The recovery of the home-building market promises to be slow and rocky, but builder Lennar Corp. has found what it thinks will be a way to juice its earnings: buying distressed real estate loans.
The Miami builder’s shares surged nearly 9% on Thursday after it announced late Wednesday winning an auction for a portfolio of about 5,500 residential and commercial real estate loans from 22 failed banks. Lennar agreed to pay $243 million for a 40% stake in the portfolio. The rest will be held by the Federal Deposit Insurance Corp.
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