UNCONSOLIDATED INVESTMENTS

KW Group has unconsolidated investments through real estate related joint ventures and loan pool participations. The following table details its investments in joint ventures and loan pool participations as of June 30, 2016 and December 31, 2015:



	June 30,		December 31,
(Dollars in millions)	2016		2015
Investments in joint ventures	$	453.2	$	443.6
Investments in loan pool participations	—		1.3
Total	$	453.2	$	444.9

Investments in Joint Ventures

Kennedy Wilson has a number of joint venture interests, generally ranging from 5% to 50%, that were formed to acquire, manage, develop, service and/or sell real estate and invest in loan pools and discounted loan portfolios. Kennedy Wilson has significant influence over these entities, but not control, and accordingly, these investments are accounted for under the equity method.

Joint Venture Holdings

As of June 30, 2016 and December 31, 2015, Kennedy Wilson's investment in joint ventures totaled $453.2 million and $443.6 million, respectively.

The following table details our investments in joint ventures by investment type and geographic location as of June 30, 2016:



(Dollars in millions)	Multifamily		Commercial		Loan		Residential		Other		Total
Western U.S.	$	145.4	$	52.4	$	11.8	$	188.1	$	16.0	$	413.7
Japan	6.9		—		—		—		—		6.9
United Kingdom	—		17.7		—		—		—		17.7
Spain	—		—		—		—		14.9		14.9
Total	$	152.3	$	70.1	$	11.8	$	188.1	$	30.9	$	453.2

The following table details our investments in joint ventures by investment type and geographic location as of December 31, 2015:



(Dollars in millions)	Multifamily		Commercial		Loan		Residential		Other		Total
Western U.S.	$	144.8	$	51.4	$	12.2	$	180.1	$	13.2	$	401.7
Japan	5.8		—		—		—		—		5.8
United Kingdom	—		23.3		—		—		—		23.3
Spain	—		—		—		—		12.8		12.8
Total	$	150.6	$	74.7	$	12.2	$	180.1	$	26.0	$	443.6

Vintage Housing Holdings ("VHH")

During the second quarter of 2015, the Company purchased a 61% noncontrolling interest for $78.7 million in VHH, an existing venture that holds controlling interests in 30 syndicated limited partnerships ("LPs") that own multifamily properties via a traditional low-income tax credit structure in the Western United States. The remaining 39% is held by a non-affiliated entity who is appointed as the manager. Neither party controls VHH, and, accordingly, the Company accounts for its investment under the equity method. As of June 30, 2016 and December 31, 2015, the carrying value in VHH was $83.6 million and $84.3 million, respectively.

The LPs generate cash flow through their controlling interests in entities owning multifamily housing that is predominantly structured with low income housing credits to benefit the LPs. The Company has elected the fair value option on its unconsolidated investment in VHH. During the year, the Company recognized a total of $13.3 million in fair value gains through equity income. The fair values gains were driven by recapitalizations through refinancings, sales to new partnerships, new developments to the portfolio and unrealized developer fees. Since the investment is accounted for under fair value, operating distributions are recorded as equity income. The Company has recognized $3.1 million in equity income related to operating distributions received during the year.

VHH is KW Group's largest joint venture investment; there were no other investments that represented more than 10% of the investment in joint ventures balance as of June 30, 2016 or December 31, 2015.

Contributions to Joint Ventures

During the six months ended June 30, 2016, Kennedy Wilson did not contribute to any new joint ventures. Kennedy Wilson contributed $45.6 million to existing joint ventures during the six months ended June 30, 2016 to fund our share of development projects and for capital expenditures and working capital needs.

Distributions from Joint Ventures and Investments in Loan Pools

During the six months ended June 30, 2016, Kennedy Wilson received $53.1 million in operating and investing distributions from its joint ventures and loan pools. Operating distributions resulted from operating cash flow generated by the joint venture investments. Investing distributions resulted from the refinancing of property level debt and asset sales.

The following table details cash distributions by investment type and geographic location for the six months ended June 30, 2016:



	Multifamily				Commercial				Loan Pools				Residential and Other				Total
(Dollars in millions)	Operating		Investing		Operating		Investing		Operating		Investing		Operating		Investing		Operating		Investing
Western U.S.	$	13.4	$	22.5	$	4.1	$	6.7	$	—	$	—	$	0.3	$	5.3	$	17.8	$	34.5
United Kingdom	—		—		—		—		—		0.7		—		—		—		0.7
Japan	0.1		—		—		—		—		—		—		—		0.1		—
Total	$	13.5	$	22.5	$	4.1	$	6.7	$	—	$	0.7	$	0.3	$	5.3	$	17.9	$	35.2

Consolidation Considerations

The Company determines the appropriate accounting method with respect to all investments that are not VIEs based on the control-based framework (controlled entities are consolidated) provided by the consolidations guidance in FASB ASC Topic 810. The Company accounts for joint ventures where it is deemed that the Company does not have control through the equity method of accounting while entities the Company controls are consolidated in KW Group's financial statements.

Capital Commitments

As of June 30, 2016, Kennedy Wilson had unfulfilled capital commitments totaling $43.2 million to four of its joint ventures. The Company may be called upon to contribute additional capital to joint ventures in satisfaction of such capital commitment obligations.