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Rialto Segment (Tables)
 6 Months Ended
May 31, 2016
Segment Reporting [Abstract]  
Schedule of Assets and Liabilities Financial information relating to the Company’s operations was as follows:
(In thousands)
May 31,
2016
 
November 30,
2015
Assets:
 
 
 
Homebuilding East
$
3,614,986

 
3,140,604

Homebuilding Central
1,529,601

 
1,421,195

Homebuilding West
4,445,575

 
4,157,616

Homebuilding Houston
525,167

 
481,386

Homebuilding Other
841,342

 
858,000

Rialto
1,171,987

 
1,505,500

Lennar Financial Services
1,423,679

 
1,425,837

Lennar Multifamily
518,089

 
415,352

Corporate and unallocated
777,375

 
1,014,019

Total assets
$
14,847,801

 
14,419,509


 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
Revenues:
 
 
 
 
 
 
 
Homebuilding East
$
954,298

 
838,235

 
1,613,352

 
1,448,918

Homebuilding Central
419,311

 
302,509

 
694,530

 
513,017

Homebuilding West
718,059

 
627,361

 
1,269,398

 
1,010,134

Homebuilding Houston
189,676

 
189,647

 
328,297

 
320,904

Homebuilding Other
169,541

 
158,060

 
331,789

 
264,497

Lennar Financial Services
175,940

 
169,885

 
299,896

 
294,712

Rialto
44,838

 
67,931

 
88,549

 
109,128

Lennar Multifamily
74,152

 
38,976

 
113,668

 
75,433

Total revenues (1)
$
2,745,815

 
2,392,604

 
4,739,479

 
4,036,743

Operating earnings (loss):
 
 
 
 
 
 
 
Homebuilding East
$
142,938

 
131,566

 
227,644

 
218,099

Homebuilding Central
45,679

 
30,715

 
66,002

 
45,767

Homebuilding West
113,807

 
102,332

 
202,641

 
184,825

Homebuilding Houston
23,083

 
22,738

 
35,955

 
39,753

Homebuilding Other
17,189

 
5,438

 
31,092

 
11,989

Lennar Financial Services
44,088

 
39,053

 
59,019

 
54,580

Rialto
(18,086
)
 
6,881

 
(16,476
)
 
9,689

Lennar Multifamily
14,943

 
(8,706
)
 
27,125

 
(14,388
)
Total operating earnings
383,641

 
330,017

 
633,002

 
550,314

Corporate general and administrative expenses
55,802

 
50,207

 
103,470

 
93,861

Earnings before income taxes
$
327,839

 
279,810

 
529,532

 
456,453


(1)
Total revenues were net of sales incentives of $146.1 million ($21,800 per home delivered) and $249.8 million ($21,700 per home delivered) for the three and six months ended May 31, 2016, respectively, compared to $128.8 million ($21,500 per home delivered) and $222.5 million ($21,600 per home delivered) for the three and six months ended May 31, 2015, respectively.The assets and liabilities related to the Lennar Financial Services segment were as follows:
(In thousands)
May 31,
2016
 
November 30,
2015
Assets:
 
 
 
Cash and cash equivalents
$
105,596

 
106,777

Restricted cash
13,625

 
13,961

Receivables, net (1)
217,692

 
242,808

Loans held-for-sale (2)
862,289

 
843,252

Loans held-for-investment, net
30,671

 
30,998

Investments held-to-maturity
35,307

 
40,174

Investments available-for-sale (3)
49,083

 
42,827

Goodwill
39,439

 
38,854

Other (4)
69,977

 
66,186

 
$
1,423,679

 
1,425,837

Liabilities:
 
 
 
