As U.S. homebuilders retrench from aggressive land positions — cancelling contracts, slowing takedowns, and retrading previously negotiated deals — the land risk pendulum is swinging in real time. Yet Millrose Properties, the giant landbanking and horizontal development platform spun out of Lennar, posted Q3 2025 results that run counter to that trend: no builder walkaways, no renegotiations, and strong capital deployment velocity.

This isn’t just good news for Millrose — it’s a case study in what resilience looks like when land strategy meets operational precision.

Where many builders are dialing back on new lot exposure to preserve margin and liquidity, Millrose has doubled down on disciplined underwriting, structured contracts, and a data-first technology platform that screens every deal against real-time market risk.

The firm’s ability to average 138 homesite takedowns per business day across 12 builder relationships — without a single partner balking — offers a sharp contrast to peers navigating a high-stakes environment of uncertain pace and profitability.

Millrose isn’t immune to macro volatility. But its performance this quarter reinforces a key emerging dynamic in the current cycle: in a risk-off market, platforms with capital discipline, tech-enabled transparency, and carefully selected partners are the ones still playing offense.

Here’s the deeper look at how Millrose pulled it off — and what it signals for land strategies heading into 2026.

The company’s Q3 2025 earnings reveal an operator navigating today’s choppy waters with a sound, technology-driven, risk-averse approach to growth as it shifts away from its reliance on Lennar.

The land banking and horizontal development firm posted strong growth, even as many homebuilders, such as Tri Pointe Homes, are scaling back new home production amid declining homebuyer demand, price constraints, softening consumer sentiment, and economic uncertainty. 

Shareholders may be pleased to learn that Millrose hasn’t had a single homebuilder walk away from or renegotiate a contract despite these challenging market conditions. CEO and President Darren Richman largely attributed this strong performance to the company’s underwriting standards and technology, which allows for thorough due diligence when evaluating deals. 

The due diligence screening that we do as part of our overlay is really the glue that holds this all together,” Richman said. 

How Technology Sets Millrose Properties Apart

For Millrose, its focus on technology brings three distinct advantages that deliver strong results for its clients and robust due diligence in deal evaluations, according to CTO Adil Pasha. 

First, Millrose has created a rich, proprietary data set derived from the company’s deal flow, transactions, and builder sales reports, which aids in due diligence. 

This data moat gives us unique insights into underwriting transactions and monitoring market risk. We are also beginning to leverage AI to drive novel insights from this data set and further automate internal processes,” Pasha explained. 

Secondly, Pasha boasted that Millrose has mastered M&A execution through its underwriting capabilities, including its involvement in Lennar’s acquisition of Rausch Coleman Homes and New Home’s acquisition of Landsea. 

Our ability to partner with builders to rapidly underwrite and integrate hundreds of communities is a direct result of our proprietary data platform, which automates the ingestion and management of all aspects of land banking data."

Lastly, the technology enables high-velocity transaction processing, empowering Millrose to average 138 homesite takedowns per business day.

Choosing Partners Wisely 

After Millrose split off from Lennar, the two parties agreed to the Lennar Master Program, in which Millrose acquires land and grants Lennar options to purchase homesites on those properties. 

The partnership is vital to Millrose’s success. Still, the company has also worked diligently to build relationships with more homebuilders — currently, the operator partners with 12 distinct homebuilders, up from 11 in the previous quarter. 

During the call, Richman gave a special shoutout to Millrose’s partnership with Taylor Marrison’s Yardly build-to-rent brand to exemplify the kind of builder that the company seeks to work with. 

We’re also looking for a counterparty that is really a partner, and we're looking for counterparties that are looking to do business for capital efficiency, not risk mitigation.”

According to Richman, Millrose “would rather pass on those relationships than try to eke out a little bit more spread" while taking on a lot more risk.

Millrose views technology as a core competitive advantage, enabling the company to scale up more quickly and deliver superior service and operational efficiency to its clients. According to executives, this allows the company to be selective in its partnerships. 

Given the demand we have observed, we also have the ability to remain selective in our partnerships,” Richman said. “This has helped to buttress our portfolio during the recent market stress.”

Mitigating Risk is a Core Principle

Millrose’s strict underwriting standards and due diligence, bolstered by its technology, are key to its decision-making when determining which deals to pursue — and which to turn down. 

Part of our risk underwriting is that we're always, as we said, evaluating a homebuilder's assumptions around price and pace and ultimately, the gross margin they project on those communities. And we, in this quarter, just as in all other quarters, turned down a substantial amount of deals because we didn't think they were set up for success, in that our own unique independent data sources were not necessarily consistent with the builders' underwriting,” Richman explained. 

Millrose also structures its transactions to mitigate risk by securing large deposits and using cross-termination pooling mechanisms to protect itself if a deal goes south.

However, Millrose’s contracts remain in a strong position due to the operator’s steady, disciplined growth, even in a soft market marked by muted homebuyer demand. Richman claimed that his team hasn’t seen any meaningful changes in their business.

We would highlight it, and we just haven't seen it. It really has been sort of business as usual for us, which has been great. And it's not like we haven't seen what's going on in the backdrop, but you got to remember, we've underwritten all these assets. These are mission-critical assets. These are irreplaceable assets, by and large, and we would expect that the builders would continue to take them down almost regardless of what is going on in the backdrop.”

Maintaining Flexibility With Partners

Despite this strength, Millrose isn’t naive about the realities of the current market. While the company’s partners have not yet walked away from or renegotiated a deal, future renegotiations may be necessary if needed. 

If a builder, for example, needs to reduce the number of monthly takedowns, Millrose is open to negotiating. 

We haven't had to make accommodations outside of what our builder counterparties are entitled to, but we would definitely be open if asked, making sure that we have the capital to do it,” Millrose explained. 

Preparing for Future Growth

Millrose’s invested capital outside of the Lennar Master Program Agreement is $1.8 billion, a bit shy of its stretched quarterly target of $2 billion. The company’s revised target is now $2.2 billion, a $400 million increase from its current position. 

The firm strengthened its financial position in Q3 through a strategic debt raise, but remains committed to a conservative approach to debt. The company has a debt-to-capitalization ratio of about 25% and expects to maintain a conservative maximum of 33% going forward. 

We're comfortable based on all the liquidity we have today and our capital pipeline that we can serve everything, and there does remain additional capacity to bring on new customers,” COO Robert Nitkin said. 

Key Takeaway

Millrose maintained a strong position in Q3, with no customers walking away or renegotiating contracts, even though many homebuilders are pulling back on new home starts. 

The company’s commitment to a technology-driven, data-informed underwriting approach, along with its selective selection of homebuilding partners, is a big reason for this success. 

While Millrose has its own unique business focus, its approach to evaluating deals could offer insights for other firms looking to leverage data and technology more effectively in their due diligence.