV II, which are long-term multifamily development investment vehicles involved in the development, construction and property management of class-A multifamily assets. Details of each as of and during the six months ended May 31, ~~2020~~2021 are included ~~below:~~

May 31, 2020
(In thousands) LMV I LMV II
Lennar's carrying value of investments $ 355,136 213,635
Equity commitments 2,204,016 1,257,700
Equity commitments called 2,127,560 754,177
Lennar's equity commitments 504,016 381,000
Lennar's equity commitments called 493,730 227,372
Lennar's remaining commitments 10,286 153,628
Distributions to Lennar during the six months ended May 31, 2020 19,969 —
in Note 3 of the Notes to Condensed Consolidated Financial Statements.

We regularly monitor the results of both our Homebuilding and Multifamily unconsolidated joint ventures and any trends that may affect their future liquidity or results of operations. We also monitor the performance of joint ventures in which we have investments on a regular basis to assess compliance with debt covenants. For those joint ventures not in compliance with

the debt covenants, we evaluate and assess possible impairment of our investment. We believe all of the joint ventures were in compliance with ~~their~~applicable debt covenants at May 31, ~~2020.~~2021.

The following table summarizes the principal maturities of our Multifamily unconsolidated entities debt as per current debt arrangements as of May 31, ~~2020~~2021 and it does not represent estimates of future cash payments that will be made to reduce debt balances.


		Principal Maturities of Unconsolidated JVs by Period														Principal Maturities of Unconsolidated JVs by Period
(In thousands)	(In thousands)	Total JV Debt		2020	2021	2022	Thereafter	Other	(In thousands)	Total JV Debt		2021	2022	2023	Thereafter	Other

Debt without recourse to Lennar	Debt without recourse to Lennar	$	2,345,974	88,790	653,144	453,455	1,150,585	—	Debt without recourse to Lennar	$	2,865,860	288,422	529,886	758,597	1,288,955	—
Debt issuance costs	Debt issuance costs	(31,789)		—	—	—	—	(31,789)	Debt issuance costs	(26,220)		—	—	—	—	(26,220)
Total	Total	$	2,314,185	88,790	653,144	453,455	1,150,585	(31,789)	Total	$	2,839,640	288,422	529,886	758,597	1,288,955	(26,220)

Lennar Other: Investments in Unconsolidated Entities

As part of the sale of the Rialto investment and asset management platform, we retained our ability to receive a portion of payments with regard to carried interests if funds meet specified performance thresholds. We periodically receive advance distributions related to the carried interests in order to cover income tax obligations resulting from allocations of taxable income to the carried interests. These distributions are not subject to clawbacks but will reduce future carried interest payments to which we become entitled from the applicable funds and have been recorded as revenues.

As of May 31, ~~2020~~2021 and November 30, ~~2019,~~2020, we had strategic technology investments in ~~strategic technology~~ unconsolidated entities of ~~$189.5~~$178.2 million and ~~$124.3~~$196.7 million, respectively.

Option Contracts

We often obtain access to land through option contracts, which generally enable us to control portions of properties owned by third parties (including land funds) and unconsolidated entities until we have determined whether to exercise the options.

The table below indicates the number of homesites owned and homesites to which we had access through option contracts with third parties ("optioned") or unconsolidated JVs (i.e., controlled homesites) ~~at May 31, 2020 and May 31, 2019:~~

Controlled Homesites Years of
May 31, 2020 Optioned JVs Total Owned Homesites Total Homesites Supply Owned (1)
East 28,763 13,608 42,371 77,370 119,741
Central 7,320 122 7,442 29,765 37,207
Texas 23,164 — 23,164 36,179 59,343
West 12,355 2,900 15,255 59,777 75,032
Other — 8,681 8,681 2,071 10,752
Total homesites 71,602 25,311 96,913 205,162 302,075 3.9
% of total homesites 32 % 68 %

Controlled Homesites Years of
May 31, 2019 Optioned JVs Total Owned Homesites Total Homesites Supply Owned (1)
East 26,688 3,482 30,170 79,313 109,483
Central 6,627 132 6,759 32,559 39,318
Texas 23,119 — 23,119 35,987 59,106
West 8,066 4,493 12,559 63,757 76,316
Other — 919 919 3,610 4,529
Total homesites 64,500 9,026 73,526 215,226 288,752 4.5
% of total homesites 25 % 75 %
:


