Millrose Properties, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Note 1. Description of Business

Millrose Properties, Inc. (“Millrose” and, together with its subsidiaries, the “Company”) is a corporation incorporated under the laws of the State of Maryland on March 19, 2024 and later spun-off (the “Spin-Off”) by Lennar Corporation (“Lennar”) to create an independent, publicly traded company. The Spin-Off was completed on February 7, 2025, at which time Millrose’s Class A common stock was listed on the New York Stock Exchange under the symbol “MRP”.

Prior to the Spin-Off, the operations and financial information that represent the business assets that were spun off to Millrose were wholly owned by and under the common control of Lennar and are collectively referred to as the “Predecessor Millrose Business”. After the Spin-Off, Millrose is an independent company that is externally managed and advised by Kennedy Lewis Land and Residential Advisors LLC (“KL” or the “Manager”), pursuant to a management agreement between Millrose and KL entered into on February 7, 2025 (the “Management Agreement”).

The Company purchases and develops residential land and sells finished homesites to homebuilders by way of option contracts with predetermined costs and takedown schedules. The Company serves as a solution for homebuilders seeking to expand access to finished homesites while implementing an asset-light strategy. The Company’s option contracts provide for the payment of recurring cash option fees in exchange for granting counterparties the right to purchase land that Millrose owns during the development period at predetermined prices and takedown schedules. As Millrose sells fully developed homesites, capital is recycled into future land acquisitions for homebuilders, providing counterparties with durable access to community growth. To a lesser extent, the Company also provides development loans secured by property intended for residential use.

The Company intends to elect to be treated as a real estate investment trust (“REIT”) for U.S. federal income tax purposes beginning with its taxable year ended December 31, 2025. Millrose is a holding company whose operations are conducted primarily through MPH Parent LLC (“MPH Parent”), a Delaware limited liability company and a wholly owned operating subsidiary of Millrose, and other subsidiaries, including Millrose Properties Holdings, LLC (“Millrose Holdings”), a Delaware limited liability company and a wholly owned operating subsidiary of MPH Parent. Millrose and MPH Parent made a joint election to treat MPH Parent as a taxable REIT subsidiary (“TRS”) of Millrose. Accordingly, MPH Parent will be subject to full entity-level taxation in connection with its business operations. Similarly, the Company expects that its other TRSs will be taxable business entities.

Note 2. Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial statements. Accordingly, certain footnotes or other financial information normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted. These condensed consolidated financial statements include, in the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position, results of operations, and cash flows for the periods presented. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements in the Company’s Form 10-K for the year ended December 31, 2025.

The comparative information for the three months ended March 31, 2025 includes results of the Predecessor Millrose Business prior to the Spin-Off completed on February 7, 2025. Amounts presented for the Predecessor Millrose Business have been derived from the accounting records of Lennar and prepared under the legal-entity carve-out method, as described in the Company’s Form 10-K for the year ended December 31, 2025. The condensed consolidated financial statements after the Spin-Off include the accounts of Millrose and its subsidiaries, including Millrose Holdings and other subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Subsequent to the issuance of the Company’s Form 10-Q for the first quarter 2025, the Company corrected its previously issued Statements of Cash Flows presentation for the Sale of homesites under option contracts and other related assets. As a result, the Company has revised the prior-year comparative information presented herein to capture the impact to the first quarter of 2025. The cash flows provided by operating activities have been increased and net cash provided by investing activities have been decreased by $692 million, respectively. Management believes that the amount is immaterial to its previously issued condensed consolidated financial statements.

Segment and Geographic Information

Prior to the Spin-Off, the Predecessor Millrose Business didnot operate as a separate reportable segment. Following the Spin-Off, the Company operates and derives revenue primarily from its portfolio of homesites under option contracts. The Company also earns interest income on development loans secured by residential property.

As of March 31, 2026, the Company’s operations were conducted entirely in the United States with properties geographically located across 30 states. The Chief Executive Officer serves as the Company’s Chief Operating Decision Maker (the “CODM”) and evaluates performance and resource allocation on a portfolio basis. Additionally, the Company does not distinguish its principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company has asingle operating and reportable segment (the “Reporting Segment”) for disclosure purposes in accordance with GAAP.

The CODM evaluates the performance of the Reporting Segment by analyzing the Company's condensed consolidated financial statements. Net income attributable to Millrose, as presented on the Company’s condensed consolidated statements of operations, is the primary metric utilized by the CODM to assess the Reporting Segment’s performance and to allocate resources. Total assets, as presented on the Company’s condensed consolidated balance sheets, is used to measure the Reporting Segment’s assets.

The Company monitors major counterparties to assess potential risks to its financial position. For the three months ended March 31, 2026, the Company derived a substantial portion of its revenues from Lennar, which represented $140.3 million, or 72%, of the Company's total revenues, and 76% of the Company's total option fee revenues.

The Company continuously monitors operations for any changes that may impact segment reporting as required under ASC 280 Segment Reporting. No such changes occurred during the periods presented.

