Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 01, 2022 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-38545 | |
Entity Registrant Name | Landsea Homes Corporation | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-2196021 | |
Entity Address, Address Line One | 660 Newport Center Drive | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, City or Town | Newport Beach | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92660 | |
City Area Code | 949 | |
Local Phone Number | 345-8080 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 40,950,043 | |
Entity CIK | 0001721386 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Common Class A | NASDAQ | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Trading Symbol | LSEA | |
Security Exchange Name | NASDAQ | |
Warrant | NASDAQ | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Warrants exercisable for Common Stock | |
Trading Symbol | LSEAW | |
Security Exchange Name | NASDAQ |
Consolidated Balance Sheets - (
Consolidated Balance Sheets - (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Assets | ||
Cash and cash equivalents | $ 110,192 | $ 342,810 |
Cash held in escrow | 7,190 | 4,079 |
Restricted cash | 0 | 443 |
Real estate inventories (including related party interest of $3,909 and $7,509, respectively) | 1,179,418 | 844,792 |
Due from affiliates | 5,180 | 4,465 |
Investment in and advances to unconsolidated joint ventures (including related party interest of $0 and $70, respectively) | 0 | 470 |
Goodwill | 68,639 | 24,457 |
Other assets (including right-of-use assets with a related party of $1,454 and $2,010, respectively) | 98,239 | 43,998 |
Total assets | 1,468,858 | 1,265,514 |
Liabilities | ||
Accounts payable | 82,347 | 73,734 |
Accrued expenses and other liabilities (including lease liabilities with a related party of $1,454 and $2,010, respectively) | 114,836 | 97,724 |
Due to affiliates | 2,357 | 2,357 |
Warrant liability | 0 | 9,185 |
Notes and other debts payable, net | 585,065 | 461,117 |
Total liabilities | 784,605 | 644,117 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.0001 par value, 50,000,000 shares authorized, none issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | 0 | 0 |
Common stock, $0.0001 par value, 500,000,000 shares authorized, 42,110,794 issued and 40,950,043 outstanding as of September 30, 2022, 46,281,091 issued and outstanding as of December 31, 2021 | 4 | 5 |
Additional paid-in capital | 497,078 | 535,345 |
Retained earnings | 132,767 | 84,797 |
Total stockholders' equity | 629,849 | 620,147 |
Noncontrolling interests | 54,404 | 1,250 |
Total equity | 684,253 | 621,397 |
Total liabilities and equity | $ 1,468,858 | $ 1,265,514 |
Consolidated Balance Sheets -_2
Consolidated Balance Sheets - (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Real estate inventories | $ 1,179,418 | $ 844,792 |
Investment in unconsolidated joint venture | 0 | 470 |
Other assets | 98,239 | 43,998 |
Accrued expenses and other liabilities | $ 114,836 | $ 97,724 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 42,110,794 | 46,281,091 |
Common stock, shares outstanding (in shares) | 40,950,043 | 46,281,091 |
Affiliated Entity | ||
Real estate inventories | $ 3,909 | $ 7,509 |
Investment in unconsolidated joint venture | 0 | 70 |
Other assets | 1,454 | 2,010 |
Accrued expenses and other liabilities | $ 1,454 | $ 2,010 |
Consolidated Statement of Opera
Consolidated Statement of Operations - (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenue | $ 335,585 | $ 214,129 | $ 1,020,491 | $ 624,822 |
Total cost of sales | 269,099 | 178,768 | 810,766 | 528,106 |
Gross margin | 66,486 | 35,361 | 209,725 | 96,716 |
Sales and marketing expenses | 21,063 | 12,299 | 64,366 | 34,880 |
General and administrative expenses | 21,111 | 16,905 | 70,734 | 45,826 |
Total operating expenses | 42,174 | 29,204 | 135,100 | 80,706 |
Income from operations | 24,312 | 6,157 | 74,625 | 16,010 |
Other income (expense), net | 920 | 394 | (793) | 3,927 |
Equity in net income of unconsolidated joint ventures (including related party interest expense of $0, $278, $69 and $1,042, respectively) | 70 | 168 | 139 | 814 |
Gain (loss) on remeasurement of warrant liability | 0 | 7,040 | (7,315) | (3,245) |
Pretax income | 25,302 | 13,759 | 66,656 | 17,506 |
Provision for income taxes | 4,021 | 2,977 | 17,460 | 3,160 |
Net income | 21,281 | 10,782 | 49,196 | 14,346 |
Net income (loss) attributable to noncontrolling interests | 1,311 | (15) | 1,226 | (41) |
Net income attributable to Landsea Homes Corporation | $ 19,970 | $ 10,797 | $ 47,970 | $ 14,387 |
Income per share: | ||||
Basic (in dollars per share) | $ 0.49 | $ 0.23 | $ 1.10 | $ 0.31 |
Diluted (in dollars per share) | $ 0.49 | $ 0.23 | $ 1.09 | $ 0.31 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 39,935,152 | 45,281,091 | 42,768,269 | 45,077,015 |
Diluted (in shares) | 40,097,269 | 45,329,891 | 42,943,871 | 45,146,552 |
Home sales | ||||
Revenue | $ 326,496 | $ 208,916 | $ 975,269 | $ 603,281 |
Cost of sales and expenses | 258,362 | 175,349 | 770,220 | 511,177 |
Gross margin | 68,134 | 33,567 | 205,049 | 92,104 |
Lot sales and other | ||||
Revenue | 9,089 | 5,213 | 45,222 | 21,541 |
Cost of sales and expenses | 10,737 | 3,419 | 40,546 | 16,929 |
Gross margin | $ (1,648) | $ 1,794 | $ 4,676 | $ 4,612 |
Consolidated Statement of Ope_2
Consolidated Statement of Operations - (Unaudited) - Parenthetical - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenue | $ 335,585 | $ 214,129 | $ 1,020,491 | $ 624,822 |
Affiliated Entity | ||||
Previously capitalized related party interest included in cost of sales | 0 | 278 | 69 | 1,042 |
Lot Sales and Other | Affiliated Entity | ||||
Revenue | 0 | 0 | 1,249 | 0 |
Cost of sales and expenses | 0 | 0 | 1,256 | 0 |
Home sales | ||||
Revenue | 326,496 | 208,916 | 975,269 | 603,281 |
Cost of sales and expenses | 258,362 | 175,349 | 770,220 | 511,177 |
Home sales | Affiliated Entity | ||||
Previously capitalized related party interest included in cost of sales | $ 714 | $ 2,571 | $ 3,831 | $ 9,813 |
Consolidated Statements of Equi
Consolidated Statements of Equity - (Unaudited) - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Cumulative Effect, Period of Adoption, Adjusted Balance | Common Stock | Common Stock Cumulative Effect, Period of Adoption, Adjustment | Common Stock Cumulative Effect, Period of Adoption, Adjusted Balance | Additional paid-in capital | Additional paid-in capital Cumulative Effect, Period of Adoption, Adjustment | Additional paid-in capital Cumulative Effect, Period of Adoption, Adjusted Balance | Retained earnings | Retained earnings Cumulative Effect, Period of Adoption, Adjustment | Retained earnings Cumulative Effect, Period of Adoption, Adjusted Balance | Noncontrolling interests | Noncontrolling interests Cumulative Effect, Period of Adoption, Adjustment | Noncontrolling interests Cumulative Effect, Period of Adoption, Adjusted Balance |
Beginning balance (in shares) at Dec. 31, 2020 | 32,600,000 | 1,000 | 32,556,303 | 32,557,303 | |||||||||||
Beginning balance at Dec. 31, 2020 | $ 529,486 | $ 0 | $ 529,486 | $ 0 | $ 3 | $ 3 | $ 496,174 | $ (3) | $ 496,171 | $ 32,011 | $ 0 | $ 32,011 | $ 1,301 | $ 0 | $ 1,301 |
Increase (Decrease) in Shareholders' Equity | |||||||||||||||
Recapitalization transaction, net of fees and deferred taxes (in shares) | 13,673,722 | ||||||||||||||
Recapitalization transaction, net of fees and deferred taxes | 31,662 | $ 2 | 31,660 | ||||||||||||
Vesting of restricted stock units (in shares) | 50,066 | ||||||||||||||
Vesting of restricted stock units | 0 | ||||||||||||||
Stock-based compensation expense | 4,056 | 4,056 | |||||||||||||
Net income (loss) | 14,346 | 14,387 | (41) | ||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 46,281,091 | ||||||||||||||
Ending balance at Sep. 30, 2021 | 579,550 | $ 5 | 531,887 | 46,398 | 1,260 | ||||||||||
Beginning balance (in shares) at Jun. 30, 2021 | 46,281,091 | ||||||||||||||
Beginning balance at Jun. 30, 2021 | 567,541 | $ 5 | 530,660 | 35,601 | 1,275 | ||||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||||||||
Stock-based compensation expense | 1,227 | 1,227 | |||||||||||||
Net income (loss) | 10,782 | 10,797 | (15) | ||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 46,281,091 | ||||||||||||||
Ending balance at Sep. 30, 2021 | $ 579,550 | $ 5 | 531,887 | 46,398 | 1,260 | ||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | 46,281,091 | 46,281,091 | |||||||||||||
Beginning balance at Dec. 31, 2021 | $ 621,397 | $ 5 | 535,345 | 84,797 | 1,250 | ||||||||||
Ending balance (in shares) at Jun. 30, 2022 | 40,925,579 | ||||||||||||||
Ending balance at Jun. 30, 2022 | $ 665,136 | $ 4 | 496,170 | 112,797 | 56,165 | ||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | 46,281,091 | 46,281,091 | |||||||||||||
Beginning balance at Dec. 31, 2021 | $ 621,397 | $ 5 | 535,345 | 84,797 | 1,250 | ||||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||||||||
Shares issued under share based awards (in shares) | 228,529 | ||||||||||||||
Cash paid for shares withheld for taxes | (848) | (848) | |||||||||||||
Stock-based compensation expense | 2,780 | 2,780 | |||||||||||||
Repurchase of common stock (in shares) | (5,559,577) | ||||||||||||||
Repurchase of common stock | (40,200) | $ (1) | (40,199) | ||||||||||||
Contributions from noncontrolling interests | 55,000 | 55,000 | |||||||||||||
Distributions to noncontrolling interests | (3,072) | (3,072) | |||||||||||||
Net income (loss) | $ 49,196 | 47,970 | 1,226 | ||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | 40,950,043 | 40,950,043 | |||||||||||||
Ending balance at Sep. 30, 2022 | $ 684,253 | $ 4 | 497,078 | 132,767 | 54,404 | ||||||||||
Beginning balance (in shares) at Jun. 30, 2022 | 40,925,579 | ||||||||||||||
Beginning balance at Jun. 30, 2022 | 665,136 | $ 4 | 496,170 | 112,797 | 56,165 | ||||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||||||||
Shares issued under share based awards (in shares) | 24,464 | ||||||||||||||
Stock-based compensation expense | 908 | 908 | |||||||||||||
Distributions to noncontrolling interests | (3,072) | (3,072) | |||||||||||||
Net income (loss) | $ 21,281 | 19,970 | 1,311 | ||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | 40,950,043 | 40,950,043 | |||||||||||||
Ending balance at Sep. 30, 2022 | $ 684,253 | $ 4 | $ 497,078 | $ 132,767 | $ 54,404 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net income | $ 49,196 | $ 14,346 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Depreciation and amortization | 4,445 | 3,240 |
Loss on remeasurement of warrant liability | 7,315 | 3,245 |
Stock-based compensation expense | 2,780 | 4,056 |
Loss (gain) on extinguishment or forgiveness of debt | 2,496 | (4,265) |
Abandoned project costs | 324 | 380 |
Equity in net income of unconsolidated joint ventures | (139) | (814) |
Deferred taxes | (2,217) | (1,221) |
Changes in operating assets and liabilities: | ||
Cash held in escrow | (3,111) | (2,920) |
Real estate inventories | (99,397) | (123,874) |
Due from affiliates | (715) | (1,488) |
Other assets | (46,748) | (5,982) |
Accounts payable | 2,284 | 17,461 |
Accrued expenses and other liabilities | 287 | (28,110) |
Net cash used in operating activities | (83,200) | (125,946) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (4,062) | (2,309) |
Distributions of capital from unconsolidated joint ventures | 578 | 17,855 |
Payments for business acquisition, net of cash acquired | (258,727) | (44,537) |
Net cash used in investing activities | (262,211) | (28,991) |
Cash flows from financing activities: | ||
Borrowings from notes and other debts payable | 361,910 | 491,535 |
Repayments of notes and other debts payable | (240,526) | (424,006) |
Proceeds from the Merger, net of fees and other costs | 0 | 64,434 |
Cash paid for shares withheld for taxes | (848) | 0 |
Payment for buyback of warrants | (16,500) | 0 |
Repayment of convertible note | 0 | (1,500) |
Repurchases of common stock | (40,200) | 0 |
Contributions from noncontrolling interests | 55,000 | 0 |
Distributions to noncontrolling interests | (3,072) | 0 |
Deferred offering costs paid | 0 | (1,832) |
Debt issuance and extinguishment costs paid | (3,414) | (1,382) |
Net cash provided by financing activities | 112,350 | 127,249 |
Net decrease in cash, cash equivalents, and restricted cash | (233,061) | (27,688) |
Cash, cash equivalents, and restricted cash at beginning of period | 343,253 | 110,048 |
Cash, cash equivalents, and restricted cash at end of period | $ 110,192 | $ 82,360 |
Company