	Controlled Homesites							Years of
May 31, 2021	Optioned	JVs	Total		Owned Homesites		Total Homesites	Supply Owned (1)
East	55,537	5,750	61,287		55,218		116,505
Central	24,283	92	24,375		41,816		66,191
Texas	43,447	—	43,447		38,332		81,779
West	52,347	3,444	55,791		51,336		107,127
Other	4	7,569	7,573		2,235		9,808
Total homesites	175,618	16,855	192,473		188,937		381,410	3.3
% of total homesites			50	%	50	%


	Controlled Homesites							Years of
May 31, 2020	Optioned	JVs	Total		Owned Homesites		Total Homesites	Supply Owned (1)
East	22,812	13,608	36,420		63,932		100,352
Central	13,271	122	13,393		43,203		56,596
Texas	23,164	—	23,164		36,179		59,343
West	12,355	2,900	15,255		59,777		75,032
Other	—	8,681	8,681		2,071		10,752
Total homesites	71,602	25,311	96,913		205,162		302,075	3.9
% of total homesites			32	%	68	%

(1)Based on trailing twelve months of home deliveries.

~~We evaluate certain~~Details on option contracts ~~for land to determine whether they are VIEs~~ and if so, whether we are the primary beneficiary of certain of these option contracts. Although we do not have legal title to the optioned land, if we are deemed to be the primary beneficiary or make a significant deposit for optioned land, we may need to consolidate the land under option at the purchase price of the optioned land. Consolidated land purchase options are reflected in the accompanying condensed consolidated balance sheets as consolidated inventory not owned. Over the next several years, we plan to increase the controlled homesites to 50% of our entire homesite inventory from approximately 32% as of May 31, 2020. Recently, we have undertaken several strategic land initiatives which include acquiring fully developed homesites from regional developers and may also include building homes in bulk for landowners who will retain them as rental properties.

~~During the six months ended May 31, 2020,~~related consolidated inventory not owned ~~increased by $86.7 million with a corresponding increase to liabilities related to consolidated inventory not owned~~and exposure are included in the accompanying condensed consolidated balance sheet as of May 31, 2020. The increase was primarily due to the consolidation of option contracts, partially offset by us exercising our options to acquire land under previously consolidated contracts. To reflect the purchase priceNote 10 of the ~~inventory that was consolidated, we had a net reclass related~~Notes to option deposits from consolidated inventory not owned to land under development in the accompanying condensed consolidated balance sheet as of May 31, 2020. The liabilities related to consolidated inventory not owned primarily represent the difference between the option exercise prices for the optioned land and our cash deposits.

Our exposure to losses related to option contracts with third parties and unconsolidated entities consisted of non-refundable option deposits and pre-acquisition costs totaling $282.1 million and $320.5 million at May 31, 2020 and November 30, 2019, respectively. Additionally, we had posted $72.5 million and $75.0 million of letters of credit in lieu of cash deposits under certain land and option contracts as of May 31, 2020 and November 30, 2019, respectively.Condensed Consolidated Financial Statements.

Contractual Obligations and Commercial Commitments

Our contractual obligations and commercial commitments have not changed materially from those reported in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended November 30, ~~2019.~~2020. There ~~was~~were no outstanding borrowings under our Credit Facility as of May 31, ~~2020.~~2021.

(3) New Accounting Pronouncements

See Note 121 of the Notes to Condensed Consolidated Financial Statements included under Item 1 of this Report for a discussion of new accounting pronouncements applicable to our company.

(4) Critical Accounting Policies

We believe that there have been no significant changes to our critical accounting policies during the six months ended May 31, ~~2020~~2021 as compared to those we disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K, for the year ended November 30, ~~2019.~~2020.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risks related to fluctuations in interest rates on our investments, debt obligations, loans held-for-sale and loans held-for-investment. We utilize forward commitments and option contracts to mitigate the risks associated with our mortgage loan portfolio.

As of May 31, ~~2020,~~2021, we had no outstanding borrowings under our Credit Facility.

As of May 31, ~~2020,~~2021, our borrowings under Financial Services' warehouse repurchase facilities totaled ~~$1.1 billion~~$671.5 million under residential facilities and ~~$227~~$104.2 million under LMF Commercial facilities.