Use of Estimates and Assumptions

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. The allowance for credit losses on development loan receivables and homesites under option contracts is a critical accounting estimate developed using a weighted average remaining maturity (“WARM”) methodology in accordance with ASC 326 Financial Instruments – Credit Losses. This methodology requires significant judgment in determining the annual charge-off rate, expected cash flows, and other qualitative adjustments. Additionally, determining whether option agreements should be accounted for under ASC 842 Leases requires the Company to apply significant judgment in evaluating the elements of control and economic benefits of the related assets.

The Company believes the estimates and assumptions underlying its condensed consolidated financial statements are reasonable and supportable based on the information available as of March 31, 2026. Actual results could differ from those estimates.

Cash

The Company considers all investments with an original maturity of three months or less to be cash and cash equivalents. Cash is recorded at cost, which approximates their fair values due to the short maturity period. As of March 31, 2026, cash was $49.3 millionand consisted of highly liquid deposit accounts. The Company heldno cash equivalents or restricted cash balances as of March 31, 2026.

Homesites Under Option Contracts

The Company enters into option agreements that grant homebuilders the right to direct the planning, use, and development of homesites subject to the option contracts. The Company evaluates its homesite option contracts at inception to determine if they contain a lease as defined under ASC 842. If the counterparty obtains substantially all of the economic benefits from use of the asset and has elements of control of the optioned assets, the Company accounts for homesites under option contracts in accordance with ASC 842. If the purchase options are reasonably certain of being exercised, the Company accounts for option fee contracts as sale-type leases under ASC 842.

Homesites under option contracts are recorded based on the Company's capital funded under the option contracts, which includes the land acquisition costs, qualifying development costs and other directly attributable costs. Option fee income is recognized over the term of the contract using an effective interest yield. Changes in monthly option fees due to reimbursable development costs, changes in takedown timing or volume, or other contractual adjustments are recognized prospectively through an updated effective interest yield over the term of the option contract. When a counterparty completes a takedown and homesites are transferred in accordance with the option contract, the Company derecognizes the related carrying amount from the balance sheet.

The Company evaluates the contractual right to receive future payments under option contracts for expected credit losses in accordance with ASC 326. The Company uses a WARM methodology, which applies an annual loss rate to the estimated remaining life of the related contract balance and is adjusted for expected cash flows and other qualitative factors which include the counterparties' payment performance, delinquencies or defaults since inception, historical charge off rates for residential housing, and cross-collateralization features across certain counterparty arrangements. The Company also considers the credit quality of its most significant counterparties.

See Note 4. Homesites Under Option Contracts for additional information.

Development Loan Income

The Company earns interest income on the outstanding loan balance of development loans secured by residential property. Development loan income is recorded in accordance with ASC 310 Receivables. The Company records the revenue on a monthly basis as the interest is earned. All interest earned is paid-in-kind(“PIK”).

For the three months ended March 31, 2026, development loan income was $9.6 million.

Development Loan Receivables, net

Development loan receivables, net are accounted for in accordance with ASC 310. These amounts include principal amounts due on development loans and the related interest receivable. Development loans are recorded at their amortized cost basis, representing the principal portion and capitalized PIK interest, net of principal payments and the allowance for credit losses.

The Company records an allowance for credit losses in accordance with ASC 326. The Company uses a WARM methodology which applies an annual charge-off rate to the estimated remaining life of development loans, adjusted for expected cash flows. The historical baseline is further adjusted for qualitative factors, including counterparties' consistent payment performance and broader market conditions affecting residential development activity. The Company includes accrued PIK interest in the amortized cost basis of the development loans for purposes of calculating the allowance for credit losses. The Company recorded an allowance for credit losses of$1.0 million as of March 31, 2026 in the condensed consolidated balance sheets as an estimate of potential future losses.

Development loan receivables as of March 31, 2026 and December 31, 2025 were as follows:

The following table summarizes the activity in the Company's development loan receivables, net and the associated allowance for credit losses, which represents the Company's valuation account for these financial assets, for the three months ended March 31, 2026:

Builder Deposits

Builder deposits are option deposit payments received from counterparties under the Company’s option contracts. The Company records a liability for these deposits at the time of the counterparties’ deposit payments. When the counterparties exercise their purchase option and acquire the finished homesite, the builder deposits are applied to the total takedown price owed by the counterparty. The liability is reduced as takedown payments are made and when the corresponding homesites under option contracts are derecognized from the balance sheet. If counterparties do not exercise their purchase options, the deposit is forfeited as per the terms of the option contracts and recorded as income by the Company.

The following roll forward summarizes the change in builder deposits for the three months ended March 31, 2026:

Debt Issuance and Financing Costs

The Company records debt issuance and financing costs in accordance with ASC 835 Interest.

Issuance costs for the DDTL Credit Facility (as defined below) and Senior Notes (as defined below) are recorded as a direct deduction of the carrying value of the debt liability and are classified as debt obligations, net in the Company’s condensed consolidated balance sheets. These costs are amortized to interest expense on a straight-line basis over the contractual life of the debt as it approximates the effective interest method. As of March 31, 2026, issuance costs recorded as a direct deduction of debt, net of accumulated amortization, were $40.8 million, of which $11.4 million related to the DDTL Credit Facility and $29.4 million related to the Senior Notes.

