WSJ is reporting that Lennar Corp. has sold lots for 40 cents on the dollar. They sold the lots for $525 million that was valued at $1.3 billion in September. Lennar will have 20% stake with option to buy back lots.
Hedge funds and bankers want builders to have stake as they have the knoweldge. So don't expect this from builders that are close to bankruptcy.
http://online.wsj.com/article/SB119664527659511255.html?mod=hpp_us_whats_news&apl=y&r=712196The deal, which closed with little fanfare Friday night, could be a catalyst for other "vulture" investors to swoop in and grab discounted land from other troubled builders. A wide range of investors have been raising money from pension funds and private-equity firms to acquire land.
"It's a good deal for Morgan Stanley" says Ivy Zelman, chief executive of Zelman & Associates, an independent housing research firm. "They are getting the lots at 40 cents on the dollar and Lennar will manage the venture and provide their home-building expertise for a fee." A Morgan Stanley spokeswoman declined to comment.
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