Company | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Company | Company Landsea Homes Corporation (together with its subsidiaries, “LHC” or the “Company”), a majority owned subsidiary of Landsea Holdings Corporation (“Landsea Holdings”), is engaged in the acquisition, development, and sale of homes and lots in Arizona, California, Florida, New Jersey, New York, and Texas. The Company's operations are organized into the following five reportable segments: Arizona, California, Florida, Metro New York, and Texas. On August 31, 2020, LHC and its parent, Landsea Holdings, entered into an Agreement and Plan of Merger (the “Merger Agreement”) with LF Capital Acquisition Corp. (“LF Capital”) and LFCA Merger Sub, Inc. (the “Merger Sub”), a direct, wholly-owned subsidiary of LF Capital. The Merger Agreement provided for, among other things, the merger of Merger Sub with and into Landsea Homes Incorporated (“LHI”), previously a wholly-owned subsidiary of Landsea Holdings, with LHI continuing as the surviving corporation (the “Merger”). On January 7, 2021 (the “Closing Date”), the Merger was consummated pursuant to the Merger Agreement (the “Closing”). The name of LF Capital was changed at that time to Landsea Homes Corporation. Subject to the terms of the Merger Agreement, Landsea Holdings received $343.8 million of stock consideration, consisting of 32.6 million newly issued shares of LF Capital’s publicly-traded Class A common stock. The shares were valued at $10.56 per share for purposes of determining the aggregate number of shares payable to Landsea Holdings (the “Stock Consideration”). Upon Closing, Level Field Capital, LLC (the “Sponsor”) held 1.0 million shares that are subject to surrender and forfeiture for no consideration in the event the common stock does not reach certain thresholds during the 24-month period following the closing of the Merger (“Earnout Shares”). The Sponsor transferred 0.5 million Earnout Shares to Landsea Holdings. Additionally, the Sponsor forfeited 2.3 million private placement warrants and transferred 2.2 million private placement warrants to Landsea Holdings (such private placement warrants, each exercisable to purchase one share of Common Stock at an exercise price of $11.50 per share, are referred to as the “Private Placement Warrants”, and together with the Company’s public warrants, are referred to as the “Warrants”). In connection with the Merger, the Company received $64.4 million from the Merger after payments of $28.7 million related to the public warrant amendment and $7.5 million representing transaction expenses incurred. The Company incurred direct and incremental costs of approximately $16.7 million related to the equity issuance, consisting primarily of investment banking, legal, accounting and other professional fees, which were recorded to additional paid-in capital as a reduction of proceeds. The Company recorded $2.7 million in general and administrative expenses during the nine months ended September 30, 2021 related to the accelerated vesting of certain phantom awards. At the time of the Merger, the Company paid cash of $2.9 million for the phantom stock awards and issued 0.2 million shares with an issuance date value of $1.9 million. The Merger was accounted for as a reverse recapitalization. Under this method of accounting, LF Capital is treated as the “acquired” company for financial reporting purposes. This determination was primarily based on the current stockholder of LHC, Landsea Holdings, holding a relative majority of the voting power of the combined entity; the operations of LHI prior to the Merger comprising the only ongoing operations of the combined entity; and senior management of LHI comprising the senior management of the combined entity. Accordingly, for accounting purposes, the financial statements of the combined entity represent a continuation of the financial statements of LHI with the acquisition being treated as the equivalent of LHI issuing stock for the net assets of LF Capital, accompanied by a recapitalization. The net assets of LHI are stated at historical cost, with no goodwill or other intangible assets recorded. The shares and net income per share available to holders of the LHI’s common stock, prior to the Merger, have been retroactively restated as shares reflecting the exchange ratio established in the Merger Agreement. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation and Consolidation —The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company and all subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Landsea Holdings holds a series of notes payable to affiliated entities of its parent. The cash Landsea Holdings received from the notes payable was partially utilized to fund operations of the Company. Related party interest incurred by Landsea Holdings (the “Related Party Interest”) was historically pushed down to the Company and reflected on the consolidated balance sheets of the Company, primarily in real estate inventories, and on the consolidated statements of operations in cost of sales. Refer to Note 6 - Capitalized Interest for further detail. As the Company did not guarantee the notes payable nor have any obligations to repay the notes payable, and as the notes payable will not be assigned to the Company, the notes payable do not represent a liability of the Company and accordingly have not been reflected in the consolidated balance sheets. Additionally, in connection with the Merger, LHC is precluded from repaying Landsea Holdings' notes payable to the affiliated entities of its parent. Therefore, as of January 7, 2021, the Related Party Interest is no longer pushed down to LHC. The accompanying unaudited consolidated financial statements have been prepared in accordance with GAAP for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) and should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 16, 2022. The accompanying unaudited consolidated financial statements include all adjustments, consisting of normal recurring entries, necessary for a fair presentation of the Company’s results for the interim periods presented. Results for the interim periods are not necessarily indicative of the results to be expected for the full year due to seasonal variations and other factors. Use of Estimates —The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ materially from these estimates. Recent Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting. These changes are intended to simplify the market transition from the London Interbank Offered Rate (“LIBOR”) to alternative reference rates. ASU 2020-04 generally considers contract modifications related to reference rate reform to be an event that does not require contract remeasurement at the modification date nor a reassessment of a previous accounting determination. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope , which clarified the scope and application of ASU 2020-04. The guidance in ASU 2020-04 may be elected over time, through December 31, 2022, as reference rate reform activities occur. Once ASU 2020-04 is elected, the guidance must be applied prospectively for all eligible contract modifications. In June 2022, the Company modified its credit facility to use the Secured Overnight Financing Rate (“SOFR”) as a reference rate rather than LIBOR. The Company elected to apply this guidance which preserves the presentation of the loan consistent with the presentation prior to the modification. In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) , which provides clarity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. Particularly, the update states that an entity should treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as an exchange of the original instrument for a new instrument. The standard is effective for fiscal years beginning after December 15, 2021, with early adoption permitted. The adoption did not have a material impact on the Company's consolidated financial statements. In October 2021, the FASB issued ASU 2021-08, which requires application of Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers , to recognize and measure contract assets and liabilities from contracts with customers acquired in a business combination. ASU 2021-08 creates an exception to the general recognition and measurement principle in ASC 805, Business Combinations , and will result in recognition of contract assets and contract liabilities consistent with those recorded by the acquiree immediately before the acquisition date. The standard is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The adoption is not expected to have a material impact on the Company's consolidated financial statements. |
Business Combinations
Business Combinations | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations On January 18, 2022, the Company acquired 100% of Hanover Family Builders, LLC (“Hanover”), a Florida-based homebuilder, for an aggregate cash purchase price, net of working capital adjustments, of $262.6 million. The aggregate purchase price included a pay-off of $69.3 million related to debt held by Hanover and a payment of $15.6 million for land-related deposits. The total assets of Hanover included approximately 20 development projects and 3,800 lots in various stages of development. The determination of the final purchase accounting allocation related to the working capital calculations and resulting goodwill are in process as of the date the consolidated financial statements were issued. In accordance with ASC 805, the assets acquired and liabilities assumed from the acquisition of Hanover were measured and recognized at fair value as of the date of the acquisition to reflect the purchase price paid. Acquired inventories consist of land, land deposits, and work in process inventories. For acquired land and land options, the Company typically utilizes, with the assistance of a third-party appraiser, a sales comparison approach. For work in process inventories, the Company estimates the fair value based upon the stage of production of each unit and a gross margin that management believes a market participant would require to complete the remaining development and requisite selling efforts. On the acquisition date, the stage of production for each lot ranged from recently started lots to fully completed homes. The intangible asset acquired relates to the Hanover trade name, which is estimated to have a fair value of $1.6 million and is being amortized over one year. Goodwill represents the excess of the purchase price over the fair value of assets acquired and liabilities assumed and relates primarily to the assembled workforce and business synergies. Goodwill of $44.2 million was preliminarily recorded on the consolidated balance sheets as a result of this transaction and is expected to be deductible for tax purposes over 15 years. The acquired goodwill is included in the Florida reporting segment in Note 12, Segment Reporting . The Company incurred transaction related costs of less than $0.1 million and $0.7 million related to the Hanover acquisition during the three and nine months ended September 30, 2022, respectively. The Company's results of operations include homebuilding revenues from the Hanover acquisition of $72.2 million and $231.5 million for the three and nine months ended September 30, 2022, respectively. The accompanying results of operations also include pretax income of $4.5 million and $8.6 million from the Hanover acquisition during the three and nine months ended September 30, 2022. respectively. The pretax income is inclusive of purchase price accounting and an allocation of corporate general and administrative expenses. The following is a summary of the allocation of the purchase price based on the fair value of assets acquired and liabilities assumed (dollars in thousands) . Assets Acquired Cash $ 3,857 Real estate inventories 232,071 Goodwill 44,182 Trade name 1,590 Other assets 378 Total assets $ 282,078 Liabilities Assumed Accounts payable $ 6,329 Accrued expenses 13,165 Total liabilities 19,494 Net assets acquired $ 262,584 On May 4, 2021, the Company acquired 100% of Mercedes Premier Homes, LLC (also known as Vintage Estate Homes, LLC, or “Vintage”), a Florida- and Texas-based homebuilder, for cash consideration of approximately $54.6 million. In addition, the Company assumed $32.1 million of debt, of which it paid down $3.8 million in connection with the acquisition. Total assets included approximately 20 development projects and 1,800 lots in various stages of development. The intangible asset acquired relates to the Vintage trade name, which was estimated to have a fair value of $1.6 million and was amortized over one year. Goodwill of $3.8 million was recorded on the consolidated balance sheets as a result of this transaction and is expected to be deductible for tax purposes over 15 years. The acquired goodwill is included in the Florida reporting segment. The Company incurred transaction costs of $0.3 million and $0.8 million related to the Vintage acquisition during the three and nine months ended September 30, 2021. The following is a summary of the allocation of the purchase price based on the fair value of assets acquired and liabilities assumed (dollars in thousands) . Assets Acquired Cash $ 10,063 Real estate inventories 93,699 Goodwill 3,752 Trade name 1,550 Other assets 3,956 Total assets $ 113,020 Liabilities Assumed Accounts payable $ 1,641 Accrued expenses 24,660 Notes payable 32,119 Total liabilities 58,420 Net assets acquired $ 54,600 Unaudited Pro Forma Financial Information Unaudited pro forma revenue and net income (loss) for the following periods presented give effect to the results of the acquisitions of Hanover and Vintage as though the respective acquisition dates were as of January 1, 2021 and January 1, 2020, the beginning of the year preceding the respective acquisitions. Unaudited pro forma net income (loss) adjusts the operating results of Hanover and Vintage to reflect the additional costs that would have been recorded assuming the fair value adjustments had been applied as of the beginning of the year preceding the year of acquisition including the tax-effected amortization of the acquired trade name and transaction related costs. Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) Revenue $ 335,585 $ 266,786 $ 1,025,600 $ 818,382 Pretax income (loss) 35,935 1,586 108,188 (22,298) Provision (benefit) for income taxes 4,858 (3,811) 28,339 (4,025) Net income (loss) $ 31,077 $ 5,397 $ 79,849 $ (18,273) |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities The Company consolidates two joint venture (“JV”) variable interest entities (“VIEs”). The consolidated VIEs include one active project in the Metro New York area (“14th Ave JV”) and one JV with the purpose of acquiring undeveloped land (the “LCF JV”). The Company has determined that it is the primary beneficiary of these VIEs as it has the power to direct activities of the operations that most significantly affect their economic performance. Both consolidated VIEs are financed by equity contributions from the Company and the JV partner. The 14th Ave JV was also funded by third-party debt which was paid off in April 2022 with proceeds from a loan provided by the Company. The intercompany loan is eliminated upon consolidation. The following table summarizes the carrying amount and classification of the VIEs’ assets and liabilities in the consolidated balances sheets as of September 30, 2022 and December 31, 2021. September 30, 2022 December 31, 2021 (dollars in thousands) Cash $ 4,960 $ 130 Cash held in escrow 11 — Restricted cash — 443 Real estate inventories 113,109 121,040 Due from affiliates 317 — Other assets 4,185 195 Total assets $ 122,582 $ 121,808 Accounts payable $ 1,596 $ 1,779 Accrued expenses and other liabilities 5,484 1,400 Due to affiliates — 226 Notes payable, net — 81,584 Total liabilities $ 7,080 $ 84,989 |