Financing costs for the Revolving Credit Facility (as defined below) are classified as other assets in the Company’s condensed consolidated balance sheets as the costs represent a future economic benefit which provides the Company access to capital over the contractual term. These costs are amortized to interest expense on a straight-line basis over the term of the Revolving Credit Facility as it approximates the effective interest method. As of March 31, 2026, financing costs recorded as other assets, net of accumulated amortization, were $6.1 million.

For additional information, see Note 8. Debt Obligations.

Development Guarantee Holdback Liability

The Company recorded a holdback liability related to a site improvement guarantee (the “Site Improvement Guarantee Amount”) owed to Rausch Coleman Companies, LLC (“Rausch”) pursuant to terms of the transaction documents for the acquisition of the Rausch land assets by the Company (the “Transaction Documents”). The Site Improvement Guarantee Amount is due withinten business days of the date that is the later of (i) two years following February 10, 2025, and (ii) the date on which development of 50% of certain assets subject to the Transaction Documents (the “Guaranteed Assets”) has been completed. The amount to be paid to Rausch pursuant to the Transaction Documents is the Site Improvement Guarantee Amount, less the aggregate amount by which actual development costs exceed the budgeted development costs for the Guaranteed Assets or such lesser amounts as may be designated in writing by Rausch. As of March 31, 2026, the holdback liability was $100 million.

Management Fee Expense

Pursuant to the Management Agreement, the Company pays KL a management fee in an amount equal to 1.25% per annum (0.3125% per quarter) of Tangible Assets, as defined in the Management Agreement (the “Management Fee”). The Management Fee is due and payable quarterly in advance as of the first day of each quarter and is reviewed by the Company's Board of Directors (the “Board”).

Except for certain reimbursable expenses, all expenses incurred by Millrose and its subsidiaries in the ordinary course of business are covered under the Management Fee, including the costs of all administrative and operating functions and systems, office space and office equipment, public company expenses, expenses incurred in maintaining the Company’s REIT status, compensation and fees paid to officers, employees, directors, vendors, consultants, advisors, and other outside professionals. All personnel are employed by KL or an affiliate of KL, and their salaries are paid by KL or the relevant affiliate of KL; therefore the Company does not record personnel-related expenses, including salaries, benefits, and share-based compensation for any employees. All cash compensation and fees paid to the Board are also paid by KL and covered by the Management Fee. The Management Fee does not cover certain offering expenses, rating agency fees, fees incurred for services in connection with extraordinary litigation and mergers and acquisitions and other events outside the Company’s ordinary course of business, and, in certain circumstances, costs associated with the ownership and maintenance of land.

The Management Fee for the three months ended March 31, 2026 and 2025 was $28.2 million and $12.1 million, respectively.

Stock-Based Compensation

On December 17, 2024, the Company’s sole stockholder at the time and its Board adopted the Millrose Properties, Inc. 2024 Omnibus Incentive Plan (the “2024 Incentive Plan”). The 2024 Incentive Plan authorizes the award of stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights, and other stock-based awards to the Company’s employees, officers, directors, consultants and advisors. As of March 31, 2026, there were 60,555 underlying shares of Class A common stock associated with outstanding RSU awards under the 2024 Incentive Plan. As of March 31, 2026,11,559,464 shares of Class A common stock were available for issuance under the 2024 Incentive Plan.

In accordance with ASC 718 Compensation- Stock Compensation, the Company accounts for stock-based compensation based on the grant date fair value and amortizes the costs on a straight-line basis over the vesting terms as stock-based compensation expense and as additional paid-in capital. See Note 12. Stock-Based Compensation for additional information.

Sales, General, and Administrative Expenses from Pre-Spin Period

Sales, general, and administrative expenses from pre-spin period are costs directly attributable to the Predecessor Millrose Business prior to the Spin-Off, and include pre-Spin-Off operating and employee compensation costs for dedicated regional and divisional land teams tasked with acquiring and developing the homesites Lennar transferred to Millrose in the Spin-Off. For the three months ended March 31, 2025, these expenses included an allocation for the period from January 1, 2025 through February 7, 2025 calculated as (i) the average daily expense allocated and recorded for the twelve months ended December 31, 2024, applied to (ii) days in the first quarter 2025 prior to the Spin-Off. Sales, general, and administrative expenses from pre-spin period were $25.0 million for the period of January 1, 2025 through February 7, 2025.

Income Taxes

The Company records income taxes using the asset and liability method set under ASC 740 Accounting for Income Taxes. Deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as net operating loss and tax credit carryforwards as applicable. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the year in which the temporary differences are expected to be recovered or paid. The effect of the change in tax rates is recognized in earnings in the period when the changes are enacted. Interest related to unrecognized tax benefits is recognized in the financial statements as a component of income tax expense.