Notes and other debts payable
$
854,055

 
858,300

Other (5)
225,443

 
225,678

 
$
1,079,498

 
1,083,978

(1)
Receivables, net primarily related to loans sold to investors for which the Company had not yet been paid as of May 31, 2016 and November 30, 2015, respectively.
(2)
Loans held-for-sale related to unsold loans carried at fair value.
(3)
Investments available-for-sale are carried at fair value with changes in fair value recorded as a component of accumulated other comprehensive income.
(4)
As of May 31, 2016 and November 30, 2015, other assets included mortgage loan commitments carried at fair value of $18.9 million and $13.1 million, respectively, and mortgage servicing rights carried at fair value of $18.2 million and $16.8 million, respectively. In addition, other assets also included forward contracts carried at fair value of $0.5 million as of November 30, 2015.
(5)
As of May 31, 2016 and November 30, 2015, other liabilities included $58.2 million and $65.0 million, respectively, of certain of the Company’s self-insurance reserves related to construction defects, general liability and workers’ compensation. Other liabilities also included forward contracts carried at fair value of $1.6 million as of May 31, 2016.The assets and liabilities related to the Rialto segment were as follows:
(In thousands)
May 31,
2016
 
November 30,
2015
Assets:
 
 
 
Cash and cash equivalents
$
103,622

 
150,219

Restricted cash (1)
8,579

 
15,061

Receivables, net (2)
—

 
154,948

Loans held-for-sale (3)
199,415

 
316,275

Loans receivable, net
163,805

 
164,826

Real estate owned - held-for-sale
180,547

 
183,052

Real estate owned - held-and-used, net
125,406

 
153,717

Investments in unconsolidated entities
238,740

 
224,869

Investments held-to-maturity
60,076

 
25,625

Other
91,797

 
116,908

 
$
1,171,987

 
1,505,500

Liabilities:
 
 
 
Notes and other debts payable
$
543,310

 
771,728

Other
53,318

 
94,496

 
$
596,628

 
866,224


(1)
Restricted cash primarily consists of upfront deposits and application fees RMF receives before originating loans and is recognized as income once the loan has been originated as well as cash held in escrow by the Company’s loan servicer provider on behalf of customers and lenders and is disbursed in accordance with agreements between the transacting parties.
(2)
Receivables, net primarily relate to loans sold but not settled as of November 30, 2015.
(3)
Loans held-for-sale relate to unsold loans originated by RMF carried at fair value.The assets and liabilities related to the Lennar Multifamily segment were as follows:
(In thousands)
May 31,
2016
 
November 30,
2015
Assets:
 
 
 
Cash and cash equivalents
$
5,067

 
8,041

Land under development
142,921

 
115,982

Consolidated inventory not owned
24,008

 
5,508

Investments in unconsolidated entities
304,171

 
250,876

Other assets
41,922

 
34,945

 
$
518,089

 
415,352

Liabilities:
 
 
 
Accounts payable and other liabilities
$
74,220

 
62,943

Liabilities related to consolidated inventory not owned
15,857

 
4,007

 
$
90,077

 
66,950
Schedule of Other Income (Expense) The following is a detail of Rialto other expense, net:
 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
Realized gains on REO sales, net
$
5,492

 
4,544

 
9,238

 
7,674

Unrealized losses on transfer of loans receivable to REO and impairments, net
(5,396
)
 
(2,212
)
 
(5,549
)
 
(4,768
)
REO and other expenses
(12,123
)
 
(15,167
)
 
(26,958
)
 
(28,409
)
Rental and other income (loss) (1)
(7,558
)
 
11,963

 
2,993

 
24,359

Rialto other expense, net
$
(19,585
)
 
(872
)
 
(20,276
)
 
(1,144
)
(1)
Rental and other income (loss) for both the three and six months ended May 31, 2016, included a $16.0 million write-off of uncollectible receivables related to a hospital, which was acquired through the resolution of one of Rialto's loans from a 2010 portfolio. The hospital is managed by a third-party management company.
Loans Receivable, Net by Type The following table represents loans receivable, net by type:
(In thousands)
May 31,
2016
 
November 30,
2015
Nonaccrual loans: FDIC and Bank Portfolios
$
68,813

 
88,694

Accrual loans
94,992

 
76,132

Loans receivable, net
$
163,805

 
164,826
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, 2016
 
 
 
