Miami-based Lennar Corporation announced last week that it will sell its investment and asset management division, Rialto, to private equity firm Stone Point Capital. This move may be part of Lennar’s strategy to focus solely on homebuilding.

Rialto was created by Lennar after the recession to purchase distressed assets, but buying opportunities have been scarce as real estate prices have risen.

The company had communicated it was looking to sell off the division for months, which the Wall Street Journal reported in October. In the third quarter Rialto reported $49.5 million in revenue, less than one percent of Lennar’s total revenue.

Lennar said it will still retain one segment of Rialto — its Rialto Mortgage Finance business, which it expects to incorporate into its Financial Services business at the beginning of the 2019 fiscal year. Lennar will also retain interests in various Rialto funds, as well as investments in other legacy Rialto assets.

 Lennar reported earnings of $453.2 million in the third quarter or $1.37 per share. The homebuilding industry has struggled amongst rising supply and labor costs, which are placing pressure on its margins. Lennar, reported strong profitability, and earlier this year acquired CalAtlantic to become the largest homebuilder in the country, in a deal worth $9.3 billion.

By Katya Demina