Rialto Investments Segment (Tables)

6 Months Ended

May 31, 2012

Segment Reporting Information [Line Items]

Assets And Liabilities Related To Rialto Segment

The assets and liabilities related to the Rialto segment were as follows:

(In thousands)	May 31, 2012		November 30, 2011
Assets:
Cash and cash equivalents	$	92,959	83,938
Defeasance cash to retire notes payable	138,665		219,386
Loans receivable, net	578,375		713,354
Real estate owned - held-for-sale	113,115		143,677
Real estate owned - held-and-used, net	634,401		582,111
Investments in unconsolidated entities	150,733		124,712
Investments held-to-maturity	14,538		14,096
Other	26,041		15,874
	$	1,748,827	1,897,148
Liabilities:
Notes payable	$	594,915	765,541
Other	17,683		30,579
	$	612,598	796,120

Operating Earnings Related To Rialto Segment

Rialto’s operating earnings were as follows:

	Three Months Ended					Six Months Ended
	May 31,					May 31,
(In thousands)	2012			2011		2012		2011
Revenues	$	33,472		42,595		65,680		76,218
Costs and expenses	30,198			32,273		63,568		60,622
Rialto Investments equity in earnings (loss) from unconsolidated entities	5,569			(2,973	)	24,027		1,552
Rialto Investments other income (expense), net	(1,372		)	15,329		(13,612	)	28,532
Operating earnings (1)	$	7,471		22,678		12,527		45,680

(1) Operating earnings for the three and six months ended May 31, 2012 include net earnings (loss) attributable to noncontrolling interests of $3.2 million and ($1.2) million, respectively. Operating earnings for the three and six months ended May 31, 2011 include net earnings (loss) attributable to noncontrolling interests of $12.9 million and $24.8 million, respectively.

Loans Receivable By Aggregate Collateral Type

The following table displays the loans receivable by aggregate collateral type:

(In thousands)	May 31, 2012		November 30, 2011
Land	$	304,239	348,234
Single family homes	126,656		152,265
Commercial properties	114,218		172,799
Multi-family homes	24,395		28,108
Other	8,867		11,948
Loans receivable	$	578,375	713,354

Outstanding Balance And Carrying Value Of Loans

The outstanding balance and carrying value of loans accounted for under ASC 310-30 was as follows:

(In thousands)	May 31, 2012		November 30, 2011
Outstanding principal balance	$	1,040,569	1,331,094
Carrying value	$	517,967	639,642

Accretable Yield For The FDIC Portfolios And Bank Portfolios

The activity in the accretable yield for the FDIC Portfolios and Bank Portfolios during the six months ended May 31, 2012 and 2011were as follows:

(In thousands)	May 31, 2012			May 31, 2011
Accretable yield, beginning of period	$	209,480		396,311
Additions	8,423			16,173
Deletions	(23,256		)	(37,869	)
Accretions	(40,890		)	(61,114	)
Accretable yield, end of period	$	153,757		313,501

Nonaccrual Loans

The following tables represent nonaccrual loans in the FDIC Portfolios and Bank Portfolios accounted for under ASC 310-10 aggregated by collateral type:

May 31, 2012

			Recorded Investment
(In thousands)	Unpaid Principal Balance		With Allowance	Without Allowance	Total  Recorded Investment
Land	$	40,590	—	16,694	16,694
Single family homes	28,458		1,156	14,410	15,566
Commercial properties	35,996		—	22,818	22,818
Multi-family homes	10,928		—	5,145	5,145
Other	295		—	185	185
Loans receivable	$	116,267	1,156	59,252	60,408

November 30, 2011

			Recorded Investment
(In thousands)	Unpaid Principal  Balance		With Allowance	Without Allowance	Total  Recorded Investment
Land	$	75,557	—	24,692	24,692
Single family homes	55,377		1,956	13,235	15,191
Commercial properties	48,293		2,660	24,434	27,094
Multi-family homes	16,750		—	6,735	6,735
Other	405		—	—	—
Loans receivable	$	196,382	4,616	69,096	73,712

Risk Indicators

Accrual and nonaccrual loans receivable by risk categories were as follows:

May 31, 2012

(In thousands)	Accrual		Nonaccrual	Total
Land	$	287,545	16,694	304,239
Single family homes	111,090		15,566	126,656
Commercial properties	91,400		22,818	114,218
Multi-family homes	19,250		5,145	24,395
Other	8,682		185	8,867
Loans receivable	$	517,967	60,408	578,375

