Lennar Corporation has acquired 5,500 distressed residential and commercial loans with a face value of $3.05 billion from the FDIC for just $243 million.
Stuart Miller, Lennar president and chief executive officer
The deal sees the homebuilder take a 40 percent stake in a new company that will hold the loans, while the US banking regulator, the Federal Deposit Insurance Corporation, retains a 60 percent interest. 
Acquiring and working out distressed real estate loans was a large and extremely profitable part of our business during the last major real estate down cycle in the early 1990s.
In a statement, Lennar said it had been “carefully preparing” to return to its roots investing in distressed debt deals for the past two years. Stuart Miller, Lennar president and chief executive officer, said: “Acquiring and working out distressed real estate loans was a large and extremely profitable part of our business during the last major real estate down cycle in the early 1990s.”
The FDIC pooled the 5,500 loans from 22 failed bank receiverships. Private equity and fixed income investment firm Rialto Capital Advisors will manage and workout the portfolio. Under the terms of the deal, the FDIC is providing $627 million of non-recourse financing at zero percent interest for seven years.
In January, Los Angeles-based Colony Capital bought an FDIC portfolio of more than 1,200 loans with a face value of $1.02 billion for an equity investment of $90.5 million. The FDIC provided government financing of $233 million in corporate guaranteed notes.
Colony is believed to have spent two months working with the FDIC on its January bid, fighting off competition from more than 40 potential groups and more than 20 bids (only a few of which were for the entire portfolio).
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