Real Estate Inventories
Real Estate Inventories | 9 Months Ended |
Sep. 30, 2022 | |
Real Estate Inventories [Abstract] | |
Real Estate Inventories | Real Estate Inventories Real estate inventories are summarized as follows: September 30, 2022 December 31, 2021 (dollars in thousands) Deposits and pre-acquisition costs $ 98,764 $ 65,724 Land held and land under development 216,945 243,310 Homes completed or under construction 846,291 526,950 Model homes 17,418 8,808 Total real estate inventories $ 1,179,418 $ 844,792 Deposits and pre-acquisition costs include land deposits and other due diligence costs related to potential land acquisitions. Land held and land under development includes costs incurred during site development such as development, indirect costs, and permits. Homes completed or under construction and model homes include all costs associated with home construction, including land, development, indirect costs, permits, materials, and labor. In accordance with ASC 360, Property, Plant, and Equipment, real estate inventories are stated at cost, unless the carrying amount is determined not to be recoverable, in which case inventory is written down to its fair value. The Company reviews each real estate asset at the community-level, on a quarterly basis, or whenever indicators of impairment exist. We generally determine the estimated fair value of each community by using a discounted cash flow approach based on the estimated future cash flows at discount rates that reflect the risk of the community being evaluated. The discounted cash flow approach can be impacted significantly by the Company’s estimates of future home sales revenue, home construction costs, pace of homes sales, and the applicable discount rate, all of which are Level 3 inputs. |
Capitalized Interest
Capitalized Interest | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Capitalized Interest | Capitalized Interest Interest is capitalized to real estate inventories and investment in unconsolidated joint ventures during development and as a result of other qualifying activities. Interest capitalized as a cost of real estate inventories is included in cost of sales as related inventories are delivered. Interest capitalized to investments in unconsolidated JVs is relieved to equity in net income of unconsolidated joint ventures as related joint venture homes close. For the periods reported, interest incurred, capitalized, and expensed was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) (dollars in thousands) Related party interest incurred $ 74 $ 183 $ 231 $ 183 Other interest incurred 13,759 6,597 28,352 18,701 Total interest incurred 13,833 6,780 28,583 18,884 Related party interest capitalized 74 183 231 183 Other interest capitalized 13,759 6,597 28,352 18,701 Total interest capitalized 13,833 6,780 28,583 18,884 Previously capitalized related party interest included in cost of sales $ 714 $ 2,571 $ 3,831 $ 9,813 Previously capitalized other interest included in cost of sales 9,436 4,711 27,445 15,835 Related party interest relieved to equity in income from unconsolidated joint ventures — 278 69 1,042 Other interest relieved to equity in income from unconsolidated joint ventures — 3 1 14 Other interest expensed — 11 — 32 Total interest expense included in pretax income $ 10,150 $ 7,574 $ 31,346 $ 26,736 |
Other Assets
Other Assets | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | Other AssetsAs of September 30, 2022 and December 31, 2021, the Company had contract assets of $16.6 million and $6.1 million, respectively, related to lot sales and other revenue. The contract asset balance is included in other assets on the Company’s consolidated balance sheets and represents cash to be received for work already performed on lot sales and other contracts. The amount of the transaction price for lot sales and other contracts remaining to be recognized as revenue for performance obligations that were not fully satisfied as of September 30, 2022 and December 31, 2021 was $20.6 million and $63.9 million, respectively. As of September 30, 2022 and December 31, 2021, the Company had $0.4 million and $4.0 million of deferred revenue, respectively, related to lot sales and other revenue included in accrued expenses and other liabilities in the Company’s consolidated balance sheets. The Company reduces these liabilities and recognizes revenue as development progresses and the related performance obligations are completed. The Company recognized $0.0 million and $4.0 million of lot sales and other revenue during the three and nine months ended September 30, 2022, respectively, related to the deferred revenue balance as of December 31, 2021. |
Notes and Other Debts Payable,
Notes and Other Debts Payable, net | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Notes and Other Debts Payable, net | Notes and Other Debts Payable, net Amounts outstanding under notes and other debts payable, net consist of the following: September 30, 2022 December 31, 2021 (dollars in thousands) Construction loan $ — $ 82,617 Line of credit facilities 594,300 390,300 Notes payable 594,300 472,917 Deferred loan costs (9,235) (11,800) Notes and other debts payable, net $ 585,065 $ 461,117 In October 2021, the Company entered into a line of credit agreement (the “Credit Agreement”). The Credit Agreement provides for a senior unsecured borrowing of up to $675.0 million as of September 30, 2022. The Company may increase the borrowing amount up to $850.0 million, under certain conditions. Borrowings under the Credit Agreement bear interest at SOFR plus 3.35% or Prime Rate (as defined in the Credit Agreement) plus 2.75%. The interest rate includes a floor of 3.85%. As of September 30, 2022, the interest rate on the loan was 5.95%. The Credit Agreement was modified in June 2022 to increase the borrowing commitment by $70.0 million to $655.0 million and replace LIBOR with SOFR as an index rate. The Credit Agreement was modified again in September 2022 to increase the commitment by an additional $20.0 million to $675.0 million. The Credit Agreement matures in October 2024. In addition, the Company previously had one project-specific construction loan. In April 2022, the construction loan was repaid in full with proceeds from borrowings under the Credit Agreement. In connection with this payoff, the Company incurred $2.5 million of debt extinguishment fees which are included in other income, net, in the consolidated statements of operations. The Company received a Paycheck Protection Program (“PPP”) loan during the second quarter of 2020 in the amount of $4.3 million, and received a notice of forgiveness of the PPP loan in June 2021. The forgiveness was recorded as other income in the consolidated statements of operations of the Company. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal —The Company is currently involved in various legal actions and proceedings that arise from time to time and may be subject to similar or other legal and/or regulatory actions in the future. The Company is currently unable to estimate the likelihood of an unfavorable result in any such proceeding that could have a material adverse effect on the Company’s results of operations, financial position, or liquidity. In the fourth quarter of 2021, certain insurers paid $14.9 million on behalf of the Company and others to settle a wrongful death suit. The insurers contend they are entitled to seek reimbursement from the Company for some or all of such amounts, which the Company disputes. At this time the Company is unable to estimate the amount or outcome of the insurers’ claims against the Company. In addition, the Company is unable to estimate the amount or outcome of its recovery actions against relevant third parties. Performance Obligations —In the ordinary course of business, and as part of the entitlement and development process, the Company’s subsidiaries are required to provide performance bonds to assure completion of certain public facilities. The Company had $117.0 million and $94.7 million of performance bonds outstanding as of September 30, 2022 and December 31, 2021, respectively. Warranty —Estimated future direct warranty costs are accrued and charged to cost of sales in the period when the related homebuilding revenues are recognized. Changes in the Company’s warranty accrual are detailed in the table below: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) Beginning warranty accrual $ 18,010 $ 13,595 $ 15,692 $ 11,730 Warranty provision 1,359 1,107 4,602 3,972 Warranty payments (1,118) (436) (2,043) (1,436) Ending warranty accrual $ 18,251 $ 14,266 $ 18,251 $ 14,266 Operating Leases —The Company primarily enters into operating leases for the right to use office space, model homes, and computer and office equipment, which have remaining lease terms that range from 1 to 8 years and often include one or more options to renew. During December 2021, the Company sold model homes and immediately leased back these models for up to two years. Certain of these model homes were not complete at the time of sale. All of the leases from the sale-leasebacks are accounted for as operating leases and are reflected as part of the Company’s right-of-use assets and lease liabilities in the accompanying consolidated balance sheets. Certain of these sales were to a related party; refer to Note 10 - Related Party Transactions for further detail. The weighted average remaining lease term as of September 30, 2022 and December 31, 2021 was 4.6 and 4.1 years, respectively. Renewal terms are included in the lease term when it is reasonably certain the option will be exercised. The Company established a right-of-use asset and a lease liability based on the present value of future minimum lease payments at the commencement date of the lease, or, if subsequently modified, the date of modification for active leases. As the rate implicit in each lease is not readily determinable, the Company’s incremental borrowing rate is used in determining the present value of future minimum payments as of the commencement date. The weighted average rate as of September 30, 2022 was 3.8%. Lease components and non-lease components are accounted for as a single lease component. As of September 30, 2022, the Company had $12.8 million and $13.6 million recognized as a right-of-use asset and lease liability, respectively, which are presented on the consolidated balance sheets within other assets and accrued expenses and other liabilities, respectively. As of December 31, 2021, the Company had $12.6 million and $13.2 million recognized as a right-of-use asset and lease liability, respectively. Operating lease expense for the three and nine months ended September 30, 2022 was $0.5 million and $1.6 million, and is included in general and administrative expenses on the consolidated statements of operations. For the three and nine months ended September 30, 2021 operating lease expense was $0.5 million and $1.3 million, respectively. Future minimum payments under the noncancelable operating leases in effect at September 30, 2022 were as follows (dollars in thousands) : 2022 $ 1,194 2023 4,101 2024 2,988 2025 2,043 2026 1,765 Thereafter 2,808 Total lease payments 14,899 Less: Discount (1,274) Present value of lease liabilities $ 13,625 |
Commitments and Contingencies | Commitments and Contingencies Legal —The Company is currently involved in various legal actions and proceedings that arise from time to time and may be subject to similar or other legal and/or regulatory actions in the future. The Company is currently unable to estimate the likelihood of an unfavorable result in any such proceeding that could have a material adverse effect on the Company’s results of operations, financial position, or liquidity. In the fourth quarter of 2021, certain insurers paid $14.9 million on behalf of the Company and others to settle a wrongful death suit. The insurers contend they are entitled to seek reimbursement from the Company for some or all of such amounts, which the Company disputes. At this time the Company is unable to estimate the amount or outcome of the insurers’ claims against the Company. In addition, the Company is unable to estimate the amount or outcome of its recovery actions against relevant third parties. Performance Obligations —In the ordinary course of business, and as part of the entitlement and development process, the Company’s subsidiaries are required to provide performance bonds to assure completion of certain public facilities. The Company had $117.0 million and $94.7 million of performance bonds outstanding as of September 30, 2022 and December 31, 2021, respectively. Warranty —Estimated future direct warranty costs are accrued and charged to cost of sales in the period when the related homebuilding revenues are recognized. Changes in the Company’s warranty accrual are detailed in the table below: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) Beginning warranty accrual $ 18,010 $ 13,595 $ 15,692 $ 11,730 Warranty provision 1,359 1,107 4,602 3,972 Warranty payments (1,118) (436) (2,043) (1,436) Ending warranty accrual $ 18,251 $ 14,266 $ 18,251 $ 14,266 Operating Leases —The Company primarily enters into operating leases for the right to use office space, model homes, and computer and office equipment, which have remaining lease terms that range from 1 to 8 years and often include one or more options to renew. During December 2021, the