Hovnanian Enterprises and Domain Real Estate Partners Announce $125 Million Land Banking Arrangement

RED BANK, N.J., and NEW YORK, Oct. 8, 2015 (GLOBE NEWSWIRE) -- Hovnanian Enterprises, Inc. (NYSE:HOV), a leading national homebuilder, and Domain Real Estate Partners, LLC ("Domain"), the residential investment affiliate of DW Partners, LP, announced today a land banking arrangement for $125 million.

Domain and Hovnanian anticipate identifying land parcels totaling $125 million in acquisition and development costs over the next two months. Domain, an affiliate of DW Partners, will acquire the portfolio of land parcels from Hovnanian and option finished lots on a monthly takedown basis back to Hovnanian.

"We are very pleased to announce this exciting new partnership with Domain," commented Ara Hovnanian, Chairman of the Board of Directors, President and Chief Executive Officer of Hovnanian Enterprises, Inc. "We intend to fill this land banking arrangement with land parcels we currently own. This land banking structure allows us to both enhance our returns on investment and increase our liquidity position by accessing outside capital. Simultaneously, we maintain control of the land parcels by entering into an option agreement for finished lots on a just-in-time basis."

David Warren, Chief Investment Officer and Chief Executive Officer of DW Partners, said, "We are excited to partner with Hovnanian through our Domain affiliate and we believe this is a significant step forward toward a long and mutually beneficial relationship. This investment builds on our longstanding expertise in credit and residential real estate and gives limited partners in our funds access to an exciting and growing area of the capital markets."

David Valiaveedan, Managing Partner of Domain Real Estate Partners, said, "Hovnanian is a great builder with a longstanding track record of performance in the residential housing market. We are extremely pleased to have them as one of our builder partners."


Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, Minnesota, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian® Homes®, Brighton Homes® and Parkwood Builders. As the developer of K. Hovnanian's® Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes.

Additional information on Hovnanian Enterprises, Inc., including a summary investment profile and the Company's 2014 annual report, can be accessed through the "Investor Relations" section of the Hovnanian Enterprises' website at http://www.khov.com. To be added to Hovnanian's investor e-mail list please send an e-mail to IR@khov.com or sign up at http://www.khov.com.


Domain Real Estate Partners LLC ("Domain") is affiliated with DW Partners and is a national residential real estate investment firm. Domain aims to provide flexible financing solutions to homebuilders, land developers, and condominium developers who own land entitled for residential development. The Domain management team has significant development and construction experience and understands the financing challenges facing land owners. The firm seeks attractive risk adjusted returns and is not limited by investment structure. Its investment activities focus on land banking, joint venture equity and mezzanine debt and it seeks to invest alongside proven management teams experienced in their local market. Domain provides clients timely transaction evaluations, efficient underwriting timelines and streamlined documentation.


DW Partners, LP ("DW") is a global multi-strategy credit firm managing over $6bn in assets. The partners at DW, all of whom worked at Morgan Stanley together in the early 2000s, founded the fundamental credit investing team at Brevan Howard in 2008 and spun off to form DW in 2009. DW uses a multi-strategy approach to investing across the spectrum of credit and structured finance opportunities, with a 34 person investment team focusing predominantly on credit instruments ranging from distressed and performing corporate credit to real estate-related investments and other asset backed investments, with a focus on risk management and absolute return.


All statements in this press release that are not historical facts should be considered as "forward-looking statements" within the meaning of the "Safe Harbor" provision of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such forward looking statements include but are not limited to statements related to the Company's goals and expectations with respect to its financial results for the current or future periods, including total revenues and adjusted pre-tax profit. Although we believe that our plans, intentions and expectations reflected in, or suggested by, such forward looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. By their nature, forward-looking statements: (i) speak only as of the date they are made, (ii) are not guarantees of future performance or results and (iii) are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Therefore, actual results could differ materially and adversely from those forward looking statements as a result of a variety of factors. Such risks, uncertainties and other factors include, but are not limited to, (1) changes in general and local economic, industry and business conditions and impacts of the sustained homebuilding downturn; (2) adverse weather and other environmental conditions and natural disasters; (3) levels of indebtedness and restrictions on the Company's operations and activities imposed by the agreements governing the Company's outstanding indebtedness; (4) the Company's sources of liquidity; (5) changes in credit ratings; (6) changes in market conditions and seasonality of the Company's business; (7) the availability and cost of suitable land and improved lots; (8) shortages in, and price fluctuations of, raw materials and labor; (9) regional and local economic factors, including dependency on certain sectors of the economy, and employment levels affecting home prices and sales activity in the markets where the Company builds homes; (10) fluctuations in interest rates and the availability of mortgage financing; (11) changes in tax laws affecting the after-tax costs of owning a home; (12) operations through joint ventures with third parties; (13) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes, tax laws and the environment; (14) product liability litigation, warranty claims and claims made by mortgage investors; (15) levels of competition; (16) availability and terms of financing to the Company; (17) successful identification and integration of acquisitions; (18) significant influence of the Company's controlling stockholders; (19) availability of net operating loss carryforwards; (20) utility shortages and outages or rate fluctuations; (21) geopolitical risks, terrorist acts and other acts of war; and (22) certain risks, uncertainties and other factors described in detail in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2014 and subsequent filings with the Securities and Exchange Commission. Except as otherwise required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

CONTACT: Hovnanian Enterprises, Inc.: J. Larry Sorsby Executive Vice President & CFO Jeffrey T. O'Keefe Vice President, Investor Relations 732-747-7800 Domain Real Estate Partners, LLC : DW Partners, LP : Taylor Ingraham/Scott Tagliarino ASC Advisors LLC (203) 299-1230

Source:Hovnanian Enterprises, Inc.;Domain Real Estate Partners, LLC

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