Why is Lennar—the largest homebuilder in America—still not building in Columbus, Ohio

Question

Why is Lennar—the largest homebuilder in America—still not building in Columbus, Ohio?

A top 10 metro for population growth.A top 5 market for land velocity.And still—no Lennar.

Meanwhile, DR Horton is scaling. MI Homes is local. Maronda, Arbor, and Fischer are all grabbing dirt.

So what’s missing?

The right land entitlement partner.

Central Ohio doesn’t need more builders. It needs pre-capitalized, high-velocity entitlement teams who can control land, deliver zoning, and feed national builders at scale.

We think Lennar’s entry isn’t a matter of if—it’s about who they trust to break the ground.

Tag your Lennar contacts👇Let’s open the conversation.

#Lennar #DRHorton #MIHomes #LandEntitlement #RealEstateDevelopment #ColumbusOhio #LandBanking #NationalBuilders #ResidentialConstruction #MidwestHousing #EntitledLand #HousingCrisis #Zoning #BuildToSell #SuburbanGrowth #NewConstruction

Michael K Gallagher · Answer

@Robert Ellis love this attitude and very much tend to agree with the logic.  Plenty of land here, just needs entitled.  very cool way to add value.

Jay Hinrichs · Answer

back in 2004 or so when one of my business's was a retail brokerage.  I sold a few subdivisions in Portland Metro and Vancouver that were purpose build to rent.

U dont see it anymore at least I dont.. land is too expensive. U would need rents to be in the 5k range to make any kind of sense of it and right now rents ceiling in that kind of setting at lest in the PDX metro is about 3k .. U might find a few one offs in starter home development.

But thats about it. the project i just funded over in Bend is 140 townhouses that will go retail thats starter housing in that market..  And then the parcel next to it Lennars MF arm is developing it with 300 apartments..

Apartment building in the Portland proper has ground to a halt.. The city a few years ago now requires about 20 or 25% of the doors to be low income units.. private sector wont do that not when it cost 400k or so to build one apartment.

Robert Ellis · Answer

I'm glad I have access to cheap land in COLUMBUS Ohio

Jay Hinrichs · Answer

I have funded two deals for Lennar pre development..  One in Oregon last week

140 townhouses and 300 apartments their apartment division builds out the apartments but same piece of dirt. this was 1.2 mil..

And one in WA DC  300 plus lots with combination of townhouse and SFR product. little less investment than Oregon one..

The Oregon NW regional director is a Colleague of mine who I have known for years.. the WA DC I dont know and my client is dealing with that office.

I am all about controlling land in path of progress and entitlements for the right companies but also keep in mind this is generally unsecured money so high risk with VERY HIGH costs.. And just because Lennar or Horton or anyone else drops a nice 200 to 500k non refundable EM does not mean they will close.. they will walk in a heartbeat if the market shifts.. I knew some guys doing lot development for these big companies that lost it all in the GFC when these companies failed to close and left them holding the bag.

Its funny you bring this up I wrote my OR contact just yesterday asking him how I can get intro in other markets to help with these pre development funds we like to do ( VERY SELECTIVELY of course) and he said they really don't communicate outside of their territories.

Why they have not gone into Ohio I am not sure.. Could be that Intel is melting down and might not be the big driver we all thought it was going to be.  But i am sure there are other companies coming to that area.

Robert Ellis · Answer

they had one development in Grove City but backed out. They 70% of the market in miami but yet none in columbus. We are looking at build to rent as well as the majority of our strategy. Columbus is #1 city in ohio for build to rent in the most recent report and DR Horton is already introducing this in their subdivisions. I agree on the risk we are working with land entitlement partners who have sold to these companies in Texas and Carolinas. We already have several land contacts and are not going in blind to any of these. Build to sell model is not the stronger model right now it's build to rent individually platted. These are what DR horton is building for rental product and sold the entire package to a firm in Chicago. This is a 3 bed 3 bath with 2 car garage attached product 0 lotline development with 6 per building. They sold the entire package of these before they were leased up. Rents are $2600 on about 1635 square feet. which is maybe $1.59 a square foot which is pretty good. The numbers are better on 3 bed ranches but lower density. One of the largest BTR guys I know who's doing 1000 right now in Florida and Carolina said $1.70 is what he looks for but he's also institutional level and pretty sophisticated so I've been data mapping the BTR guys return profiles in our market to entitle an entire site for a BTR and exit. Have you done that in your market yet? But I don't see it in the Northwest not even in the top 20 markets by the most recent Yardi report.

Why is Lennar—the largest homebuilder in America—still not building in Columbus, Ohio

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