Company sold model homes and immediately leased back these models for up to two years. Certain of these model homes were not complete at the time of sale. All of the leases from the sale-leasebacks are accounted for as operating leases and are reflected as part of the Company’s right-of-use assets and lease liabilities in the accompanying consolidated balance sheets. Certain of these sales were to a related party; refer to Note 10 - Related Party Transactions for further detail. The weighted average remaining lease term as of September 30, 2022 and December 31, 2021 was 4.6 and 4.1 years, respectively. Renewal terms are included in the lease term when it is reasonably certain the option will be exercised. The Company established a right-of-use asset and a lease liability based on the present value of future minimum lease payments at the commencement date of the lease, or, if subsequently modified, the date of modification for active leases. As the rate implicit in each lease is not readily determinable, the Company’s incremental borrowing rate is used in determining the present value of future minimum payments as of the commencement date. The weighted average rate as of September 30, 2022 was 3.8%. Lease components and non-lease components are accounted for as a single lease component. As of September 30, 2022, the Company had $12.8 million and $13.6 million recognized as a right-of-use asset and lease liability, respectively, which are presented on the consolidated balance sheets within other assets and accrued expenses and other liabilities, respectively. As of December 31, 2021, the Company had $12.6 million and $13.2 million recognized as a right-of-use asset and lease liability, respectively. Operating lease expense for the three and nine months ended September 30, 2022 was $0.5 million and $1.6 million, and is included in general and administrative expenses on the consolidated statements of operations. For the three and nine months ended September 30, 2021 operating lease expense was $0.5 million and $1.3 million, respectively. Future minimum payments under the noncancelable operating leases in effect at September 30, 2022 were as follows (dollars in thousands) : 2022 $ 1,194 2023 4,101 2024 2,988 2025 2,043 2026 1,765 Thereafter 2,808 Total lease payments 14,899 Less: Discount (1,274) Present value of lease liabilities $ 13,625 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Following the Merger, the Company continues to pay for certain costs on behalf of its former parent and current majority shareholder while the two companies’ respective processes are separated. The Company records a due from affiliate balance for all such payments. As of September 30, 2022 and December 31, 2021, the Company had a net receivable due from affiliates balance of $2.8 million and $2.1 million, respectively. In June 2022, the Company entered into two transactions with its majority shareholder, Landsea Holdings. On June 1, 2022, the Board of Directors authorized the Company to buyback 4.4 million shares of common stock held by Landsea Holdings. The Company paid $30.0 million at a price of $6.82 per share, a discount of 5% compared to the closing price on May 31, 2022 of $7.18. Additionally, the Company repurchased all 5.5 million outstanding Private Placement Warrants, of which Landsea Holdings held 2.2 million. The Company paid Landsea Holdings $6.6 million at $3.00 per Private Placement Warrant. In addition, 2.8 million of the repurchased Private Placement Warrants were held by Level Field Capital, LLC, a related party that is controlled by a member of the Company’s Board of Directors. The Company paid Level Field Capital, LLC $8.4 million at $3.00 per Private Placement Warrant. The Company’s common stock and Warrants are discussed further in Note 15 – Stockholders’ Equity . In June 2022, Landsea Capital Fund, who is under common control with the Company, contributed $55.0 million to the LCF JV. The LCF JV, which is consolidated by the Company, used these proceeds to purchase undeveloped land from the Company. The Company distributed $3.1 million to Landsea Capital Fund during the three and nine months ended September 30, 2022. All intercompany transactions between the Company and the LCF JV have been eliminated upon consolidation. In December 2021, the Company sold model homes to a related party for total consideration of $15.2 million. Construction of certain of these model homes was not complete at the time of sale. The Company recognized lot sales and other revenue of $1.2 million during the nine months ended September 30, 2022 related to the model homes still under construction on the sale date. Corresponding lot and other cost of sales of $1.3 million was also recognized during the same period. The Company did not recognize any revenue or other cost of sales related to these model homes during the three months ended September 30, 2022. All other model homes sold were completed homes and the revenue was fully recognized in home sales revenue at the time of sale. As part of this transaction, the Company leased back these models. The total amount of rent payments made during the three and nine months ended September 30, 2022 is $0.2 million and $0.6 million, respectively. The right-of-use asset and lease liability balances associated with these leases is $1.5 million and $1.5 million, respectively, as of September 30, 2022 and $2.0 million and $2.0 million, respectively, as of December 31, 2021. In July 2021, the Company entered into a landbank agreement for a project in its California segment with a related party. The Company will make regular payments to the related party based on an annualized rate of 7% of the undeveloped land costs while the land is developed and may purchase, at the Company’s discretion, the lots at a predetermined price of $28.9 million. The total amount of interest payments made during the three and nine months ended September 30, 2022 is $0.2 million and $0.8 million, respectively. During the three and nine months ended September 30, 2022 payments of $1.7 million and $7.9 million, including fees, have been made to purchase developed lots from the related party, respectively. In connection with the Merger in January 2021, the Company transferred a deferred tax asset (“DTA”) to Landsea Holdings, its majority shareholder, of $12.1 million. The DTA represented the deferred tax on interest, expensed through Cost of Sales, from a related party loan that remained with Landsea Holdings after the Merger. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Th e effective tax rate of the Company was 15.9% and 26.2% for the three and nine months ended September 30, 2022, respectively, with an effective tax rate of 21.6% and 18.1% for the three and nine months ended September 30, 2021, respectively. The difference between the statutory tax rate and the effective tax rate for the nine months ended September 30, 2022 is primarily related to state income taxes net of federal income tax benefits, estimated deduction limitations for executive compensation, warrant fair market value adjustments, and tax credits for energy efficient homes. The difference between the statutory tax rate and the effective tax rate for the nine months ended September 30, 2021 is primarily related to state income taxes net of federal income tax benefits, estimated deduction limitations for executive compensation, warrant fair market value adjustments, the gain on forgiveness of the PPP loan, and tax credits for energy efficient homes. The accounting for deferred taxes is based upon estimates of future results. Differences between the anticipated and actual outcomes of these future results could have a material impact on the Company’s consolidated results of operations or financial position. Also, changes in existing federal and state tax laws and tax rates could affect future tax results and the valuation of the Company’s deferred tax assets. The Inflation Reduction Act (“IRA”) of 2022 was enacted into law on August 16, 2022. The IRA introduces a 15% corporate alternative minimum tax on average annual adjusted financial statement income for applicable corporations, and a 1% excise tax on stock repurchases made by publicly traded US corporations after December 31, 2022. The IRA also retroactively extends the federal tax credit for building new energy efficient homes for homes delivered from January 1, 2022 through December 31, 2032. The federal energy tax credits were recognized in the three and nine months ended September 30, 2022. The Company is currently evaluating the other potential effects of the IRA on its consolidated financial statements. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting The Company is engaged in the acquisition, development, and sale of homes and lots in multiple states across the country. The Company is managed by geographic location and each of the five geographic regions targets a wide range of buyer profiles including: first time, move-up, and luxury homebuyers. Management of the five geographic regions report to the Company's chief operating decision makers (“CODMs”), the Chief Executive Officer and Chief Operating Officer of the Company. The CODMs review the results of operations, including total revenues and pretax income to assess profitability and to allocate resources. Accordingly, the Company has presented its operations as the following five reportable segments: • Arizona • California • Florida • Metro New York • Texas The Company has also identified its Corporate operations as a non-operating segment, as they serve to support the homebuilding operations through functional departments such as executive, finance, treasury, human resources, accounting, and legal. The majority of Corporate personnel and resources are primarily dedicated to activities relating to operations and are allocated based on each segment's respective percentage of assets, revenue, and dedicated personnel. The following table summarizes total revenues and pretax income before income tax expense by segment: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) Revenue Arizona $ 76,808 $ 65,502 $ 234,927 $ 202,750 California 118,977 110,046 343,466 346,680 Florida 103,564 31,161 320,358 59,519 Metro New York 28,132 — 95,758 — Texas 8,104 7,420 25,982 15,873 Total revenues $ 335,585 $ 214,129 $ 1,020,491 $ 624,822 Pretax income Arizona $ 6,046 $ 5,103 $ 17,653 $ 10,371 California 20,059 7,965 68,085 22,706 Florida 4,172 147 8,028 1,032 Metro New York (810) (622) 646 (1,592) Texas (215) (209) (93) 186 Corporate (3,950) 1,375 (27,663) (15,197) Total pretax income $ 25,302 $ 13,759 $ 66,656 $ 17,506 The following table summarizes total assets by segment: September 30, 2022 December 31, 2021 (dollars in thousands) Assets Arizona $ 375,874 $ 360,598 California 513,967 400,292 Florida 431,851 102,158 Metro New York 60,789 124,962 Texas 39,070 35,984 Corporate 47,307 241,520 Total assets $ 1,468,858 $ 1,265,514 As of September 30, 2022, goodwill of $20.7 million and $47.9 million was allocated to the Arizona and Florida segments, respectively. As of December 31, 2021, goodwill of $20.7 million and $3.8 million was allocated to the Arizona and Florida segments, respectively. |
Fair Value
Fair Value | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value ASC 820, Fair Value Measurement , defines fair value as the price that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and requires assets and liabilities carried at fair value to be classified and disclosed in the following three categories: Level 1 — Quoted prices for identical instruments in active markets. Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are inactive; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets at measurement date. Level 3 — Valuations derived from techniques where one or more significant inputs or significant value drivers are unobservable in active markets at measurement date. The following table presents carrying values and estimated fair values of financial instruments: September 30, 2022 December 31, 2021 Hierarchy Carrying Value Fair Value Carrying Value Fair Value (dollars in thousands) Liabilities: Construction loan (1)(2) Level 2 $ — $ — $ 82,617 $ 82,617 Line of credit facilities (1) Level 2 $ 594,300 $ 594,300 $ 390,300 $ 390,300 Warrant liability Level 3 $ — $ — $ 9,185 $ 9,185 (1) Carrying amount approximates fair value due to the variable interest rate terms of these loans. Carrying value excludes any associated deferred loan costs. (2) In April 2022, the remaining construction loan was repaid in full. The carrying values of restricted cash, receivables, deposits, and other assets as well as accounts payable and accrued liabilities approximate the fair value for these financial instruments based upon an evaluation of the underlying characteristics and market data because of the short period of time between origination of the instruments and their expected realization. The fair value of cash and cash equivalents is classified in Level 1 of the fair value hierarchy. Non-financial assets such as real estate inventories are measured at fair value on a non-recurring basis using a discounted cash flow approach with Level 3 inputs within the fair value hierarchy. This measurement is performed when events and circumstances indicate the asset’s carrying value is not fully recoverable. Prior to being purchased by the Company in June 2022, the Private Placement Warrants were historically measured at fair value on a recurring basis using a Black-Scholes option pricing model. The significant unobservable input as of September 30, 2021 was the volatility rate implied from the Company’s public warrants, which are exchanged on an open market, of 48.0%. The following table reconciles the beginning and ending balances for the Level 3 recurring fair value measurements during the periods presented: Nine Months Ended September 30, 2022 2021 Warrant liability (dollars in thousands) Beginning balance (1) $ 9,185 $ 11,275 Changes in fair value 7,315 3,245 Repurchases of warrants (16,500) — Ending balance $ — $ 14,520 (1) The beginning balance for the period ended September 30, 2021 represents the balance as of January 7, 2021, the Closing Date of the Merger. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation During 2018, Landsea Holdings created a long-term incentive compensation program designed to align the interests of Landsea Holdings, the Company, and its executives by enabling key employees to participate in the Company’s future growth through the issuance of phantom equity awards. Landsea Holdings’ phantom equity awards issued on or after January 1, 2018 were accounted for pursuant to ASC 710, Compensation , as the value was not based on the shares of comparable public entities or other equity but was instead based on the book value of Landsea Holdings’' equity. Landsea Holdings measured the value of the phantom equity awards on a quarterly basis using the intrinsic value method and pushed down the expense to the Company since the employees who participated in the long-term incentive compensation program primarily benefited the Company. In connection with the Merger all of the phantom equity awards vested and were either paid out in cash or were converted to stock of LHC and the program was terminated. The Company recorded $2.7 million in general and administrative expenses in the three months ended March 31, 2021 related to the accelerated vesting of the phantom awards. The Company paid cash of $2.9 million for the phantom stock awards and granted 0.2 million shares with a grant date value of $1.9 million at the time of the Merger. The following table presents a summary of the Company’s nonvested PSUs and RSUs for the nine months ended September 30, 2022: Awards Weighted Average Grant Date Fair Value (in thousands) Nonvested, at December 31, 2021 768 $ 9.43 Granted 1,136 8.48 Vested (278) 9.19 Forfeited — — Nonvested, at September 30, 2022 1,626 $ 8.82 The following table presents a summary of the Company’s stock options activity for the nine months ended September 30, 2022: Number of Shares Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (in thousands) (in years) (in thousands) Options outstanding at December 31, 2021 — $ — Granted 744 8.82 Exercised — — Forfeited (60) 8.83 Options outstanding at September 30, 2022 (1) 684 $ 8.82 9.46 $ — Options exercisable at September 30, 2022 — $ — — $ — (1) As of September 30, 2022, the stock options were out-of-the-money, as the exercise price of the stock options exceeded the average market price of the Company’s common stock. Stock-based compensation expense totaled $0.9 million and $2.8 million during the three and nine months ended September 30, 2022, respectively, and is included in general and administrative expenses on the consolidated statements of operations. For the three and nine months ended September 30, 2021, stock-based compensation expense was $1.2 million and $4.1 million, respectively. The following table presents a summary of the Company’s outstanding RSUs and PSUs, assuming the current estimated level of performance achievement (in thousands, except years): September 30, 2022 (in thousands, except period) Unvested units 1,626 Remaining cost on unvested units $ 4,415 Remaining vesting period 4.25 years Stock-based compensation expense associated with the outstanding RSUs and PSUs is measured using the grant date fair value. The expense associated with the PSUs also incorporates the estimated achievement of the established performance criteria at the end of each reporting period until the performance period ends. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity The Company’s authorized capital stock consists of 500.0 million shares of common stock with a par value of $0.0001 per share, and 50.0 million shares of preferred stock with a par value of $0.0001 per share. As of September 30, 2022, there were 42.1 million shares of common stock issued and 41.0 million outstanding, and no shares of preferred stock issued or outstanding. On January 7, 2021, the Merger was consummated pursuant to the Merger Agreement. Prior to the Merger, LF Capital was authorized to issue, and had outstanding, two classes of common stock, Class A common stock and Class B common stock. Upon the consummation of the Merger, all issued and outstanding shares of Class B common stock converted to shares of Class A common stock. Public stockholders were offered the opportunity to redeem, upon closing of the Merger, shares of Class A common stock for cash. All outstanding shares of common stock are validly issued, fully paid and nonassessable. Following the Merger, the Company’s equity was retroactively adjusted to reflect the 32.6 million shares of common stock issued to Landsea Holdings. In January 2022, the Board of Directors authorized a stock repurchase program. The program allowed for the repurchase of up to $10.0 million worth of common stock, inclusive of associated fees, so long as the purchase price per share did not exceed $15.00 per share. The authorization to effect stock repurchases expired on June 30, 2022, with no remaining capacity to repurchase common stock. During the six months ended June 30, 2022, the Company repurchased 1,160,751 shares of common stock for a total of $10.0 million, which was recorded as a reduction to additional paid-in capital. In April 2022, the Board of Directors authorized an extension of the stock repurchase program for the repurchase and an additional $10.0 million of capacity to repurchase common stock, which expires December 31, 2022. As of September 30, 2022, no shares had been repurchased under this authorization. In May 2022, the Board of Directors authorized a repurchase of 4,398,826 shares of common stock directly from the Company’s majority shareholder for $30.0 million, or a price of $6.82 per share. The Company consummated this repurchase and retired the shares in June 2022. As of September 30, 2022 there were 15,525,000 outstanding Warrants, consisting entirely of public warrants. At the time of the Merger, the Warrant Agreement was amended so that each public warrant is exercisable at $1.15 into one tenth of a share of common stock. As part of the amendment, each holder of the public warrants received $1.85 per warrant for a total of $28.7 million paid by the Company upon closing of the Merger. The Warrants will expire five years after the completion of the Merger or earlier upon redemption or liquidation. The Company may call the public warrants for redemption: • in whole and not in part; • at a price of $0.01 per warrant; • upon a minimum of 30 days’ prior written notice of redemption; and • if, and only if, the last reported closing price of the shares equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders. If the Company calls the public warrants for redemption, management will have the option to require all holders that wish to exercise the public warrants to do so on a “cashless basis,” as described in the Warrant Agreement. The exercise price and number of common shares issuable upon exercise of the Warrants may be adjusted in certain circumstances including in the event of a share dividend, or recapitalization, reorganization, merger or consolidation. However, the Warrants will not be adjusted for issuance of common shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Warrants shares. Accordingly, the Warrants may expire worthless. In June 2022, the Company repurchased all 5.5 million outstanding Private Placement Warrants, which were exercisable at $11.50 into one share of common stock. The Company paid $16.5 million, or $3.00 per warrant, to repurchase all of the outstanding Private Placement Warrants. This amount included $6.6 million for the repurchase of 2.2 million of the Private Placement Warrants that were held by the Company’s majority shareholder, Landsea Holdings, and $8.4 million to Level Field Capital, LLC, a related party, for the repurchase of 2.8 million Private Placement Warrants. Refer to Note 10 - Related Party Transactions for additional information. The loss recognized on the repurchase of the Private Placement Warrants is recorded as loss on remeasurement of warrant liability on the Company’s consolidated statements of operations. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share (“EPS”) for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands, except share and per share amounts) Numerator Net income attributable to Landsea Homes Corporation $ 19,970 $ 10,797 $ 47,970 $ 14,387 Less: undistributed earnings allocated to participating shares (487) (239) (1,094) (315) Net income attributable to common stockholders $ 19,483 $ 10,558 $ 46,876 $ 14,072 Denominator Weighted average common shares outstanding - basic 40,935,152 46,281,091 43,768,269 46,062,200 Adjustment for weighted average participating shares outstanding (1,000,000) (1,000,000) (1,000,000) (985,185) Adjusted weighted average common shares outstanding under two class method - basic 39,935,152 45,281,091 42,768,269 45,077,015 Dilutive effect of warrants — — — — Dilutive effect of share-based awards 162,117 48,800 175,602 69,537 Adjusted weighted average common shares outstanding under two class method - diluted 40,097,269 45,329,891 42,943,871 45,146,552 Earnings per share Basic $ 0.49 $ 0.23 $ 1.10 $ 0.31 Diluted $ 0.49 $ 0.23 $ 1.09 $ 0.31 |
Supplemental Disclosures of Cas
Supplemental Disclosures of Cash Flow Information | 9 Months Ended |
Sep. 30, 2022 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosures of Cash Flow Information | Supplemental Disclosures of Cash Flow Information The following table presents certain supplemental cash flow information: Nine Months Ended September 30, 2022 2021 (dollars in thousands) Supplemental disclosures of cash flow information Interest paid, net of amounts capitalized $ — $ 32 Income taxes paid $ 32,454 $ 5,905 Supplemental disclosures of non-cash investing and financing activities Right-of-use assets obtained in exchange for operating lease liabilities for new or modified operating leases $ 3,660 $ — Transfer of deferred tax asset to Landsea Holdings $ — $ 12,119 Conversion of deferred offering costs to additional paid-in-capital $ — $ 9,229 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of Presentation and Consolidation —The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) |
Principles of Consolidation | Landsea Holdings holds a series of notes payable to affiliated entities of its parent. The cash Landsea Holdings received from the notes payable was partially utilized to fund operations of the Company. Related party interest incurred by Landsea Holdings (the “Related Party Interest”) was historically pushed down to the Company and reflected on the consolidated balance sheets of the Company, primarily in real estate inventories, and on the consolidated statements of operations in cost of sales. Refer to Note 6 - Capitalized Interest for further detail. As the Company did not guarantee the notes payable nor have any obligations to repay the notes payable, and as the notes payable will not be assigned to the Company, the notes payable do not represent a liability of the Company and accordingly have not been reflected in the consolidated balance sheets. Additionally, in connection with the Merger, LHC is precluded from repaying Landsea Holdings' notes payable to the affiliated entities of its parent. Therefore, as of January 7, 2021, the Related Party Interest is no longer pushed down to LHC. |
Use of Estimates | Use of Estimates—The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ materially from these estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting. These changes are intended to simplify the market transition from the London Interbank Offered Rate (“LIBOR”) to alternative reference rates. ASU 2020-04 generally considers contract modifications related to reference rate reform to be an event that does not require contract remeasurement at the modification date nor a reassessment of a previous accounting determination. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope , which clarified the scope and application of ASU 2020-04. The guidance in ASU 2020-04 may be elected over time, through December 31, 2022, as reference rate reform activities occur. Once ASU 2020-04 is elected, the guidance must be applied prospectively for all eligible contract modifications. In June 2022, the Company modified its credit facility to use the Secured Overnight Financing Rate (“SOFR”) as a reference rate rather than LIBOR. The Company elected to apply this guidance which preserves the presentation of the loan consistent with the presentation prior to the modification. In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) , which provides clarity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. Particularly, the update states that an entity should treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as an exchange of the original instrument for a new instrument. The standard is effective for fiscal years beginning after December 15, 2021, with early adoption permitted. The adoption did not have a material impact on the Company's consolidated financial statements. In October 2021, the FASB issued ASU 2021-08, which requires application of Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers , to recognize and measure contract assets and liabilities from contracts with customers acquired in a business combination. ASU 2021-08 creates an exception to the general recognition and measurement principle in ASC 805, Business Combinations , and will result in recognition of contract assets and contract liabilities consistent with those recorded by the acquiree immediately before the acquisition date. The standard is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The adoption is not expected to have a material impact on the Company's consolidated financial statements. |
Business Combinations (Tables)
