Investment In Unconsolidated Subsidiaries And Investees

6 Months Ended

Jun. 30, 2011

Investment In Unconsolidated Subsidiaries And Investees

Investment In Unconsolidated Subsidiaries And Investees

NOTE 4. INVESTMENT IN UNCONSOLIDATED SUBSIDIARIES AND INVESTEES

Investments in unconsolidated subsidiaries, jointly owned companies and other investees in which we have a 20% to 50% interest or otherwise exercise significant influence are carried at cost, adjusted for the Company's proportionate share of their undistributed earnings or losses, via the equity method of accounting. ARL is our parent company and is considered as an unconsolidated subsidiary.

Investments accounted for via the equity method consists of the following:


	Percentage Ownership
	at June 30, 2011			at June 30, 2010
American Realty Investors, Inc.⁽¹⁾		2.09	%		2.47	%
Garden Centura, L.P.⁽²⁾		5.00	%		5.00	%

⁽¹⁾	Unconsolidated subsidiary

⁽²⁾	Other investees

Our interest in the common stock of ARL and our partnership interest in Garden Centura, L.P., in the amount of 2.09% and 5.0%, respectively, are accounted for under the equity method because we exercise significant influence over the operations and financial activities. Accordingly, the investments are carried at cost, adjusted for the companies' proportionate share of earnings or losses. The following is a summary of the financial position and results of operations from our unconsolidated subsidiaries and investees (dollars in thousands):


For the Six Months Ended June 30, 2011	Unconsolidated Subsidiaries		Other Investees		Total
Real estate, net of accumulated depreciation	$	178,689	$	73,280	$	251,969
Notes receivable		23,718		-		23,718
Other assets		188,975		4,485		193,460
Notes payable		(216,643)		(47,989)		(264,632)
Other liabilities		(106,940)		(2,182)		(109,122)
Shareholders' equity/partners capital		(67,799)		(27,594)		(95,393)


Revenue	$	13,156	$	3,638	$	16,794
Depreciation		(901)		(1,571)		(2,472)
Operating expenses		(14,660)		(2,149)		(16,809)
Gain on land sales		15,009		-		15,009
Interest expense		(6,755)		(1,156)		(7,911)

Gain (loss) from continuing operations	$	5,849	$	(1,238)	$	4,611
Income from discontinued operations		-		-		-

Net income (loss)	$	5,849	$	(1,238)	$	4,611

Company's proportionate share of earnings	$	122	$	(62)	$	60


For the Six Months Ended June 30, 2010	Unconsolidated Subsidiaries		Other Investees		Total
Real estate, net of accumulated depreciation	$	243,655	$	75,880	$	319,535
Notes Receivable		41,564		-		41,564
Other assets		165,274		5,709		170,983
Notes payable		(230,991)		(48,231)		(279,222)
Other liabilities		(117,736)		(1,984)		(119,720)
Shareholders equity/partners capital		(101,766)		(31,374)		(133,140)


Rents and interest and other income	$	17,041	$	4,078	$	21,119
Depreciation		(1,194)		(1,556)		(2,750)
Operating expenses		(15,175)		(1,966)		(17,141)
Gain on land sales		1,519		-		1,519
Interest expense		(8,546)		(1,805)		(10,351)

Loss from continuing operations		(6,355)		(1,249)		(7,604)
Income from discontinued operations		5,821		-		5,821

Net loss	$	(534)	$	(1,249)	$	(1,783)

Company's proportionate share of earnings	$	(13)	$	(62)	$	(75)

- Definition

The entire disclosure for equity investment, or group of investments, for which combined disclosure is appropriate, including: (a) the name of each investee and percentage of ownership of common stock, (b) accounting policies for investments in common stock, (c) difference between the amount at which the investment is carried and the amount of underlying equity in net assets and the accounting treatment of the difference, (d) the total fair value of each identified investment for which a market value is available, (e) summarized information as to assets, liabilities, and results of operations of the investees (for investments in unconsolidated subsidiaries, common stock of joint ventures, or other investments using the equity method), and (f) material effects of possible conversions, exercises, or contingent issuances of the investee. Other disclosures include (a) the names of any investee in which the investor owns 20 percent or more of the voting stock and investment is not accounted for using the equity method, and the reasons why not, and (b) the names of any investee in which the investor owns less than 20 percent of the voting stock and the investment is accounted for using the equity method, and the reasons why it is.

+ References+ Details