Warren Buffett’s Berkshire Hathaway invests nearly $800M in homebuilding giant Lennar

Warren Buffett’s Berkshire Hathaway made a major investment in Miami-based homebuilding giant Lennar, purchasing over 7 million shares for nearly $800 million in the first half of this year.

Berkshire Hathaway bought 5.3 million shares of Lennar for $575 million in the second quarter, Berkshire revealed in a Securities and Exchange Commission filing on Thursday. The investment followed Berkshire’s purchase of 1.8 million Lennar shares for $222 million in the first quarter.

The investment gave Lennar stock a major boost, with its stock trading at over $135 per share on Friday morning, or more than 4 percent higher than Thursday’s closing price. By 3:30 p.m. on Friday, Lennar’s share price dropped to $132.40, or up 1.95 percent from Thursday’s closing.

Berkshire Hathaway also made a smaller investment in Arlington, Texas-based homebuilder D.R. Horton, buying 1.5 million shares for about $203 million in the first quarter. It sold 27,000 D.R. Horton shares for an estimated $3.3 million in the second quarter.

Led by co-CEOs Stuart Miller and Jon Jaffe, Lennar is a major homebuilder in South Florida. The firm has particularly seized on south Miami-Dade County, an area with a vast land supply that comes at a discount compared with development sites in South Florida’s urban cores.

Its most recent proposals are for the Retro West complex with 106 townhouses on a 10-acre site on the northwest corner of Southwest 338th Street and Southwest 192nd Avenue in unincorporated Miami-Dade, near Homestead. In January, Lennar filed an application to develop Rodan Estates with 138 single-family homes on a 20-acre site on the southeast corner of Southwest 220th Street and Southwest 133rd Court near Goulds, as well as a community with 54 homes on a 9.2-acre site on the southeast corner of Southwest 212th Street and Southwest 127th Avenue in Goulds.

Lennar bought three south Miami-Dade residential developments from Coral Gables-based Century Homebuilders Group for a combined $24.8 million. The properties are Portobello Estates at Southeast 18th Avenue and the Florida Turnpike Extension, where 54 single-family homes are proposed; Century Park Villas East at Northeast First Avenue and Palm Drive in Homestead, proposed for 117 townhomes; and Century Estates Royal at 192nd Avenue and Mowry Drive in Homestead, proposed for 54 units in 27 duplexes and three single-family homes.

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