Business Combinations (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following is a summary of the allocation of the purchase price based on the fair value of assets acquired and liabilities assumed (dollars in thousands) . Assets Acquired Cash $ 3,857 Real estate inventories 232,071 Goodwill 44,182 Trade name 1,590 Other assets 378 Total assets $ 282,078 Liabilities Assumed Accounts payable $ 6,329 Accrued expenses 13,165 Total liabilities 19,494 Net assets acquired $ 262,584 The following is a summary of the allocation of the purchase price based on the fair value of assets acquired and liabilities assumed (dollars in thousands) . Assets Acquired Cash $ 10,063 Real estate inventories 93,699 Goodwill 3,752 Trade name 1,550 Other assets 3,956 Total assets $ 113,020 Liabilities Assumed Accounts payable $ 1,641 Accrued expenses 24,660 Notes payable 32,119 Total liabilities 58,420 Net assets acquired $ 54,600 |
Business Acquisition, Pro Forma Information | Unaudited pro forma net income (loss) adjusts the operating results of Hanover and Vintage to reflect the additional costs that would have been recorded assuming the fair value adjustments had been applied as of the beginning of the year preceding the year of acquisition including the tax-effected amortization of the acquired trade name and transaction related costs. Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) Revenue $ 335,585 $ 266,786 $ 1,025,600 $ 818,382 Pretax income (loss) 35,935 1,586 108,188 (22,298) Provision (benefit) for income taxes 4,858 (3,811) 28,339 (4,025) Net income (loss) $ 31,077 $ 5,397 $ 79,849 $ (18,273) |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities | The following table summarizes the carrying amount and classification of the VIEs’ assets and liabilities in the consolidated balances sheets as of September 30, 2022 and December 31, 2021. September 30, 2022 December 31, 2021 (dollars in thousands) Cash $ 4,960 $ 130 Cash held in escrow 11 — Restricted cash — 443 Real estate inventories 113,109 121,040 Due from affiliates 317 — Other assets 4,185 195 Total assets $ 122,582 $ 121,808 Accounts payable $ 1,596 $ 1,779 Accrued expenses and other liabilities 5,484 1,400 Due to affiliates — 226 Notes payable, net — 81,584 Total liabilities $ 7,080 $ 84,989 |
Real Estate Inventories (Tables
Real Estate Inventories (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Real Estate Inventories [Abstract] | |
Schedule of Real Estate Inventories | Real estate inventories are summarized as follows: September 30, 2022 December 31, 2021 (dollars in thousands) Deposits and pre-acquisition costs $ 98,764 $ 65,724 Land held and land under development 216,945 243,310 Homes completed or under construction 846,291 526,950 Model homes 17,418 8,808 Total real estate inventories $ 1,179,418 $ 844,792 |
Capitalized Interest (Tables)
Capitalized Interest (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Components Of Interest Costs | For the periods reported, interest incurred, capitalized, and expensed was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) (dollars in thousands) Related party interest incurred $ 74 $ 183 $ 231 $ 183 Other interest incurred 13,759 6,597 28,352 18,701 Total interest incurred 13,833 6,780 28,583 18,884 Related party interest capitalized 74 183 231 183 Other interest capitalized 13,759 6,597 28,352 18,701 Total interest capitalized 13,833 6,780 28,583 18,884 Previously capitalized related party interest included in cost of sales $ 714 $ 2,571 $ 3,831 $ 9,813 Previously capitalized other interest included in cost of sales 9,436 4,711 27,445 15,835 Related party interest relieved to equity in income from unconsolidated joint ventures — 278 69 1,042 Other interest relieved to equity in income from unconsolidated joint ventures — 3 1 14 Other interest expensed — 11 — 32 Total interest expense included in pretax income $ 10,150 $ 7,574 $ 31,346 $ 26,736 |
Notes and Other Debts Payable_2
Notes and Other Debts Payable, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Amounts outstanding under notes and other debts payable, net consist of the following: September 30, 2022 December 31, 2021 (dollars in thousands) Construction loan $ — $ 82,617 Line of credit facilities 594,300 390,300 Notes payable 594,300 472,917 Deferred loan costs (9,235) (11,800) Notes and other debts payable, net $ 585,065 $ 461,117 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Product Warranty Liability | Estimated future direct warranty costs are accrued and charged to cost of sales in the period when the related homebuilding revenues are recognized. Changes in the Company’s warranty accrual are detailed in the table below: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) Beginning warranty accrual $ 18,010 $ 13,595 $ 15,692 $ 11,730 Warranty provision 1,359 1,107 4,602 3,972 Warranty payments (1,118) (436) (2,043) (1,436) Ending warranty accrual $ 18,251 $ 14,266 $ 18,251 $ 14,266 |
Operating Lease Maturity Schedule | Future minimum payments under the noncancelable operating leases in effect at September 30, 2022 were as follows (dollars in thousands) : 2022 $ 1,194 2023 4,101 2024 2,988 2025 2,043 2026 1,765 Thereafter 2,808 Total lease payments 14,899 Less: Discount (1,274) Present value of lease liabilities $ 13,625 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table summarizes total revenues and pretax income before income tax expense by segment: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands) Revenue Arizona $ 76,808 $ 65,502 $ 234,927 $ 202,750 California 118,977 110,046 343,466 346,680 Florida 103,564 31,161 320,358 59,519 Metro New York 28,132 — 95,758 — Texas 8,104 7,420 25,982 15,873 Total revenues $ 335,585 $ 214,129 $ 1,020,491 $ 624,822 Pretax income Arizona $ 6,046 $ 5,103 $ 17,653 $ 10,371 California 20,059 7,965 68,085 22,706 Florida 4,172 147 8,028 1,032 Metro New York (810) (622) 646 (1,592) Texas (215) (209) (93) 186 Corporate (3,950) 1,375 (27,663) (15,197) Total pretax income $ 25,302 $ 13,759 $ 66,656 $ 17,506 |
Reconciliation of Assets from Segment to Consolidated | The following table summarizes total assets by segment: September 30, 2022 December 31, 2021 (dollars in thousands) Assets Arizona $ 375,874 $ 360,598 California 513,967 400,292 Florida 431,851 102,158 Metro New York 60,789 124,962 Texas 39,070 35,984 Corporate 47,307 241,520 Total assets $ 1,468,858 $ 1,265,514 |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents carrying values and estimated fair values of financial instruments: September 30, 2022 December 31, 2021 Hierarchy Carrying Value Fair Value Carrying Value Fair Value (dollars in thousands) Liabilities: Construction loan (1)(2) Level 2 $ — $ — $ 82,617 $ 82,617 Line of credit facilities (1) Level 2 $ 594,300 $ 594,300 $ 390,300 $ 390,300 Warrant liability Level 3 $ — $ — $ 9,185 $ 9,185 (1) Carrying amount approximates fair value due to the variable interest rate terms of these loans. Carrying value excludes any associated deferred loan costs. (2) In April 2022, the remaining construction loan was repaid in full. |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table reconciles the beginning and ending balances for the Level 3 recurring fair value measurements during the periods presented: Nine Months Ended September 30, 2022 2021 Warrant liability (dollars in thousands) Beginning balance (1) $ 9,185 $ 11,275 Changes in fair value 7,315 3,245 Repurchases of warrants (16,500) — Ending balance $ — $ 14,520 (1) The beginning balance for the period ended September 30, 2021 represents the balance as of January 7, 2021, the Closing Date of the Merger. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock Compensation Expense | The following table presents a summary of the Company’s nonvested PSUs and RSUs for the nine months ended September 30, 2022: Awards Weighted Average Grant Date Fair Value (in thousands) Nonvested, at December 31, 2021 768 $ 9.43 Granted 1,136 8.48 Vested (278) 9.19 Forfeited — — Nonvested, at September 30, 2022 1,626 $ 8.82 |
Schedule of Stock Option Activity | The following table presents a summary of the Company’s stock options activity for the nine months ended September 30, 2022: Number of Shares Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (in thousands) (in years) (in thousands) Options outstanding at December 31, 2021 — $ — Granted 744 8.82 Exercised — — Forfeited (60) 8.83 Options outstanding at September 30, 2022 (1) 684 $ 8.82 9.46 $ — Options exercisable at September 30, 2022 — $ — — $ — (1) As of September 30, 2022, the stock options were out-of-the-money, as the exercise price of the stock options exceeded the average market price of the Company’s common stock. |
Share-based Payment Arrangement, Performance Shares, Activity | summary of the Company’s outstanding RSUs and PSUs, assuming the current estimated level of performance achievement (in thousands, except years): September 30, 2022 (in thousands, except period) Unvested units 1,626 Remaining cost on unvested units $ 4,415 Remaining vesting period 4.25 years |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted earnings per share (“EPS”) for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (dollars in thousands, except share and per share amounts) Numerator Net income attributable to Landsea Homes Corporation $ 19,970 $ 10,797 $ 47,970 $ 14,387 Less: undistributed earnings allocated to participating shares (487) (239) (1,094) (315) Net income attributable to common stockholders $ 19,483 $ 10,558 $ 46,876 $ 14,072 Denominator Weighted average common shares outstanding - basic 40,935,152 46,281,091 43,768,269 46,062,200 Adjustment for weighted average participating shares outstanding (1,000,000) (1,000,000) (1,000,000) (985,185) Adjusted weighted average common shares outstanding under two class method - basic 39,935,152 45,281,091 42,768,269 45,077,015 Dilutive effect of warrants — — — — Dilutive effect of share-based awards 162,117 48,800 175,602 69,537 Adjusted weighted average common shares outstanding under two class method - diluted 40,097,269 45,329,891 42,943,871 45,146,552 Earnings per share Basic $ 0.49 $ 0.23 $ 1.10 $ 0.31 Diluted $ 0.49 $ 0.23 $ 1.09 $ 0.31 |
Supplemental Disclosures of C_2
Supplemental Disclosures of Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | The following table presents certain supplemental cash flow information: Nine Months Ended September 30, 2022 2021 (dollars in thousands) Supplemental disclosures of cash flow information Interest paid, net of amounts capitalized $ — $ 32 Income taxes paid $ 32,454 $ 5,905 Supplemental disclosures of non-cash investing and financing activities Right-of-use assets obtained in exchange for operating lease liabilities for new or modified operating leases $ 3,660 $ — Transfer of deferred tax asset to Landsea Holdings $ — $ 12,119 Conversion of deferred offering costs to additional paid-in-capital $ — $ 9,229 |
Company (Details)
Company (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jan. 07, 2021 USD ($) $ / shares shares | Mar. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) segment shares | Sep. 30, 2021 USD ($) | Jun. 30, 2022 $ / shares | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Number of reportable segments | segment | 5 | ||||
Business Acquisition [Line Items] | |||||
Proceeds from the Merger, net of fees and other costs | $ 0 | $ 64,434 | |||
Phantom Awards | |||||
Business Acquisition [Line Items] | |||||
Grants in period (in shares) | shares | 200,000 | ||||
Grant date value at the time of merger | $ 1,900 | ||||
Private Placement Warrants | |||||
Business Acquisition [Line Items] | |||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 11.50 | $ 11.50 | |||
General and Administrative Expense | Phantom Awards | |||||
Business Acquisition [Line Items] | |||||
Accelerated vesting cost | $ 2,700 | ||||
Merger Agreement | |||||
Business Acquisition [Line Items] | |||||
Proceeds from the Merger, net of fees and other costs | $ 64,400 | ||||
Payments for merger related costs | 28,700 | ||||
Transaction expenses incurred | 7,500 | ||||
Direct and incremental costs | 16,700 | ||||
Merger Agreement | Phantom Awards | |||||
Business Acquisition [Line Items] | |||||
Cash payments of phantom stock awards | $ 2,900 | ||||
Grants in period (in shares) | shares | 200,000 | ||||
Grant date value at the time of merger | $ 1,900 | ||||
Merger Agreement | General and Administrative Expense | Phantom Awards | |||||
Business Acquisition [Line Items] | |||||
Accelerated vesting cost | $ 2,700 | ||||
Merger Agreement | Common Class A | Level Field Capital, LLC | |||||
Business Acquisition [Line Items] | |||||
Equity interests still held (in shares) | shares | 1,000,000 | ||||
Merger Agreement | Common Class A | LF Capital Acquisitions Corps | |||||
Business Acquisition [Line Items] | |||||
Stock consideration, amount | $ 343,800 | ||||
Stock consideration (in shares) | shares | 32,600,000 | ||||
Stock consideration, share price (in dollars per share) | $ / shares | $ 10.56 | ||||
Merger Agreement | Earnout Shares | Landsea Holdings | Level Field Capital, LLC | |||||
Business Acquisition [Line Items] | |||||
Equity interests transferred (in shares) | shares | 500,000 | ||||
Merger Agreement | Private Placement Warrants | Level Field Capital, LLC | |||||
Business Acquisition [Line Items] | |||||
Equity interests forfeited (in shares) | shares | 2,300,000 | ||||
Merger Agreement | Private Placement Warrants | Landsea Holdings | Level Field Capital, LLC | |||||
Business Acquisition [Line Items] | |||||
Equity interests transferred (in shares) | shares | 2,200,000 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Jan. 18, 2022 USD ($) lot realEstate_Community | May 04, 2021 USD ($) project | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 68,639 | $ 68,639 | $ 24,457 | ||||
Goodwill | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill amortization period | 15 years | ||||||
Hanover | |||||||
Business Acquisition [Line Items] | |||||||
