Millrose Properties Surges 43% Post-Spin-Off—Inside the Story Behind Permian's Million-Share Reduction

Fund Pares Position Amid Strong Fundamentals

Permian Investment Partners, a Dallas-headquartered fund manager, scaled back its stake in Millrose Properties (NYSE: MRP) during the third quarter, offloading approximately 1 million shares and reducing its overall position value by roughly $19.9 million. As of September 30, the fund retained nearly 1.8 million MRP shares valued around $58.9 million, according to SEC filings released November 14.

The Timing: Repricing and Portfolio Discipline

Millrose Properties shares have appreciated approximately 43% since separating from Lennar in February, making it an attractive rebalancing opportunity for portfolio managers. Permian’s reduction reflects a classic risk management playbook—trimming concentrated positions after significant gains rather than a fundamental loss of confidence in the business.

Currently, MRP represents 6.7% of Permian’s 13F reportable assets under management. Larger holdings dominate the portfolio: TIC Solutions ($193.9M, 21.9% of AUM), GRFS ($173.8M, 19.6%), KBR ($150.5M, 17%), NRG ($125M, 14.1%), and ARMK ($81.7M, 9.2%).

Strong Q3 Execution Supports the Thesis

The timing of Permian’s sell coincides with robust operational results. Millrose Properties generated $179.3 million in revenue during the third quarter and reported adjusted funds from operations of $122.5 million, or $0.74 per share—exceeding prior expectations and warranting increased year-end guidance.

The company’s Homesite Option Purchase Platform (HOPP’R) continued scaling effectively, with $858 million redeployed into new land acquisitions alongside Lennar and an additional $770 million deployed under alternative agreements at improved yields. This capital-efficient model enables homebuilders to secure residential land rights without full upfront ownership, generating recurring income streams through option fees and related structures.

Understanding the Business Model

Millrose Properties operates as a specialized investment vehicle focused on homesite option solutions—a niche within residential real estate that provides institutional homebuilders and investors with capital-efficient land positioning. Rather than traditional real estate ownership, the platform facilitates land banking through option agreements, allowing participants to control property rights while minimizing deployed capital.

Revenue flows from structuring fees, transaction fees, and recurring income from managing these agreements over time. The 9.3% dividend yield reflects the company’s strong cash generation and commitment to distributing earnings to shareholders.

Valuation and Scale

As of the latest trading session, Millrose Properties shares were priced at $31.43, reflecting a market capitalization of $5.2 billion. Annual revenue reached $411 million (trailing twelve months), positioning the company as a meaningful player in the niche homesite solutions sector.

Reading Between the Lines

Permian’s decision to reduce exposure should not be interpreted as a red flag for MRP’s prospects. Instead, it represents disciplined portfolio management—harvesting gains in a position that has doubled post-spin-off while maintaining meaningful participation in a capital-light housing platform.

For long-term investors seeking yield-driven exposure to residential real estate fundamentals, Millrose Properties continues to merit consideration. The company’s focus on execution, balance sheet discipline, and sustainable dividend payouts positions it as a recurring-income play rather than a momentum bet. Fund ownership shifts, even from large institutional holders, matter less than operational trends and cash flow sustainability—both of which remain constructive for MRP at current levels.