November 30, 2011

(In thousands)	Accrual		Nonaccrual	Total
Land	$	323,542	24,692	348,234
Single family homes	137,074		15,191	152,265
Commercial properties	145,705		27,094	172,799
Multi-family homes	21,373		6,735	28,108
Other	11,948		—	11,948
Loans receivable	$	639,642	73,712	713,354

Changes In Real Estate Owned

The following tables present the activity in REO: 

	Three Months Ended					Six Months Ended
	May 31,					May 31,
(In thousands)	2012			2011		2012		2011
REO - held-for-sale, beginning of period	$	101,579		431,119		143,677		250,286
Additions	221			94,568		1,355		280,209
Improvements	2,036			5,516		5,999		8,234
Sales	(45,210		)	(13,028	)	(82,054	)	(20,554	)
Impairments	(382		)	—		(1,622	)	—
Transfers to Lennar Homebuilding	(3,904		)	(3,926	)	(3,904	)	(3,926	)
Transfers to/from held-and-used, net (1)	58,775			—		49,664		—
REO - held-for-sale, end of period	$	113,115		514,249		113,115		514,249

	Three Months Ended					Six Months Ended
	May 31,					May 31,
(In thousands)	2012			2011		2012		2011
REO - held-and-used, net, beginning of period	$	630,570		15,126		582,111		7,818
Additions	63,434			1,391		109,675		8,734
Improvements	780			—		780		—
Sales	—			—		(981	)	—
Impairments	(676		)	—		(3,273	)	—
Depreciation	(932		)	(50	)	(4,247	)	(85	)
Transfers to/from held-for-sale (1)	(58,775		)	—		(49,664	)	—
REO - held-and-used, net, end of period	$	634,401		16,467		634,401		16,467

(1) During the three and six months ended May 31, 2012, the Rialto segment transferred certain properties to/from REO held-and-used, net to/from REO held-for-sale as a result of changes in the disposition strategy of the real estate assets.

Condensed Financial Information By Equity Method Investment, Balance Sheets

Balance Sheets

(In thousands)	May 31, 2012		November 30, 2011
Assets:
Cash and cash equivalents	$	137,104	60,936
Loans receivable	400,467		274,213
Real estate owned	107,363		47,204
Investment securities	4,081,846		4,336,418
Other assets	223,861		171,196
	$	4,950,641	4,889,967
Liabilities and equity:
Accounts payable and other liabilities	$	166,557	320,353
Notes payable	230,561		40,877
Partner loans	163,516		137,820
Debt due to the U.S. Treasury	1,492,950		2,044,950
Equity	2,897,057		2,345,967
	$	4,950,641	4,889,967

Condensed Financial Information By Equity Method Investment, Statements Of Operations

Statements of Operations

	Three Months Ended				Six Months Ended
	May 31,				May 31,
(In thousands)	2012			2011	2012		2011
Revenues	$	70,869		83,251	153,513		150,314
Costs and expenses	94,288			63,894	177,710		152,474
Other income	—			—	—		123,007
Net earnings (loss) of unconsolidated entities	$	(23,419	)	19,357	(24,197	)	120,847
Lennar Homebuilding equity in earnings (loss) from unconsolidated entities (1)	$	(9,381	)	2,417	(8,298	)	11,078

(1) For both the three and six months ended May 31, 2012, Lennar Homebuilding equity in earnings (loss) includes $5.4 million of valuation adjustments related to strategic asset sales at Lennar Homebuilding's unconsolidated entities. For the six months ended May 31, 2011, Lennar Homebuilding equity in earnings (loss) included a $15.4 million gain related to the Company’s share of a $123.0 million gain on debt extinguishment at a Lennar Homebuilding unconsolidated entity, partially offset by $4.5 million of valuation adjustments related to assets of Lennar Homebuilding’s unconsolidated entities.

Statements of Operations

	Three Months Ended				Six Months Ended
	May 31,				May 31,
(In thousands)	2012		2011		2012	2011
Revenues	$	119,123	116,044		241,528	232,932
Costs and expenses	51,996		35,045		103,181	86,516
Other income (expense), net (1)	37,335		(165,918	)	303,775	(79,130	)
Net earnings (loss) of unconsolidated entities	$	104,462	(84,919	)	442,122	67,286
Rialto Investments equity in earnings (loss) from unconsolidated entities	$	5,569	(2,973	)	24,027	1,552

(1) Other income (expense), net for the three and six months ended May 31, 2012 and 2011 includes the AB PPIP Fund’s mark-to-market unrealized gains and unrealized losses, of which the Company’s portion is a small percentage.