Percentage interests acquired | 100% | 100% | |||||
Cash consideration | $ 262,600 | ||||||
Repayments of debt | 69,300 | ||||||
Payment of land related deposits | $ 15,600 | ||||||
Number of communities | realEstate_Community | 20 | ||||||
Number of lots | lot | 3,800 | ||||||
Goodwill | $ 44,182 | ||||||
Transaction related costs | 100 | 700 | |||||
Revenue of acquiree since acquisition | 72,200 | 231,500 | |||||
Income before tax, inclusive of purchase price accounting | $ 4,500 | $ 8,600 | |||||
Hanover | Trade Names | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 1,590 | ||||||
Useful life (in years) | 1 year | ||||||
Vintage | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration | $ 54,600 | ||||||
Repayments of debt | 3,800 | ||||||
Intangible assets acquired | 1,600 | ||||||
Goodwill | 3,752 | ||||||
Transaction related costs | $ 300 | $ 800 | |||||
Debt assumed in connection with acquisition | $ 32,100 | ||||||
Number of projects acquired in acquisition (number of projects) | project | 20 | ||||||
Number of lots acquired in acquisition | project | 1,800 | ||||||
Vintage | Trade Names | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 1,550 | ||||||
Useful life (in years) | 1 year | ||||||
Vintage | Goodwill | |||||||
Business Acquisition [Line Items] | |||||||
Useful life (in years) | 15 years | ||||||
Goodwill | $ 3,800 |
Business Combinations - Net Ass
Business Combinations - Net Assets Acquired (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Jan. 18, 2022 | Dec. 31, 2021 | May 04, 2021 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Goodwill | $ 68,639 | $ 24,457 | ||
Hanover | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Cash | $ 3,857 | |||
Real estate inventories | 232,071 | |||
Goodwill | 44,182 | |||
Other assets | 378 | |||
Total assets | 282,078 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract] | ||||
Accounts payable | 6,329 | |||
Accrued expenses | 13,165 | |||
Total liabilities | 19,494 | |||
Net assets acquired | 262,584 | |||
Hanover | Trade Names | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Trade name | $ 1,590 | |||
Vintage | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Cash | $ 10,063 | |||
Real estate inventories | 93,699 | |||
Goodwill | 3,752 | |||
Trade name | 1,600 | |||
Other assets | 3,956 | |||
Total assets | 113,020 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract] | ||||
Accounts payable | 1,641 | |||
Accrued expenses | 24,660 | |||
Notes payable | 32,119 | |||
Total liabilities | 58,420 | |||
Net assets acquired | 54,600 | |||
Vintage | Trade Names | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Trade name | $ 1,550 |
Business Combinations - Pro For
Business Combinations - Pro Forma Financial Information (Details) - Hanover and Vintage - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Business Acquisition [Line Items] | ||||
Revenue | $ 335,585 | $ 266,786 | $ 1,025,600 | $ 818,382 |
Pretax income (loss) | 35,935 | 1,586 | 108,188 | (22,298) |
Provision (benefit) for income taxes | 4,858 | (3,811) | 28,339 | (4,025) |
Net income (loss) | $ 31,077 | $ 5,397 | $ 79,849 | $ (18,273) |
Variable Interest Entities (Det
Variable Interest Entities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Variable Interest Entity [Line Items] | ||
Cash | $ 110,192 | $ 342,810 |
Cash held in escrow | 7,190 | 4,079 |
Restricted cash | 0 | 443 |
Real estate inventories | 1,179,418 | 844,792 |
Due from affiliates | 5,180 | 4,465 |
Total assets | 1,468,858 | 1,265,514 |
Accounts payable | 82,347 | 73,734 |
Accrued expenses and other liabilities | 114,836 | 97,724 |
Due to affiliates | 2,357 | 2,357 |
Notes payable, net | 585,065 | 461,117 |
Total liabilities | 784,605 | 644,117 |
Variable Interest Entities | ||
Variable Interest Entity [Line Items] | ||
Cash | 4,960 | 130 |
Cash held in escrow | 11 | 0 |
Restricted cash | 0 | 443 |
Real estate inventories | 113,109 | 121,040 |
Due from affiliates | 317 | 0 |
Other assets | 4,185 | 195 |
Total assets | 122,582 | 121,808 |
Accounts payable | 1,596 | 1,779 |
Accrued expenses and other liabilities | 5,484 | 1,400 |
Due to affiliates | 0 | 226 |
Notes payable, net | 0 | 81,584 |
Total liabilities | $ 7,080 | $ 84,989 |
Real Estate Inventories - Sched
Real Estate Inventories - Schedule of Real Estate Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Real Estate Inventories [Abstract] | ||
Deposits and pre-acquisition costs | $ 98,764 | $ 65,724 |
Land held and land under development | 216,945 | 243,310 |
Homes completed or under construction | 846,291 | 526,950 |
Model homes | 17,418 | 8,808 |
Total real estate inventories | $ 1,179,418 | $ 844,792 |
Real Estate Inventories - Narra
Real Estate Inventories - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Real Estate Inventories [Abstract] | ||||
Impairment of real estate inventories | $ 0 | $ 0 | $ 0 | $ 0 |
Capitalized Interest (Details)
Capitalized Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Schedule of Capitalization [Line Items] | ||||
Related party interest incurred | $ 74 | $ 183 | $ 231 | $ 183 |
Other interest incurred | 13,759 | 6,597 | 28,352 | 18,701 |
Total interest incurred | 13,833 | 6,780 | 28,583 | 18,884 |
Related party interest capitalized | 74 | 183 | 231 | 183 |
Other interest capitalized | 13,759 | 6,597 | 28,352 | 18,701 |
Total interest capitalized | 13,833 | 6,780 | 28,583 | 18,884 |
Other interest expensed | 0 | 11 | 0 | 32 |
Total interest expense included in pretax income | 10,150 | 7,574 | 31,346 | 26,736 |
Cost of Sales | ||||
Schedule of Capitalization [Line Items] | ||||
Previously capitalized related party interest included in cost of sales | 714 | 2,571 | 3,831 | 9,813 |
Other interest relieved to equity in income from unconsolidated joint ventures | 9,436 | 4,711 | 27,445 | 15,835 |
Income (Loss) From Unconsolidated Joint Ventures | ||||
Schedule of Capitalization [Line Items] | ||||
Previously capitalized related party interest included in cost of sales | 0 | 278 | 69 | 1,042 |
Other interest relieved to equity in income from unconsolidated joint ventures | $ 0 | $ 3 | $ 1 | $ 14 |
Other Assets - Narrative (Detai
Other Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Contract with Customer, Asset, after Allowance for Credit Loss | $ 16.6 | $ 16.6 | $ 6.1 |
Revenue, remaining performance obligation, amount | 20.6 | 20.6 | 63.9 |
Deferred revenue | 0.4 | 0.4 | $ 4 |
Lot sales and other | |||
Disaggregation of Revenue [Line Items] | |||
Deferred revenue recognized from lot sales in prior years | $ 0 | $ 4 |
Notes and Other Debts Payable_3
Notes and Other Debts Payable, net - Schedule of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Notes payable | $ 594,300 | $ 472,917 |
Deferred loan costs | (9,235) | (11,800) |
Notes and other debts payable, net | 585,065 | 461,117 |
Construction loan | ||
Debt Instrument [Line Items] | ||
Notes payable | 0 | 82,617 |
Line of credit facilities | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 594,300 | $ 390,300 |
Notes and Other Debts Payable_4
Notes and Other Debts Payable, net - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2022 | Jun. 30, 2022 | |
Line of credit facilities | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 850,000,000 | |||
Line of credit facilities | Credit Agreement | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 3.35% | |||
Line of credit facilities | Credit Agreement | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.75% | |||
Effective interest rate at period end | 5.95% | |||
Line of credit facilities | Credit Agreement | Minimum | ||||
Debt Instrument [Line Items] | ||||
Credit agreement, current borrowing capacity | $ 20,000,000 | $ 70,000,000 | ||
Line of credit facilities | Credit Agreement | Minimum | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 3.85% | |||
Line of credit facilities | Credit Agreement | Maximum | ||||
Debt Instrument [Line Items] | ||||
Credit agreement, current borrowing capacity | $ 675,000,000 | $ 655,000,000 | ||
Paycheck Protection Program Notes | ||||
Debt Instrument [Line Items] | ||||
Proceeds from PPP loan | $ 14,900,000 | $ 4,300,000 | ||
Paycheck Protection Program Notes | Debt Extinguishment Fees | ||||
Debt Instrument [Line Items] | ||||
Payment for debt extinguishment | $ 2,500,000 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Loss Contingencies [Line Items] | |||||||
Weighted average remaining lease term (in years) | 4 years 7 months 6 days | 4 years 1 month 6 days | 4 years 7 months 6 days | 4 years 1 month 6 days | |||
Weighted average rate (percent) | 3.80% | 3.80% | |||||
Operating Lease, Right-of-Use Asset | $ 12,800 | $ 12,600 | $ 12,800 | $ 12,600 | |||
Lease liabilities | 13,625 | 13,200 | 13,625 | $ 13,200 | |||
Operating lease expense | $ 500 | $ 500 | $ 1,600 | $ 1,300 | |||
Minimum | |||||||
Loss Contingencies [Line Items] | |||||||
Lease term (in years) | 1 year | 1 year | |||||
Maximum | |||||||
Loss Contingencies [Line Items] | |||||||
Lease term (in years) | 8 years | 8 years | |||||
Sale and Lease Back of Model Homes | |||||||
Loss Contingencies [Line Items] | |||||||
Sale, leaseback lease terms (in years) | 2 years | ||||||
Performance Guarantee | |||||||
Loss Contingencies [Line Items] | |||||||
Performance bonds outstanding | $ 117,000 | 94,700 | $ 117,000 | $ 94,700 | |||
Paycheck Protection Program Notes | |||||||
Loss Contingencies [Line Items] | |||||||
Proceeds from PPP loan | $ 14,900 | $ 4,300 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Product Warranty Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||||
Beginning warranty accrual | $ 18,010 | $ 13,595 | $ 15,692 | $ 11,730 |
Warranty provision | 1,359 | 1,107 | 4,602 | 3,972 |
Warranty payments | (1,118) | (436) | (2,043) | (1,436) |
Ending warranty accrual | $ 18,251 | $ 14,266 | $ 18,251 | $ 14,266 |
Commitments and Contingencies_3
Commitments and Contingencies - Maturity Schedule (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
2022 | $ 1,194 | |
2023 | 4,101 | |
2024 | 2,988 | |
2025 | 2,043 | |
2026 | 1,765 | |
Thereafter | 2,808 | |
Total lease payments | 14,899 | |
Less: Discount | (1,274) | |
Present value of lease liabilities | $ 13,625 | $ 13,200 |
Related Party Transactions (Det
Related Party Transactions (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||
Jun. 30, 2022 USD ($) transaction $ / shares shares | Dec. 31, 2021 USD ($) | Jul. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) | May 31, 2022 USD ($) $ / shares shares | Jan. 31, 2022 USD ($) | Jan. 31, 2021 USD ($) | |
Related Party Transaction [Line Items] | ||||||||||
Stock repurchase program, authorized (in shares) | shares | 0 | 0 | ||||||||
Revenue | $ 335,585 | $ 214,129 | $ 1,020,491 | $ 624,822 | ||||||
Operating Lease, Right-of-Use Asset | $ 12,600 | 12,800 | 12,800 | |||||||
Lease liabilities | 13,200 | 13,625 | 13,625 | |||||||
Home sales | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Revenue | 326,496 | 208,916 | 975,269 | 603,281 | ||||||
Cost of sales and expenses | 258,362 | 175,349 | 770,220 | 511,177 | ||||||
Lot sales and other | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Revenue | 9,089 | 5,213 | 45,222 | 21,541 | ||||||
Cost of sales and expenses | 10,737 | 3,419 | 40,546 | 16,929 | ||||||
California | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Revenue | 118,977 | 110,046 | 343,466 | 346,680 | ||||||
Private Placement Warrants | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Stock repurchase program, authorized (in shares) | shares | 2,800,000 | |||||||||
Landsea Holding Share Repurchase Program | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of transactions | transaction | 2 | |||||||||
Stock repurchase program, authorized (in shares) | shares | 4,400,000 | |||||||||
Stock repurchase program, authorized amount | $ 30,000 | |||||||||
Stock consideration, share price (in dollars per share) | $ / shares | $ 6.82 | $ 7.18 | ||||||||
Discount rate | 5% | |||||||||
Landsea Holding Share Repurchase Program | Private Placement Warrants | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Stock repurchase program, authorized (in shares) | shares | 5,500,000 | |||||||||
Stock repurchase program, authorized amount | $ 8,400 | $ 8,400 | ||||||||
Stock consideration, share price (in dollars per share) | $ / shares | $ 3 | |||||||||
Landsea Holding Share Repurchase Program | Private Placement Warrants | Landsea Holdings | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Stock repurchase program, authorized (in shares) | shares | 2,200,000 | |||||||||
Share Repurchase Program | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Stock repurchase program, authorized (in shares) | shares | 4,398,826 | |||||||||
Stock repurchase program, authorized amount | $ 30,000 | $ 10,000 | ||||||||
Stock consideration, share price (in dollars per share) | $ / shares | $ 3 | $ 3 | $ 6.82 | |||||||
Share Repurchase Program | Private Placement Warrants | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Stock repurchase program, authorized amount | $ 16,500 | $ 16,500 | ||||||||
Share Repurchase Program | Private Placement Warrants | Landsea Holdings | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Stock repurchase program, authorized (in shares) | shares | 2,200,000 | 2,200,000 | ||||||||
Stock repurchase program, authorized amount | $ 6,600 | $ 6,600 | $ 6,600 | |||||||
Equity Method Investee | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Due from related parties | 2,100 | 2,800 | 2,800 | |||||||
Affiliated Entity | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Payments for rent | 200 | 600 | ||||||||
Operating Lease, Right-of-Use Asset | 2,000 | 1,500 | 1,500 | |||||||
Lease liabilities | 2,000 | 1,500 | 1,500 | |||||||
Related party interest expense | 0 | 278 | 69 | 1,042 | ||||||
Affiliated Entity | Home sales | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Revenue from Related Parties | $ 15,200 | |||||||||
Related party interest expense | 714 | 2,571 | 3,831 | 9,813 | ||||||