Recorded Investment
 
 
(In thousands)
Unpaid
Principal Balance
 
With
Allowance
 
Without
Allowance
 
Total  Recorded
Investment
Land
$
100,848

 
47,375

 
132

 
47,507

Single family homes
24,090

 
4,630

 
3,940

 
8,570

Commercial properties
11,440

 
1,009

 
1,072

 
2,081

Other
59,749

 
272

 
10,383

 
10,655

Loans receivable
$
196,127

 
53,286

 
15,527

 
68,813

November 30, 2015
 
 
 
Recorded Investment
 
 
(In thousands)
Unpaid
Principal  Balance
 
With
Allowance
 
Without
Allowance
 
Total  Recorded
Investment
Land
$
145,417

 
59,740

 
1,165

 
60,905

Single family homes
39,659

 
8,344

 
3,459

 
11,803

Commercial properties
13,458

 
1,368

 
1,085

 
2,453

Other
78,279

 
—

 
13,533

 
13,533

Loans receivable
$
276,813

 
69,452

 
19,242

 
88,694
Allowance for Credit Losses on Financing Receivables The activity in the Company's allowance rollforward related to nonaccrual loans was as follows:
 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
Allowance on nonaccrual loans, beginning of the period
$
30,393

 
51,109

 
35,625

 
58,326

Provision for loan losses
4,382

 
1,585

 
6,721

 
2,809

Charge-offs
(5,589
)
 
(12,101
)
 
(13,160
)
 
(20,542
)
Allowance on nonaccrual loans, end of the period
$
29,186

 
40,593

 
29,186

 
40,593
Changes In Real Estate Owned The following tables represent the activity in REO:
 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
REO - held-for-sale, beginning of period
$
177,221

 
185,511

 
183,052

 
190,535

Improvements
708

 
1,591

 
1,595

 
3,295

Sales
(17,441
)
 
(23,213
)
 
(33,951
)
 
(48,138
)
Impairments and unrealized losses
(4,799
)
 
(2,954
)
 
(8,347
)
 
(4,372
)
Transfers from held-and-used, net (1)
24,858

 
34,451

 
38,198

 
54,066

REO - held-for-sale, end of period
$
180,547

 
195,386

 
180,547

 
195,386

 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
REO - held-and-used, net, beginning of period
$
148,900

 
242,569

 
153,717

 
255,795

Additions
2,636

 
5,431

 
11,303

 
14,343

Improvements
(185
)
 
785

 
122

 
1,428

Impairments
(714
)
 
—

 
(803
)
 
(1,413
)
Depreciation
(373
)
 
(586
)
 
(735
)
 
(1,375
)
Transfers to held-for-sale (1)
(24,858
)
 
(34,451
)
 
(38,198
)
 
(54,066
)
Other
—

 
—

 
—

 
(964
)
REO - held-and-used, net, end of period
$
125,406

 
213,748

 
125,406

 
213,748

(1)
During the three and six months ended May 31, 2016 and 2015, the Rialto segment transferred certain properties from REO held-and-used, net to REO held-for-sale as a result of changes in the disposition strategy of the real estate assets.
Schedule of Line of Credit Facilities At May 31, 2016, the Lennar Financial Services segment warehouse facilities were as follows:
(In thousands)
Maximum Aggregate Commitment
364-day warehouse repurchase facility that matures August 2016 (1)
$
600,000

364-day warehouse repurchase facility that matures August 2016
300,000

364-day warehouse repurchase facility that matures October 2016 (2)
450,000

Total
$
1,350,000


(1)
Subsequent to May 31, 2016, the warehouse repurchase facility maturity date was extended to June 2017.
(2)
Maximum aggregate commitment includes an uncommitted amount of $250 million.At May 31, 2016, Rialto warehouse facilities were as follows:
(In thousands)
Maximum Aggregate Commitment
364-day warehouse repurchase facility that matures August 2016 (1)
$
250,000

364-day warehouse repurchase facility that matures October 2016 (one year extension) (1)
400,000

364-day warehouse repurchase facility that matures January 2017 (1)
250,000

Warehouse repurchase facility that matures December 2017 (1)
100,000

Warehouse repurchase facility that matures August 2018 (two - one year extensions) (2)
100,000