Deferred tax assets are recognized to the extent that it is more likely than not that they will be realized. The Company reviews the potential realization of deferred tax assets and establishes a valuation allowance to reduce the deferred tax assets if it is determined more likely than not that some portion, or all, of the deferred tax assets will not be realized. The Company considers all available positive and negative evidence, including recent financial performance, actual earnings (losses), future reversals of existing temporary differences, projected future taxable income, and tax planning strategies.

Millrose intends to elect to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), when the Company files a REIT tax election with its federal income tax return for the taxable year ended December 31, 2025. As Millrose qualifies as a REIT, it generally will not be subject to U.S. federal income tax on its net income that it distributes to its stockholders. To maintain its qualification as a REIT, Millrose will be required under the Code to distribute at least 90% of its REIT taxable income (without regard to the deduction for dividends paid and excluding net capital gains) to its stockholders and meet certain other requirements. If the Company fails to maintain its qualification as a REIT in any taxable year, it will then be subject to federal income taxes on its taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the Internal Revenue Service grants Millrose relief under certain statutory provisions. Such an event could have a material adverse effect on its net income and net cash available for distribution to its members.

Millrose intends to elect for its wholly owned subsidiaries MPH Parent and Millrose Holdings as well as its indirectly wholly owned subsidiary RCH Holdings, Inc. to be taxable as TRSs and may form or acquire other direct or indirect wholly owned subsidiaries that will also elect to be taxed as TRSs in the future. TRSs are subject to taxation at regular corporate income tax rates.

See Note 10. Income Taxes for additional information.

Other Income (Expense)

The Company records revenue and expenses that are not directly related to the core operations of the Company as other income (expense). Other income (expense) for the three months ended March 31, 2026 and 2025 was $38.2 million expense and $1.4 million expense, respectively. Other income (expense) for the three months ended March 31, 2026 consisted of $39.2 million of interest expense on the Company’s debt obligations and $0.1 million of other expenses, partially offset by $1.1 million of interest income related to cash balances. Other income (expense) for the three months ended March 31, 2025 consisted of interest expenseof $2.5 million for the Revolving Credit Facility, partially offset by interest income of $1.1 million related to cash balances.

Fair Value Measurements

Certain assets and liabilities are required to be reported at fair value under GAAP. The framework for determining fair value provided by GAAP prioritizes the inputs used in measuring fair value as follows:

•

Level 1: Fair value determined based on quoted prices in active markets for identical assets or liabilities.

•

Level 2: Fair value determined using significant other observable inputs.

•

Level 3: Fair value using significant other unobservable inputs.

As of March 31, 2026, the Company did not measure any assets or liabilities at fair value on a recurring or nonrecurring basis.

Other liabilities approximate their fair value due to their short-term nature. Debt obligations, net approximate their fair value. The Company’s Revolving Credit Facility and DDTL Credit Facility bear interest at variable rates that reset periodically; and therefore, approximates fair value. The Company’s Senior Notes approximate fair value as of the reporting date because the notes were issued at market terms during 2025 and any differences between carrying value and estimated fair value are not expected to be material.

Recent Accounting Standards

In November 2024, the Financial Accounting Standards Board (the “FASB”) issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (“ASU 2024-03”), which requires disclosure of disaggregated information about certain income statement expense line items in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company has elected not to early adopt and is currently evaluating the potential impact of ASU 2024-03 on its financial statements and disclosures.

In November 2025, the FASB issued ASU 2025‑08, Financial Instruments—Credit Losses (Topic 326): Purchased Loans (“ASU 2025‑08”), which amends accounting for certain acquired loans. ASU 2025‑08 expands the “gross‑up” method under ASC 326, previously limited to purchased credit-deteriorated (“PCD”) assets, to include certain purchased seasoned loans, eliminating Day 1 credit loss expense and aligning the treatment with that of PCD assets. The update is effective for interim and annual reporting periods beginning after December 15, 2026, with prospective application; early adoption is permitted. The Company is currently evaluating the potential impact of ASU 2025‑08 on its financial statements and disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”). The amendments clarify scope and presentation guidance in Topic 270, consolidate interim disclosures, and introduce a requirement to disclose events since the end of the most recent annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the potential impact of ASU 2025‑11 on its interim reporting disclosures and does not expect adoption to have a material impact on its financial statements and disclosures.

In December 2025, the FASB issued ASU 2025-12, Codification Improvements (“ASU 2025‑12”), which provides technical corrections, clarifications, and minor improvements to the FASB Accounting Standards Codification without introducing major changes to accounting practice. Among other items, ASU 2025-12 clarifies that lease receivables from sales-type leases are excluded from the enhanced disclosures required by ASU 2022-02-Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. ASU 2025-12 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The Company is currently evaluating the potential impact of ASU 2025‑12 and does not expect adoption to have a material impact on its financial statements and disclosures.

Note 3. Business Transactions

Credit Agreement

On March 25, 2026, the Company amended and restated its credit facility with JPMorgan Chase Bank, N.A. serving as administrative agent for the lenders party thereto. The Credit Agreement (as defined below) includes a new $500 million delayed draw term loan and a $1.335 billion revolving credit facility, on an unsecured basis, replacing the previously secured revolving credit facility. Upon the Effective Date (as defined below), the liens securing the loans under the Company’s prior secured revolving credit facility were released. See Note 8. Debt Obligations for further description of the Credit Agreement.

