INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES

9 Months Ended

Sep. 30, 2018

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES

NOTE 6. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES

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

Investments in unconsolidated joint ventures and investees consist of the following:

	Percentage ownership as of
	September 30, 2018			September 30, 2017
American Realty Investors, Inc.(1)		0.90	%		0.90	%

(1) Unconsolidated investment in parent company owning 140,000 shares of ARL Common Stock

Our interest in the common stock of ARL in the amount of 0.90% is 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 Company’s proportionate share of earnings or losses.

The following is a summary of the financial position and results of operations from our unconsolidated parent (dollars in thousands):

As of September 30	2018			2017
Real estate, net of accumulated depreciation	$	549		$	14,411
Notes receivable		41,782			39,857
Other assets		64,352			54,703
Notes payable		(6,043	)		(6,618	)
Other liabilities		(30,746	)		(37,184	)
Shareholders’ equity		(69,894	)		(65,169	)
For the Nine Months Ended September 30	2018			2017
Rents and interest and other income	$	5,222		$	4,655
Depreciation		—			(142	)
Operating expenses		(1,941	)		(2,607	)
Gain on land sales		—			1,360
Interest expense		(5,231	)		(4,641	)
Net income/(loss)	$	(1,950	)	$	(1,375	)
Company’s proportionate share of net income/(loss)	$	(18	)	$	(12	)