Total
$
1,100,000

(1)
RMF uses these facilities to finance its loan origination and securitization activities.
(2)
In 2015, Rialto entered into a separate repurchase facility to finance the origination of floating rate accrual loans. Loans financed under this facility will be held as accrual loans within loans receivable, net. Borrowings under this facility were $53.8 million and $36.3 million as of May 31, 2016 and November 30, 2015, respectively.
Equity Method Investments The total debt of the Lennar Homebuilding unconsolidated entities in which the Company has investments, including Lennar's maximum recourse exposure, were as follows:
(Dollars in thousands)
May 31,
2016
 
November 30,
2015
Non-recourse bank debt and other debt (partner’s share of several recourse)
$
49,606

 
50,411

Non-recourse land seller debt and other debt
323,995

 
324,000

Non-recourse debt with completion guarantees
141,811

 
146,760

Non-recourse debt without completion guarantees
301,331

 
260,734

Non-recourse debt to the Company
816,743

 
781,905

The Company’s maximum recourse exposure (1)
40,851

 
10,981

Total debt
$
857,594

 
792,886

The Company’s maximum recourse exposure as a % of total JV debt
5
%
 
1
%
(1)
The increase in the Company's maximum recourse exposure was primarily related to the Company providing a repayment guarantee on an unconsolidated entity's debt.Summarized condensed financial information on a combined 100% basis related to Lennar Homebuilding’s unconsolidated entities that are accounted for by the equity method was as follows:Statements of Operations
 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
Revenues
$
208,636

 
180,790

 
308,362

 
623,747

Costs and expenses
201,370

 
154,139

 
298,570

 
453,018

Other income
—

 
—

 
—

 
2,943

Net earnings of unconsolidated entities
$
7,266

 
26,651

 
9,792

 
173,672

Lennar Homebuilding equity in earnings (loss) from unconsolidated entities
$
(9,633
)
 
6,494

 
(6,633
)
 
35,393

Balance Sheets
(In thousands)
May 31,
2016
 
November 30,
2015
Assets:
 
 
 
Cash and cash equivalents
$
373,846

 
248,980

Inventories
3,081,630

 
3,059,054

Other assets
921,025

 
465,404

 
$
4,376,501

 
3,773,438

Liabilities and equity:
 
 
 
Accounts payable and other liabilities
$
283,492

 
288,192

Debt
857,594

 
792,886

Equity
3,235,415

 
2,692,360

 
$
4,376,501

 
3,773,438

The following table reflects Rialto's investments in funds that invest in and manage real estate related assets and other investments:
 
 
 
 
 
 
 
 
 
May 31,
2016
 
May 31,
2016
 
November 30,
2015
(Dollars in thousands)
Inception Year
 
Equity Commitments
 
Equity Commitments Called
 
Commitment to Fund by the Company
 
Funds Contributed by the Company
 
Investment
Rialto Real Estate Fund, LP
2010
 
$
700,006

 
$
700,006

 
$
75,000

 
$
75,000

 
$
63,182

 
68,570

Rialto Real Estate Fund II, LP
2012
 
1,305,000

 
1,305,000

 
100,000

 
100,000

 
97,417

 
99,947

Rialto Mezzanine Partners Fund, LP
2013
 
300,000

 
300,000

 
33,799

 
33,799

 
28,206

 
32,344

Rialto Capital CMBS Funds
2014
 
111,753

 
111,753

 
47,057

 
47,057

 
46,712

 
23,233

Rialto Real Estate Fund III
2015
 
818,248

 
—

 
100,000

 
—

 
1,685

 
—

Rialto Credit Partnership, LP
2016
 
220,000

 
8,900

 
19,999

 
809

 
797

 
—

Other investments
 
 
 
 
 
 
 
 
 
 
741

 
775

 
 
 
 
 
 
 
 
 
 
 
$
238,740

 
224,869

Rialto's share of earnings (loss) from unconsolidated entities was as follows:
 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
Rialto Real Estate Fund, LP
$
931