Note 4. Homesites Under Option Contracts

The Company's option contracts with its counterparties are accounted for under ASC 842 because the Company transfers elements of control of the homesites to the counterparties during the option contract period. Revenues earned from homesites under option contracts are recorded as option fee revenues in the Company's condensed consolidated statements of operations.

The option agreements grant counterparties the exclusive right to acquire homesites owned by the Company at predetermined prices and takedown schedules. Although the Company retains legal title to the land during the option agreement term, the counterparties obtain substantive rights to direct the planning, use, and development of the homesites. The Company has therefore determined that these arrangements are accounted for under ASC 842. Because the Company considers the counterparties’ purchase options to be reasonably certain of exercise, the option contracts are accounted for as sales‑type leases under ASC 842.

The carrying value of homesites under option contracts is recorded based on the Company's capital funded under the option contracts, which includes the land acquisition costs, qualifying development costs and other directly attributable costs incurred on the underlying land. When a counterparty completes a takedown and homesites are transferred in accordance with the option contract, the Company derecognizes the related carrying amount from the balance sheet.

The Company did not recognize selling profit or loss upon commencement of its option contracts because the carrying amount of the underlying homesites approximated consideration allocated to those assets in accordance with ASC 842. For the three months ended March 31, 2026 and 2025, the Company recognized total option fee income related to these option contracts of $185.3 million and $80.1 million, respectively. The aggregate homesites under option contract was $9.2 billion as of March 31, 2026 as compared to $8.9 billion as of December 31, 2025.

Because the Company's option contracts are accounted for as sales-type leases, the resulting asset, representing the Company's right to received future takedown payments and option fees, is considered a contractual right to receive cash. Therefore, the Company evaluates expected credit losses for homesites subject to option contracts in accordance with ASC 326. Expected credit losses are estimated using a WARM methodology, which applies an annual loss rate to the estimated remaining life of the related contract balance and is adjusted for expected cash flows and relevant qualitative factors. Qualitative considerations include the counterparties' consistent payment performance, the absence of delinquencies or defaults since inception, non-refundable option deposits and contractual termination fees, and cross-collateralization features across certain counterparty arrangements. The Company also considers the credit quality of its most significant counterparties. After considering these factors, the Company determined that the risk of loss was immaterial as of March 31, 2026.

The change in homesites under option contracts from December 31, 2025 through March 31, 2026 is as follows:

(1)

Investments include land acquisitions of $0.5 billion and development costs of $0.6 billion during the three months ended March 31, 2026.

Counterparties pay monthly option fees, which may vary over time due to additional capital invested in development, reimbursable costs, takedown timing and volume, or other contractual adjustments. These changes are recognized prospectively through an updated effective interest yield. The Company recognizes income from these arrangements using an effective interest yield over the term of the option contract.

Note 5. Related Party Transactions

The Company is externally managed and advised by KL pursuant to the Management Agreement. KL is considered a related party due to its contractual management relationship with the Company. The Management Fee paid to KL for the three months ended March 31, 2026 and 2025 was $28.2 million and $12.1 million, respectively. There wereno amounts payable to or amounts receivable from KL as of March 31, 2026.

As disclosed in the Company’s Form 10-K for the year ended December 31, 2025, Lennar ceased being a related party as it no longer held an ownership interest or other rights that provide significant influence over the Company's management or operating policies following the completion of its exchange offer on November 28, 2025.

Note 6. Other Assets

Other assets as of March 31, 2026 and December 31, 2025 were as follows:

(1)

Includes deferred financing costs related to the Company’s Revolving Credit Facility as of March 31, 2026 and December 31, 2025.

(2)

Primarily includes net earnest deposits of $4.0 million and due diligence costs related to the Rausch land acquisition of $1.8 million as of March 31, 2026 and December 31, 2025.

(3)

Primarily includes prepaid taxes of $8.2 million and $8.5 million as of March 31, 2026 and December 31, 2025, respectively.

Note 7. Other Liabilities

Other liabilities as of March 31, 2026 and December 31, 2025 were as follows:

(1)

Dividend payable as of March 31, 2026 relates to the dividend declared by the Company on March 23, 2026 and paid on April 15, 2026. Dividend payable as of December 31, 2025 relates to the dividend declared by the Company on December 22, 2025 and paid on January 15, 2026. See Note 11. Stockholders' Equity.

(2)

Loan payable as of March 31, 2026 and December 31, 2025 relates to a lender specific to a community acquired from Lennar.

(3)

Includes accrued interest payable related to the Revolving Credit Facility of $4.7 million and Senior Notes of $12.5 million as of March 31, 2026, and accrued interest payable for Revolving Credit Facility of $1.2 million and Senior Notes of $46.4 million as of December 31, 2025.