Information Regarding Interest Rate Sensitivity

Principal (Notional) Amount by

Expected Maturity and Average Interest Rate

May 31, ~~2020~~2021

~~Six Months Ending November 30,~~

~~Years Ending November 30,~~

~~Fair Value at May 31,~~

~~(Dollars in millions)~~

~~2020~~

~~2021~~

~~2022~~

~~2023~~

~~2024~~

~~2025~~

~~Thereafter~~

~~Total~~

~~2020~~

~~LIABILITIES:~~

~~Homebuilding:~~

~~Senior notes and other debts payable:~~

~~Fixed rate~~

~~537.8~~

~~1,156.2~~

~~1,795.7~~

~~73.2~~

~~1,522.7~~

~~572.1~~

~~1,679.3~~

~~7,337.0~~

~~7,896.4~~

~~Average interest rate~~

~~2.7~~

~~5.7~~

~~4.8~~

~~3.6~~

~~5.0~~

~~4.8~~

~~4.9~~

—

~~Variable rate~~

~~38.6~~

~~71.5~~

~~1.5~~

~~7.2~~

~~0.9~~

~~4.2~~

~~124.8~~

~~131.8~~

~~Average interest rate~~

~~3.0~~

~~6.7~~

~~3.9~~

~~4.1~~

~~3.3~~

~~5.2~~

—

~~Financial Services:~~

~~Notes and other debts payable:~~

~~Fixed rate~~

—

~~153.9~~

~~155.4~~

~~Average interest rate~~

—

~~3.4~~

—

~~Variable rate~~

~~1,282.0~~

—

~~1,282.0~~

~~Average interest rate~~

~~2.4~~

—

~~2.4~~

—

~~Lennar Other:~~

~~Notes and other debts payable:~~

~~Fixed rate~~

~~1.9~~

—

~~1.9~~

~~Average interest rate~~

~~3.0~~

—

~~3.0~~

—

~~Variable rate~~

~~4.3~~

—

~~4.3~~

~~Average interest rate~~

~~3.1~~

—

~~3.1~~

—


	Six Months Ending November 30,			Years Ending November 30,														Fair Value at May 31,
(Dollars in millions)	2021			2022		2023		2024		2025		2026		Thereafter		Total		2021
LIABILITIES:
Homebuilding:
Senior Notes and other debts payable:
Fixed rate	$	355.2		1,539.7		99.0		1,557.2		591.8		402.9		1,297.5		5,843.3		6,381.0
Average interest rate	5.6		%	4.5	%	4.2	%	5.0	%	4.8	%	5.2	%	4.7	%	4.8	%	—
Variable rate	$	33.0		—		—		—		—		—		—		33.0		33.3
Average interest rate	4.6		%	—		—		—		—		—		—		4.6	%	—
Financial Services:
Notes and other debts payable:
Fixed rate	$	—		—		—		—		—		—		152.4		152.4		153.3
Average interest rate	—			—		—		—		—		—		3.4	%	3.4	%	—
Variable rate	$	775.8		—		—		—		—		—		—		775.8		775.8
Average interest rate	2.4		%	—		—		—		—		—		—		2.4	%	—




Lennar Other:
Notes and other debts payable:
Fixed rate	$	1.9		—		—		—		—		—		—		1.9		1.9
Average interest rate	3.0		%	—		—		—		—		—		—		3.0	%	—

For additional information regarding our market risk refer to Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our Annual Report on Form 10-K for the year ended November 30, ~~2019.~~2020.

Item 4. Controls and Procedures

~~Our Chief~~Each of our Co-Chief Executive ~~Officer~~Officers and Co-Presidents ("Co-CEOs") and Chief Financial Officer participated in an evaluation by our management of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on their participation in that evaluation, our ~~CEO~~Co-CEOs and CFO concluded that our disclosure controls and procedures were effective as of May 31, ~~2020~~2021 to ensure that information required to be disclosed in our reports filed or

submitted under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and to ensure that information required to be disclosed in our reports filed or furnished under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to our management, including both of our ~~CEO~~Co-CEOs and CFO, as appropriate, to allow timely decisions regarding required disclosures.