 
3,044

 
2,270

 
3,790

Rialto Real Estate Fund II, LP
2,470

 
2,286

 
1,748

 
3,179

Rialto Mezzanine Partners Fund, LP
701

 
451

 
1,425

 
926

Rialto Capital CMBS Funds
1,208

 
1,533

 
1,580

 
2,077

Rialto Real Estate Fund III
1,622

 
—

 
1,383

 
—

Rialto Credit Partnership, LP
(12
)
 
—

 
(12
)
 
—

Other investments
(56
)
 
14

 
(33
)
 
20

Rialto equity in earnings from unconsolidated entities
$
6,864

 
7,328

 
8,361

 
9,992

Summarized condensed financial information on a combined 100% basis related to Rialto’s investments in unconsolidated entities that are accounted for by the equity method was as follows:Balance Sheets
(In thousands)
May 31,
2016
 
November 30,
2015
Assets:
 
 
 
Cash and cash equivalents
$
122,120

 
188,147

Loans receivable
388,105

 
473,997

Real estate owned
597,915

 
506,609

Investment securities
1,231,257

 
1,092,476

Investments in partnerships
421,272

 
429,979

Other assets
42,889

 
30,340

 
$
2,803,558

 
2,721,548

Liabilities and equity:
 
 
 
Accounts payable and other liabilities
$
24,702

 
29,462

Notes payable
524,416

 
374,498

Equity
2,254,440

 
2,317,588

 
$
2,803,558

 
2,721,548


Statements of Operations
 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
Revenues
$
51,240

 
39,320

 
95,536

 
81,058

Costs and expenses
20,704

 
25,082

 
41,603

 
48,087

Other income, net (1)
26,710

 
55,477

 
11,548

 
61,351

Net earnings of unconsolidated entities
$
57,246

 
69,715

 
65,481

 
94,322

Rialto equity in earnings from unconsolidated entities
$
6,864

 
7,328

 
8,361

 
9,992


(1)
Other income, net, included realized and unrealized gains (losses) on investmentsSummarized condensed financial information on a combined 100% basis related to Lennar Multifamily's investments in unconsolidated entities that are accounted for by the equity method was as follows:
Balance Sheets
(In thousands)
May 31,
2016
 
November 30,
2015
Assets:
 
 
 
Cash and cash equivalents
$
58,962

 
39,579

Operating properties and equipment
1,748,003

 
1,398,244

Other assets
41,778

 
25,925

 
$
1,848,743

 
1,463,748

Liabilities and equity:
 
 
 
Accounts payable and other liabilities
$
241,079

 
179,551

Notes payable
578,662

 
466,724

Equity
1,029,002

 
817,473

 
$
1,848,743

 
1,463,748


Statements of Operations
 
Three Months Ended
 
Six Months Ended
 
May 31,
 
May 31,
(In thousands)
2016
 
2015
 
2016
 
2015
Revenues
$
9,649

 
3,075

 
17,963

 
5,169

Costs and expenses
14,058

 
5,081

 
25,730

 
8,075

Other income, net
30,272

 
—

 
70,394

 
—

Net earnings (loss) of unconsolidated entities
$
25,863

 
(2,006
)
 
62,627

 
(2,906
)
Lennar Multifamily equity in earnings (loss) from unconsolidated entities (1)
$
14,008

 
(422
)
 
33,694

 
(600
)
(1)
For the three months ended May 31, 2016, Lennar Multifamily equity in earnings from unconsolidated entities included the segment's $15.4 million share of a gain as a result of the sale of an operating property by one of its unconsolidated entities. For the six months ended May 31, 2016, Lennar Multifamily equity in earnings from unconsolidated entities included the segment's $35.8 million share of gains as a result of the sale of two operating properties by its unconsolidated entities.The Company’s recorded investments in unconsolidated entities were as follows:
(In thousands)
May 31,
2016
 
November 30,
2015
Lennar Homebuilding
$
785,883

 
741,551

Rialto
$
238,740

 
224,869

Lennar Multifamily
$
304,171

 
250,876