(4)

As of March 31, 2026, includes accrued debt issuance costs of $0.1 million, other deposits of $0.1 million, accrued dividend equivalent rights for holders of unvested RSUs granted under the 2024 Incentive Plan of $0.1 million, accrued taxes payable of $0.1 million, and other payables of $0.2 million. As of December 31, 2025, primarily includes accrued debt issuance costs of $0.2 million, other deposits of $0.1 million, and accrued dividend equivalent rights for holders of unvested RSUs granted under the 2024 Incentive Plan of $0.1 million.

Note 8. Debt Obligations

The Company’s outstanding debt obligations as of March 31, 2026 consisted of its Senior Notes, borrowings under the Revolving Credit Facility and DDTL Credit Facility, and purchase money mortgages. Debt obligations as of March 31, 2026 and December 31, 2025 were as follows:

(1)

Debt issuance costs for the Senior Notes and DDTL Credit Facility, net of accumulated amortization.

Revolving Credit Facility and Delayed Draw Term Loan Facility

On March 25, 2026 (the “Effective Date”), the Company entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) with the lenders party thereto, the issuing banks party thereto and JPMorgan Chase Bank, N.A., as administrative agent for the lenders, which amended and restated the Company’s prior secured revolving credit facility entered into on February 7, 2025. The Credit Agreement provides for (i) a four-year revolving credit facility (the “Revolving Credit Facility”) with commitments in an aggregate amount of $1.335 billion, (ii) a delayed draw term loan facility (the “DDTL Credit Facility”) in an aggregate amount of $500 million that may be utilized during the first year following the Effective Date, and (iii) an uncommitted accordion feature that allows the Company to seek additional loan commitments under the Credit Agreement in the future, subject to an aggregate maximum commitment amount of $2.5 billion. Borrowings under the Credit Agreement are subject to compliance with a borrowing base, which is a function of the values from time to time of the properties of the Company and its subsidiaries. The revolving loans and any delayed draw term loans borrowed under the Credit Agreement will mature on March 25, 2030. The Credit Agreement is unsecured. Upon the Effective Date, the liens securing the loans under the Company’s prior secured revolving credit facility were released.

Loans under the Credit Agreement bear interest at the Adjusted Term SOFR Rate (as defined in the Credit Agreement) plus an applicable margin at the per annum rate of (i)2.00%, if the Leverage Ratio (as defined in the Credit Agreement) is less than or equal to 0.30 to 1.00, (ii)2.25% if the Leverage Ratio is greater than 0.30 to 1.00 and less than or equal to 0.40 to 1.00, and (iii)2.50% if the Leverage Ratio is greater than 0.40 to 1.00. At the Company’s option, loans may instead bear interest at the Alternate Base Rate (as defined in the Credit Agreement) plus an applicable margin at the per annum rate of 1.00% lower than the applicable margin for Adjusted Term SOFR Rate loans set forth above, in each case, based upon the Leverage Ratio.

As of the Effective Date, the Company’s obligations under the Credit Agreement are guaranteed by Millrose Properties SPE LLC (“SPE LLC”) and MPSAB, LLC (“MPSAB”), each a directly or indirectly wholly-owned subsidiary of the Company. In certain circumstances, the Credit Agreement requires the Company to cause certain future subsidiaries of the Company that are not Taxable REIT Subsidiaries or SPEs (each as defined in the Credit Agreement) to become guarantors.

The Credit Agreement includes affirmative and negative covenants (as further described in the Credit Agreement) and financial covenants, tested quarterly, consisting of a maximum Leverage Ratio, a minimum interest coverage ratio and a minimum tangible net worth. The Credit Agreement also requires the Company to maintain its status as a REIT.

The loans under the Credit Agreement may be accelerated if an event of default occurs. Events of default include (i) customary events of default and (ii) KL ceasing to be the Company’s manager and the Company failing to appoint a replacement manager reasonably acceptable to the required lenders within 90 days.

For the three months ended March 31, 2026, amounts presented for the Revolving Credit Facility reflect borrowings, interest expense, and interest payments under both the Company’s prior secured revolving credit facility from January 1, 2026 through March 24, 2026 and the Revolving Credit Facility from March 25, 2026 through March 31, 2026. As of March 31, 2026, the Company had $425 million outstanding borrowings under the Revolving Credit Facility. Interest expense under the Revolving Credit Facility for the three months ended March 31, 2026 was $6.0 million, including $5.2 million of interest and $0.8 million of amortized deferred financing fees. Interest payments under the Revolving Credit Facility for the three months ended March 31, 2026 were $0.7 million. The outstanding interest payable as of March 31, 2026 was $4.7 million and is included in other liabilities in the Company’s condensed consolidated balance sheets.

As of March 31, 2026, the Company hadno outstanding borrowings under the DDTL Credit Facility. There wasno interest expense or interest payments under the DDTL Credit Facility for the three months ended March 31, 2026. As of March 31, 2026, issuance costs for the DDTL Credit Facility recorded as a direct deduction of debt were $11.4 million.

Senior Notes

The following senior notes, issued by the Company during the year ended December 31, 2025, were outstanding as of March 31, 2026 (together, the “Senior Notes”):

•

$1.25 billion of 6.375% senior notes due 2030 (the “2030 Notes”), and

•

$750 million of 6.250% senior notes due 2032 (the “2032 Notes”).