Affiliated Entity | Lot Sales and Other | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Revenue | 0 | 0 | 1,249 | 0 | ||||||
Cost of sales and expenses | 0 | $ 0 | 1,256 | $ 0 | ||||||
Affiliated Entity | California | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party transaction, rate | 7% | |||||||||
Related party interest expense | 200 | 800 | ||||||||
Developed lots purchased in the period | 1,700 | 7,900 | ||||||||
Affiliated Entity | Predetermined Land Purchase Price | California | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party transaction, amounts of transaction | $ 28,900 | |||||||||
Affiliated Entity | Sale and Lease Back of Model Homes | Lot Sales and Other | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Revenue | 1,200 | |||||||||
LHold | Corporate Joint Venture | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Deferred tax assets transferred to Landsea Holdings | $ 12,100 | |||||||||
Landsea Capital Fund | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party transaction, amounts of transaction | $ 3,100 | $ 3,100 | ||||||||
Landsea Capital Fund | LCF JV | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party transaction, amounts of transaction | $ 55,000 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 15.90% | 21.60% | 26.20% | 18.10% |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of geographic regions | segment | 5 | |
Number of reportable segments | segment | 5 | |
Goodwill | $ 68,639 | $ 24,457 |
Arizona | ||
Segment Reporting Information [Line Items] | ||
Goodwill | 20,700 | 20,700 |
Florida | ||
Segment Reporting Information [Line Items] | ||
Goodwill | $ 47,900 | $ 3,800 |
Segment Reporting - Revenue and
Segment Reporting - Revenue and Pretax Income by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 335,585 | $ 214,129 | $ 1,020,491 | $ 624,822 |
Total pretax income | 25,302 | 13,759 | 66,656 | 17,506 |
Corporate | ||||
Segment Reporting Information [Line Items] | ||||
Total pretax income | (3,950) | 1,375 | (27,663) | (15,197) |
Arizona | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 76,808 | 65,502 | 234,927 | 202,750 |
Arizona | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Total pretax income | 6,046 | 5,103 | 17,653 | 10,371 |
California | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 118,977 | 110,046 | 343,466 | 346,680 |
California | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Total pretax income | 20,059 | 7,965 | 68,085 | 22,706 |
Florida | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 103,564 | 31,161 | 320,358 | 59,519 |
Florida | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Total pretax income | 4,172 | 147 | 8,028 | 1,032 |
Metro New York | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 28,132 | 0 | 95,758 | 0 |
Metro New York | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Total pretax income | (810) | (622) | 646 | (1,592) |
Texas | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 8,104 | 7,420 | 25,982 | 15,873 |
Texas | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Total pretax income | $ (215) | $ (209) | $ (93) | $ 186 |
Segment Reporting - Assets by S
Segment Reporting - Assets by Segment (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Segment Reporting Information [Line Items] | ||
Total assets | $ 1,468,858 | $ 1,265,514 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Total assets | 47,307 | 241,520 |
Arizona | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total assets | 375,874 | 360,598 |
California | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total assets | 513,967 | 400,292 |
Florida | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total assets | 431,851 | 102,158 |
Metro New York | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total assets | 60,789 | 124,962 |
Texas | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total assets | $ 39,070 | $ 35,984 |
Fair Value - Schedule of Fair V
Fair Value - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Carrying Value | Construction loan | ||
Liabilities: | ||
Long-term debt | $ 0 | $ 82,617 |
Carrying Value | Line of credit facilities | ||
Liabilities: | ||
Long-term debt | 594,300 | 390,300 |
Carrying Value | Warrant liability | ||
Liabilities: | ||
Long-term debt | 0 | 9,185 |
Fair Value | Level 2 | Construction loan | ||
Liabilities: | ||
Long-term debt | 0 | 82,617 |
Fair Value | Level 2 | Line of credit facilities | ||
Liabilities: | ||
Long-term debt | 594,300 | 390,300 |
Fair Value | Level 3 | Warrant liability | ||
Liabilities: | ||
Long-term debt | $ 0 | $ 9,185 |
Fair Value - Narrative (Details
Fair Value - Narrative (Details) | Sep. 30, 2021 |
Measurement Input, Price Volatility | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Warrants, measurement input | 0.480 |
Fair Value - Schedule of Warran
Fair Value - Schedule of Warrant Liability (Details) - Fair Value, Recurring - Level 3 - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||
Beginning balance | $ 9,185 | $ 11,275 |
Changes in fair value | 7,315 | 3,245 |
Repurchases of warrants | (16,500) | 0 |
Ending balance | $ 0 | $ 14,520 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Phantom Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Cash paid for phantom stock awards | $ 2.9 | ||||
Grants in period (in shares) | 200,000 | ||||
Grant date value at the time of merger | $ 1.9 | $ 1.9 | |||
Phantom Awards | General and Administrative Expense | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Accelerated vesting cost | $ 2.7 | ||||
Restricted Stock Units and Performance Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Grants in period (in shares) | 1,136,000 | ||||
Restricted Stock Units and Performance Stock Units | General and Administrative Expense | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 0.9 | $ 1.2 | $ 2.8 | $ 4.1 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Compensation Expense (Details) - Restricted Stock Units and Performance Stock Units shares in Thousands | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Awards | |
Nonvested, beginning of the year (in shares) | shares | 768 |
Grants in period (in shares) | shares | 1,136 |
Vested (in shares) | shares | (278) |
Forfeited (in shares) | shares | 0 |
Nonvested, End of the year (in shares) | shares | 1,626 |
Weighted Average Grant Date Fair Value | |
Weighted Average Grand Date Fair Value Outstanding, beginning of the year (in dollars per share) | $ / shares | $ 9.43 |
Grant date fair value (in dollars per share) | $ / shares | 8.48 |
Vested (in dollars per share) | $ / shares | 9.19 |
Forfeited (in dollars per share) | $ / shares | 0 |
Weighted Average Grand Date Fair Value Outstanding, End of the year (in dollars per share) | $ / shares | $ 8.82 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Details) - Stock Option - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Options | ||
Options outstanding, beginning balance (in shares) | 0 | |
Granted (in shares) | 744,000 | |
Exercised (in shares) | 0 | |
Forfeited (in shares) | (60,000) | |
Options outstanding, ending balance (in shares) | 684,000 | 0 |
Options exercisable (in shares) | 0 | |
Weighted Average Exercise Price | ||
Weighted average exercise price, beginning balance (in USD per share) | $ 0 | |
Granted (in USD per share) | 8.82 | |
Exercised (in USD per share) | 0 | |
Forfeited (in USD per share) | 8.83 | |
Weighted average exercise price, ending balance (in USD per share) | 8.82 | $ 0 |
Options exercisable (in USD per share) | $ 0 | |
Weighted Average Remaining Contractual Term | ||
Weighted Average Remaining Contractual Term | 9 years 5 months 15 days | |
Aggregate Intrinsic Value | ||
Aggregate intrinsic value | $ 0 | |
Options exercisable | $ 0 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Unvested Outstanding RSUs and PSUs (Details) - Restricted Stock Units and Performance Stock Units shares in Thousands, $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested units (in shares) | shares | 1,626 |
Remaining cost on unvested units | $ | $ 4,415 |
Remaining vesting period (in years) | 4 years 3 months |
Stockholders' Equity (Details)
Stockholders' Equity (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | 9 Months Ended | |||||||
Jun. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) segment $ / shares shares | Sep. 30, 2021 USD ($) | May 31, 2022 USD ($) $ / shares shares | Apr. 30, 2022 USD ($) | Jan. 31, 2022 USD ($) $ / shares | Dec. 31, 2021 $ / shares shares | Jan. 07, 2021 $ / shares | Dec. 31, 2020 shares | |
Class of Stock [Line Items] | |||||||||
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 | |||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 | |||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||
Common stock, shares issued (in shares) | 42,110,794 | 46,281,091 | 32,600,000 | ||||||
Common stock, shares outstanding (in shares) | 40,950,043 | 46,281,091 | 32,600,000 | ||||||
Preferred stock, shares issued (in shares) | 0 | 0 | |||||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | |||||||
Repurchase of common stock | $ | $ 40,200 | ||||||||
Additional authorized repurchase amount | $ | $ 10,000 | ||||||||
Stock repurchase program, authorized (in shares) | 0 | ||||||||
Warrants outstanding (in shares) | 15,525,000 | ||||||||
Payment for buyback of warrants | $ | $ 16,500 | $ 0 | |||||||
Public Warrants | |||||||||
Class of Stock [Line Items] | |||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 1.15 | ||||||||
Amendment distribution price per per warrant (in dollars per share) | $ / shares | $ 1.85 | ||||||||
Payment for buyback of warrants | $ | $ 28,700 | ||||||||
Warrants outstanding, term (in years) | 5 years | ||||||||
Minimum conversion price, per warrant (in dollars per share) | $ / shares | $ 0.01 | ||||||||
Written notice, period | 30 days | ||||||||
Stock price trigger (in dollars per share) | $ / shares | $ 18 | ||||||||
Threshold trading days | segment | 20 | ||||||||
Threshold consecutive trading days | segment | 30 | ||||||||
Number of shares per warrant (in shares) | 0.1 | ||||||||
Private Placement Warrants | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchase program, authorized (in shares) | 2,800,000 | ||||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 11.50 | $ 11.50 | |||||||
Number of shares per warrant (in shares) | 1 | ||||||||
Share Repurchase Program | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchase program, authorized amount | $ | $ 30,000 | $ 10,000 | |||||||
Share repurchase price, maximum price per share (in dollars per share) | $ / shares | $ 15 | ||||||||
Remaining authorized repurchase amount | $ | $ 0 | ||||||||
Repurchase of common stock (in shares) | 1,160,751 | ||||||||
Repurchase of common stock | $ | $ 10,000 | ||||||||
Stock repurchase program, authorized (in shares) | 4,398,826 | ||||||||
Stock consideration, share price (in dollars per share) | $ / shares | $ 3 | $ 6.82 | |||||||
Share Repurchase Program | Private Placement Warrants | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchase program, authorized amount | $ | $ 16,500 | ||||||||
Share Repurchase Program | Private Placement Warrants | Landsea Holdings | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchase program, authorized amount | $ | 6,600 | $ 6,600 | |||||||
Stock repurchase program, authorized (in shares) | 2,200,000 | ||||||||
Landsea Holding Share Repurchase Program | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchase program, authorized amount | $ | $ 30,000 | ||||||||
Stock repurchase program, authorized (in shares) | 4,400,000 | ||||||||
Stock consideration, share price (in dollars per share) | $ / shares | $ 6.82 | $ 7.18 | |||||||
Landsea Holding Share Repurchase Program | Private Placement Warrants | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchase program, authorized amount | $ | $ 8,400 | ||||||||
Stock repurchase program, authorized (in shares) | 5,500,000 | ||||||||
Stock consideration, share price (in dollars per share) | $ / shares | $ 3 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator | ||||
Net income attributable to Landsea Homes Corporation | $ 19,970 | $ 10,797 | $ 47,970 | $ 14,387 |
Less: undistributed earnings allocated to participating shares | (487) | (239) | (1,094) | (315) |
Net income attributable to common stockholders | $ 19,483 | $ 10,558 | $ 46,876 | $ 14,072 |
Denominator | ||||
Weighted average common shares outstanding - basic (in shares) | 40,935,152 | 46,281,091 | 43,768,269 | 46,062,200 |
Adjustment for weighted average participating shares outstanding (in shares) | (1,000,000) | (1,000,000) | (1,000,000) | (985,185) |
Adjusted weighted average common shares outstanding under two class method - basic (in shares) | 39,935,152 | 45,281,091 | 42,768,269 | 45,077,015 |
Dilutive effect of warrants (in shares) | 0 | 0 | 0 | 0 |
Dilutive effect of share-based awards (in shares) | 162,117 | 48,800 | 175,602 | 69,537 |
Adjusted weighted average common shares outstanding under two class method - diluted (in shares) | 40,097,269 | 45,329,891 | 42,943,871 | 45,146,552 |
Earnings per share | ||||
Basic (in dollars per share) | $ 0.49 | $ 0.23 | $ 1.10 | $ 0.31 |
Diluted (in dollars per share) | $ 0.49 | $ 0.23 | $ 1.09 | $ 0.31 |
Antidilutive securities excluded from computation of earnings per share, amount | 1,600,000 | 7,100,000 | 1,600,000 | 7,100,000 |
Supplemental Disclosures of C_3
Supplemental Disclosures of Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Supplemental disclosures of cash flow information | ||
Interest paid, net of amounts capitalized | $ 0 | $ 32 |
Income taxes paid | 32,454 | 5,905 |
Supplemental disclosures of non-cash investing and financing activities | ||
Right-of-use assets obtained in exchange for operating lease liabilities for new or modified operating leases | 3,660 | 0 |
Transfer of deferred tax asset to Landsea Holdings | 0 | 12,119 |
Conversion of deferred offering costs to additional paid-in-capital | $ 0 | $ 9,229 |