~~Our CEO~~Both of our Co-CEOs and CFO also participated in an evaluation by our management of any changes in our internal control over financial reporting that occurred during the quarter ended May 31, ~~2020.~~2021. That evaluation did not identify any changes that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II. Other Information

Item 1. Legal Proceedings

We are a party to various claims ~~legal actions~~ and ~~complaints arising~~lawsuits which arise in the ordinary course of ~~business. In~~business, but we do not consider the ~~opinion~~volume of ~~management,~~our claims and lawsuits unusual given the ~~disposition~~number of homes we deliver and the fact that the lawsuits often relate to homes delivered several years before the lawsuits are commenced. Although the specific allegations in the lawsuits differ, they most commonly involve claims that we failed to construct homes in particular communities in accordance with plans and specifications or applicable construction codes and seek reimbursement for sums allegedly needed to remedy the alleged deficiencies, assert contract issues or relate to personal injuries. Lawsuits of these types are common within the homebuilding industry. We are a plaintiff in a number of cases in which we seek contribution from our subcontractors for home repair costs. The costs incurred by us in construction defect lawsuits may be offset by warranty reserves, our third-party insurers, subcontractor insurers or indemnity contributions from subcontractors. From time to time, we are also a party to lawsuits involving purchases and sales of real property. These lawsuits often include claims regarding representations and warranties made in connection with the transfer of the property and disputes regarding the obligation to purchase or sell the property. From time-to-time, we also receive notices from environmental agencies or other regulators regarding alleged violations of environmental or other laws. We typically settle these matters before they reach litigation for amounts that are not material to us.

We do not believe that the ultimate resolution of these claims or lawsuits will ~~not~~ have a material adverse effect on our ~~condensed consolidated~~business or financial ~~statements.~~position.

Item 1A. Risk Factors

~~Our results of operations and financial condition may be adversely affected by the COVID-19 pandemic and resulting governmental actions.~~

~~Demand for our homes is dependent on a variety of macroeconomic factors, such as employment levels, interest rates,~~There have been no material changes in ~~stock market valuations, consumer confidence, housing demand, availability of financing~~our risk factors from those disclosed in our Annual Report on Form 10-K for home buyers, availability and prices of new homes compared to existing inventory, and demographic trends. These factors, in particular consumer confidence, can be significantly adversely affected by a variety of factors beyond our control. The COVID-19 pandemic has caused the shutdown of large portions of our national economy. While portions of the national economy have begun to reopen, there is still significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. economy and consumer confidence. The extent to which COVID-19 impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19, whether there are additional outbreaks of COVID-19, and the actions taken to contain it or treat its impact. If the virus continues to cause significant negative impacts to economic conditions or consumer confidence, our results of operations, financial condition and cash flows could be materially adversely impacted.year ended November 30, 2020.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information about our repurchases of common stock during the three months ended May 31, ~~2020:~~2021:

Period: Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number of Shares that may yet be Purchased under the Plans or Programs (2)
March 1 to March 31, 2020 — $ — — 10,860,271
April 1 to April 30, 2020 2,801 $ 37.55 — 10,860,271
May 1 to May 31, 2020 — $ — — 10,860,271


Period:	Total Number of Shares Purchased (1)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2)	Maximum Number of Shares that may yet be Purchased under the Plans or Programs (2)
March 1 to March 31, 2021	67,370	$	82.60	—	24,490,000
April 1 to April 30, 2021	—	$	—	—	24,490,000
May 1 to May 31, 2021	1,001,313	$	98.45	1,000,000	23,490,000

(1)Includes shares of Class A common stock withheld by us to cover withholding taxes due, at the election of certain holders of nonvested shares, with market value approximating the amount of withholding taxes due.

(2)In January ~~2019,~~2021, our Board of Directors authorized a stock repurchase program, which replaced ~~the June 2001~~a January 2019 stock repurchase program, under which we are authorized to purchase up to the lesser of $1.0 billion in value, excluding commission, or 25 million in shares, of our outstanding Class A or Class B common stock. This repurchase authorization has no expiration.