The Senior Notes are senior unsecured obligations of the Company and are fully and unconditionally guaranteed by SPE LLC and MPSAB. The Senior Notes bear interest at fixed annual rates of 6.375% and 6.250%, respectively, payable semi-annually in arrears. Interest on the 2030 Notes is payable on February 15 and August 15 of each year, beginning on February 15, 2026. Interest on the 2032 Notes is payable on March 15 and September 15 of each year, beginning on March 15, 2026.

The Senior Notes contain customary restrictive covenants, optional redemption provisions, change-of-control repurchase rights, and customary events of default. The Senior Notes rank (i) pari passu with all existing and future senior unsecured indebtedness, (ii) senior to any future subordinated indebtedness, (iii) effectively subordinated to existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness, and (iv) structurally subordinated to all existing and future indebtedness of subsidiaries that do not guarantee the Senior Notes.

There were no modifications to the Senior Notes during the three months ended March 31, 2026. The Company was in compliance with all applicable covenants and there were no events of default under the indentures governing the Senior Notes.

As of March 31, 2026, the combined carrying amount of the Senior Notes, net of unamortized issuance costs of $29.4 million, was $$1.971 billion. Interest expense related to the Senior Notes for the three months ended March 31, 2026 was $33.1 million, including $$31.6 million of interest and $1.5 million of amortized issuance costs. Interest payments related to the Senior Notes for the three months ended March 31, 2026 were $65.6 million. Interest payable as of March 31, 2026 was $12.5 million and is classified in other liabilities in the Company’s condensed consolidated balance sheets.

Purchase Money Mortgages

During 2025, the Company acquiredtwo land parcels totaling $33 million which were financed through property-level, purchase-money arrangements which are fully indemnified by a counterparty. Both obligations are non-recourse to the Company and are secured solely by the respective underlying properties. The counterparty is responsible for all debt service related to the interest on the purchase money mortgages until their respective maturity dates, at which time the Company intends to enter into an option agreement on these properties with the counterparty.

Principal payments of $29 million are due in 2026, and $4 million are due in 2027. The land acquired under the purchase money mortgages is recorded within homesites under option contracts in the Company's condensed consolidated balance sheets. As of March 31, 2026, the outstanding balance under the purchase money mortgages was $33 million.

Note 9. Commitments and Contingencies

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. Legal costs incurred in connection with loss contingencies, if any, are expensed as incurred. There is no material litigation nor, to management’s knowledge, any material litigation currently threatened against the Company as of March 31, 2026.

As of March 31, 2026, the Company had total future land development commitments of $7.2 billion, of which approximately 75% relate to option contracts with Lennar.

Note 10. Income Taxes

The provision for income taxes was as follows for the three months ended March 31, 2026 and March 31, 2025:

Taxable income generated from certain activities that do not qualify under REIT provisions is earned through the Company's TRSs and is subject to U.S. federal, state, and local income and franchise taxation. The following table reconciles the TRS U.S. federal statutory income tax rate to the TRS effective income tax rate for three months ended March 31, 2026 and March 31, 2025:

(1)

State taxes in California, Florida and New York made up the majority (greater than 50 percent) of the tax effect in this category.

Deferred income taxes represent the net tax effects of temporary differences between the financial statement carrying amounts of certain assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The tax effects of significant temporary differences that give rise to net deferred tax liabilities were as follows:

As of March 31, 2026, the Company had federal and state net operating loss (“NOL”) carryforwards of approximately $116.4 million that may be carried forward indefinitely and do not expire.

A reduction of the carrying amounts of deferred tax assets by a valuation allowance is required if, based on available evidence, it is more likely than not that such assets will not be realized. The Company evaluated its deferred tax assets as of March 31, 2026 and concluded that it is more likely than not that the deferred tax assets will be realized. This assessment considered all available positive and negative evidence, including recent financial performance, actual earnings, future reversals of existing temporary differences, projected future taxable income, and tax planning strategies. As such, a valuation allowance was not recorded against the deferred tax assets, including the NOL, as of March 31, 2026. The Company hadno gross unrecognized tax benefits as of March 31, 2026.

There wereno income taxes paid by the Company during the three months ended March 31, 2026.

Note 11. Stockholders’ Equity

Authorized Capital Stock

As of March 31, 2026, Millrose had, under its Charter, authorized capital stock of (i)450,000,000 shares of common stock, par value $0.01 per share, consisting of 275,000,000 shares of Class A common stock and 175,000,000 shares of Class B common stock, and (ii)50,000,000 shares of preferred stock, par value $0.01 per share.

Common Stock

As of March 31, 2026, Millrose had 166,003,497 shares of common stock outstanding. The Company’s common stock consists of shares of Class A and Class B common stock, each with a par value of $0.01 per share. There wereno issuances, conversions, forfeitures, or repurchases of common stock during the three months ended March 31, 2026.

Preferred Stock

As of March 31, 2026, there wereno shares of preferred stock outstanding.

