Millrose Properties, Inc. reported fourth‑quarter and full‑year 2025 results that surpassed expectations, delivering a net income of $2.44 per share for the year and $0.74 per share for the quarter. Adjusted Funds From Operations (AFFO) reached $0.76 per share in the quarter, a 10% increase from the prior year’s $0.68 per share, and totaled $2.58 per share for the full year, underscoring the company’s ability to generate recurring cash flow through its Homesite Option Purchase Platform.
The company’s portfolio of homesites under option contracts grew to $9.2 billion, while invested capital outside the Lennar Master Program Agreement reached $2.4 billion—surpassing the $2.2 billion stretch target set for 2025. Zero option terminations across the portfolio highlight the stability of its builder relationships and the resilience of its contractual model.
"2025 was a defining year for Millrose," said CEO and President Darren Richman. "Despite a cautious homebuilding environment, our platform gained strong industry traction – exceeding our expectations. We surpassed our stretch investment target, grew to 15 builder counterparties, and navigated affordability headwinds and macro uncertainty without a single option termination. Recurring contractual income grew, capital recycled efficiently, and our platform expanded accretively – delivering above our original plan."
Management guided that it will deploy an additional $1 billion of invested capital by mid‑2026, targeting a second‑quarter 2026 AFFO run rate of $0.78–$0.80 per share. With a debt‑to‑capitalization ratio of 26% and $1.3 billion in liquidity, the balance sheet remains conservative while supporting the planned growth. The company also raised its quarterly dividend to $0.75 per share, reflecting its commitment to return 100% of AFFO to shareholders.
The results reflect a combination of strong demand for builder‑partner contracts, disciplined cost management, and successful diversification beyond the Lennar Master Program Agreement. The zero‑termination record indicates robust builder confidence, while the expansion of invested capital outside the Lennar partnership reduces concentration risk and positions Millrose to capture additional market share. The 10% year‑over‑year AFFO growth demonstrates operational leverage and pricing power within the homesite option model.
Looking ahead, the company’s guidance signals confidence in a more constructive housing backdrop for 2026. The planned capital deployment and higher AFFO run‑rate target suggest that management expects continued demand for its platform and believes it can maintain attractive yields while scaling its portfolio. The conservative leverage profile and liquidity cushion provide flexibility to navigate potential macro‑economic headwinds, reinforcing Millrose’s long‑term competitive position in the residential land finance sector.
The dividend increase and the company’s focus on recycling capital reinforce its strategy of delivering consistent, high‑yield returns to investors while expanding its platform and diversifying its builder base. These factors collectively support a positive outlook for Millrose’s earnings trajectory and shareholder value creation.
The content on EveryTicker is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.