Items 3 - 5. Not Applicable

5744

Item 6. Exhibits


10.1***			2021 Award Agreements under the Company’s 2016 Incentive Compensation Plan for Mr. Miller, Mr. Beckwitt, Mr. Jaffe, Ms. Bessette, Mr. McCall and Mr. Sustana - Incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, dated February 26, 2021.
10.2***			Form of 2021 Award Agreement under the Company’s 2016 Equity Incentive Plan for Mr. Miller, Mr. Beckwitt, Mr. Jaffe, Ms. Bessette and Mr. McCall - Incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, dated February 26, 2021.
31.1*			Rule 13a-14(a) certification by Rick ~~Beckwitt, Chief Executive Officer.~~Beckwitt.
31.2*			Rule 13a-14(a) certification by Jonathan M. Jaffe.
31.3*			Rule 13a-14(a) certification by Diane ~~Bessette, Vice President, Chief Financial Officer and Treasurer.~~Bessette.
32.*			Section 1350 certifications by Rick Beckwitt, ~~Chief Executive Officer,~~Jonathan M. Jaffe, and Diane ~~Bessette, Vice President, Chief Financial Officer and Treasurer.~~Bessette.
101.*			The following financial statements from Lennar Corporation's Quarterly Report on Form 10-Q for the quarter ended May 31, ~~2020,~~2021, filed on July ~~6, 2020,~~2, 2021, were formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Condensed Consolidated Statements of Cash Flows and (iv) the Notes to Condensed Consolidated Financial Statements.
101.INS*			iXBRL Instance Document.
101.SCH*			iXBRL Taxonomy Extension Schema Document.
101.CAL*			iXBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*			iXBRL Taxonomy Extension Definition.
101.LAB*			iXBRL Taxonomy Extension Label Linkbase Document.
101.PRE*			iXBRL Taxonomy Presentation Linkbase Document.
104**			The cover page from Lennar Corporation's Quarterly Report on Form 10-Q for the quarter ended May 31, ~~2020~~2021 was formatted in iXBRL.

* Filed herewith.

** Included in Exhibit 101.

*** Management contract or compensatory plan or arrangement.

5845

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		Lennar Corporation
		(Registrant)

Date:	July ~~6, 2020~~2, 2021	/s/ Diane Bessette
		Diane Bessette
		Vice President, Chief Financial Officer and Treasurer

Date:	July ~~6, 2020~~2, 2021	/s/ David Collins
		David Collins
		Vice President and Controller


(In thousands)	Fair Value Hierarchy	Fair Value at May 31, 2020		Fair Value at November 30, 2019
Financial Services Assets:
Residential loans held-for-sale (1)	Level 2	$	1,003,470	1,447,715
LMF Commercial loans held-for-sale (2)	Level 3	$	159,886	197,224



Mortgage servicing rights	Level 3	$	1,238	24,679
Lennar Other:
Investments available-for-sale	Level 3	$	53,585	—


(In thousands)	Lennar Corporation		Guarantor Subsidiaries	Non-Guarantor Subsidiaries	Consolidating Adjustments	Total
ASSETS
Homebuilding:
Cash and cash equivalents, restricted cash and receivables, net	$	1,000,333	695,182	12,230	—	1,707,745
Inventories	—		17,528,852	418,554	—	17,947,406
Investments in unconsolidated entities	—		971,058	1,986	—	973,044
Goodwill	—		3,442,359	—	—	3,442,359
Other assets	392,355		468,610	251,743	(32,522)	1,080,186
Investments in subsidiaries	10,270,732		21,757	—	(10,292,489)	—
Intercompany	12,267,017		—	—	(12,267,017)	—
	23,930,437		23,127,818	684,513	(22,592,028)	25,150,740
Financial Services	—		249,999	2,329,154	(1,348)	2,577,805
Multifamily	—		—	1,127,929	—	1,127,929
Lennar Other	—		187,352	281,789	(16,590)	452,551
Total assets	$	23,930,437	23,565,169	4,423,385	(22,609,966)	29,309,025
LIABILITIES AND EQUITY
Homebuilding:
Accounts payable and other liabilities	$	832,049	1,821,132	331,807	(50,460)	2,934,528
Liabilities related to consolidated inventory not owned	—		344,074	—	—	344,074
Senior notes and other debts payable	6,555,685		865,539	74,450	—	7,495,674
Intercompany	—		10,145,745	2,121,272	(12,267,017)	—
	7,387,734		13,176,490	2,527,529	(12,317,477)	10,774,276
Financial Services	—		30,344	1,633,204	—	1,663,548
Multifamily	—		—	222,387	—	222,387
Lennar Other	—		—	16,190	—	16,190
Total liabilities	7,387,734		13,206,834	4,399,310	(12,317,477)	12,676,401
Total stockholders’ equity	16,542,703		10,358,335	(65,846)	(10,292,489)	16,542,703
Noncontrolling interests	—		—	89,921		89,921
Total equity	16,542,703		10,358,335	24,075	(10,292,489)	16,632,624
Total liabilities and equity	$	23,930,437	23,565,169	4,423,385	(22,609,966)	29,309,025


(Dollars in thousands)	Covenant Level			Level Achieved as of May 31, 2020
Minimum net worth test	$	7,928,483		11,090,017
Maximum leverage ratio	65.0		%	33.0	%
Liquidity test	1.00			3.81