Dividends

On January 15, 2026, the Company paid a dividend of $0.75 to holders of its Class A common stock and Class B common stock of record as of the close of business on January 5, 2026, as declared by the Board on December 22, 2025.

On March 23, 2026 the Company declared a dividend of $0.76 to holders of its Class A common stock and Class B common stock of record as of the close of business April 3, 2026. This dividend was paid on April 15, 2026. For the dividend paid April 15, 2026, the Company recorded a dividend payable of $126.2 million in other liabilities in the Company’s condensed consolidated balance sheets as of March 31, 2026.

For federal income tax purposes, the Company’s 2026 dividend distribution was characterized entirely as ordinary taxable dividends per share, with no portion treated as capital gain dividends or return of capital.

Securities Authorized for Issuance Under Equity Compensation Plans

As of March 31, 2026,60,555 RSUs had been granted pursuant to the 2024 Incentive Plan. See Note 12. Stock-Based Compensation for additional information.

Additional Paid In Capital

As of March 31, 2026, the Company had additional paid-in capital of approximately $5.9 billion, which largely reflects the cash and land contributed by Lennar at the Spin-Off. Changes in additional paid-in capital during the three months ended March 31, 2026 related to the recognition of stock-based compensation expense and the related dividend equivalent rights associated with the RSUs issued under the Company's 2024 Incentive Plan.

Note 12. Stock-Based Compensation Expense

The Company grants RSUs to its non-employee directors under the 2024 Incentive Plan. RSUs granted on April 3, 2025 vest on the earlier of (x) the first anniversary of the grant date and (y) the date of Millrose’s annual stockholder meeting that next follows the grant date, subject to the applicable Board member's continuous service on the Board. RSUs granted on December 10, 2025 vest on the earlier of (x) April 3, 2026 and (y) the date of Millrose’s first annual stockholder meeting that next follows the grant date, and the remaining half of which vest on the earlier of (x) April 3, 2027 and (y) the date of Millrose’s second annual stockholder meeting following the grant date, in each case, subject to the applicable member of the Board's continuous service on the Board. The Company recognizes stock-based compensation expense on a straight-line basis over the vesting period.

For the three months ended March 31, 2026, the Company recognized $0.7 million of stock-based compensation expense related to RSUs. There was no stock-based compensation expense for the three months ended March 31, 2025. The fair value of nonvested shares is determined based on the trading price of the Company’s Class A common stock on the grant date. The weighted average fair value of unvested shares during the three months ended March 31, 2026 was $29.50 per share. There were no granted, vested, or forfeited awards for the three months ended March 31, 2026. As of March 31, 2026, unrecognized compensation expense related to unvested RSU awards was $0.4 million and is expected to be recognized over a weighted-average period of approximately 0.3 years. On April 3, 2026,44,430 RSUs granted on April 3, 2025 and December 10, 2025 vested pursuant to the vesting terms outlined above.

The RSUs granted under the 2024 Incentive Plan include dividend equivalent rights (“DERs”), which entitle the holder to receive, upon vesting of the related RSUs, cash payments equal to dividends declared on the Company’s Class A common stock during the period between the grant date and the vesting date of the RSUs. The Company accrues the associated DER amounts as dividends are declared, with corresponding amounts recorded as additional paid‑in capital. As of March 31, 2026, the Company accrued approximately $0.1 million related to these DERs.

Note 13. Earnings Per Share

The Company calculates earnings per share (“EPS”) in accordance with ASC 260 Earnings Per Share. Basic EPS is calculated by dividing net income attributable to common stockholders by the weighted number of commons shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if unvested RSUs were to vest and be settled in common stock, calculated using the treasury stock method.

For periods prior to the Spin-Off on February 7, 2025, the Company elected to use the number of shares of common stock issued at the Spin-Off date as the denominator for both basic and diluted EPS, which is an acceptable method under ASC 260 for entities that complete a spin-off within the financial reporting period. For the three months ended March 31, 2025, the pre-spin net loss of $25.0 million for the period from January 1, 2025 through February 7, 2025 is added back to net income for purposes of earnings per share.

The following table presents the computation of basic and diluted EPS for the three months ended March 31, 2026 and 2025:

(1)

Basic weighted average common shares outstanding for the three months ended March 31, 2026 represent the common shares issued at the Spin-Off, which are the common shares outstanding as of March 31, 2026.

(2)

Diluted weighted shares outstanding for the three months ended March 31, 2026 include the incremental dilutive effect of unvested RSUs, calculated using the treasury stock method in accordance with ASC 260. As of March 31, 2026, unvested RSUs outstanding resulted in an aggregate increase of 23,753 diluted shares related to the RSUs granted on April 3, 2025 and December 10, 2025 under the 2024 Incentive Plan. The RSUs were unvested as of March 31, 2026.

Note 14. Subsequent Events

The Company has evaluated subsequent events through the filing of this Form 10-Q and determined that there have been no events that have occurred that require adjustment or disclosure in the financial statements except for the following.

On April 1, 2026, the Company received a payoff of approximately $284 million related to one of its development loans with an unaffiliated third party. The payment settled all outstanding principal, accrued interest, and fees associated with the loan.