Lennar

Building houses and facilitating home ownership fulfils a vital societal need. Lennar mainly builds homes for purchase by middle- and working-class families, rather than luxury apartments or second homes. In the affordable market, the company operates through sub-brands, such as NuHome and American Dream. Through their Upward America rental brand, they offer single-home rentals for families not yet able to buy a property.

Lennar is noted for its technical leadership. For example, it is a US market leader in solar-powered homes, notably in California. Lennar is also a pioneer of 3-D printing in home construction, aiming to minimise the environmental footprint of the construction process itself, not just the ongoing efficiency of the buildings once instructed. It also incorporates further resource-efficiency technology such as residential water-recycling systems.

Pursuing a strategy of becoming a focused manufacturer of new homes, Lennar is a leader in an attractive and growing industry. The company’s strong balance sheet and potential for cash generation are expected to produce further returns of capital to shareholders. 

As a property developer, the company inevitably has substantial environmental impacts. These include land transformation and habitat disruption. Despite a focus on developing more energy efficient construction techniques, their energy and raw material consumption is still significant. Understanding how the company’s activities can incorporate further efficiencies will be key.

Climate change remains a material risk for the company as it can affect the availability and cost of construction materials, resulting in delays in completion of projects and higher costs for customers. 

The company’s operations carry a number of risks related to labour and human rights. Construction work is physically demanding and carries a high risk of injury or fatality, making workforce health and safety a key area for engagement. Potential risks of accidents include lost time to injury, as well as legal and financial consequences. 

The construction sector, both directly and through material procurement, is also vulnerable to modern slavery. Despite efforts to improve transparency, managing and auditing supply chains which include raw materials remains difficult.