Investments in Unconsolidated Joint Ventures

We have investments in unconsolidated joint ventures that conduct land acquisition, land development and/or other homebuilding activities in various markets where our homebuilding operations are located. Our partners in these unconsolidated joint ventures are unrelated homebuilders and/or land developers and other real estate entities, or commercial enterprises. These investments are designed primarily to reduce market and development risks and to increase the number of lots we own or control. In some instances, participating in unconsolidated joint ventures has enabled us to acquire and develop land that we might not otherwise have had access to due to a project’s size, financing needs, duration of development or other circumstances. While we consider our participation in unconsolidated joint ventures as potentially beneficial to our homebuilding activities, we do not view such participation as essential.

We typically have obtained rights to acquire portions of the land held by the unconsolidated joint ventures in which we currently participate. When an unconsolidated joint venture sells land to our homebuilding operations, we defer recognition of our share of such unconsolidated joint venture’s earnings until a home sale is closed and title passes to a homebuyer, at which time we account for those earnings as a reduction of the cost of purchasing the land from the unconsolidated joint venture.

We and our unconsolidated joint venture partners make initial and/or ongoing capital contributions to these unconsolidated joint ventures, typically on a pro rata basis, equal to our respective equity interests. The obligations to make capital contributions are governed by each such unconsolidated joint venture’s respective operating agreement and related governing documents.

Each unconsolidated joint venture is obligated to maintain financial statements in accordance with GAAP. We share in the profits and losses of these unconsolidated joint ventures generally in accordance with our respective equity interests. In some instances, we recognize profits and losses related to our investment in an unconsolidated joint venture that differ from our equity interest in the unconsolidated joint venture. This may arise from impairments that we recognize related to our investment that differ from the impairments the unconsolidated joint venture recognizes with respect to the unconsolidated joint venture’s assets; differences between our basis in assets we have transferred to the unconsolidated joint venture and the unconsolidated joint venture’s basis in those assets; our deferral of the unconsolidated joint venture earnings from land sales to us; or other items.

With respect to our investments in unconsolidated joint ventures, our equity in income (loss) of unconsolidated joint ventures included no impairment charges for the nine months ended August 31, 2013 or the nine months ended August 31, 2012.

The following table presents combined condensed information from the statements of operations of our unconsolidated joint ventures (in thousands):



	Nine Months Ended August 31,						Three Months Ended August 31,
	2013			2012			2013			2012
Revenues	$	11,908		$	27,859		$	5,552		$	27,859
Construction and land costs	(7,391		)	(19,303		)	(3,463		)	(19,309		)
Other expenses, net	(3,074		)	(1,189		)	(1,183		)	(442		)
Income	$	1,443		$	7,367		$	906		$	8,108

Combined revenues, construction and land costs, and income from our unconsolidated joint ventures for the three months and nine months ended August 31, 2013 and 2012 primarily reflected land sales completed by an unconsolidated joint venture in Maryland.

The following table presents combined condensed balance sheet information for our unconsolidated joint ventures (in thousands):



	August 31, 2013		November 30, 2012
Assets
Cash	$	22,332	$	29,721
Receivables	7,763		6,104
Inventories	359,180		352,791
Other assets	1,183		1,175
Total assets	$	390,458	$	389,791
Liabilities and equity
Accounts payable and other liabilities	$	85,722	$	88,027
Equity	304,736		301,764
Total liabilities and equity	$	390,458	$	389,791

The following table presents information relating to our investments in unconsolidated joint ventures (dollars in thousands):



	August 31, 2013		November 30, 2012
Number of investments in unconsolidated joint ventures	8		8
Investments in unconsolidated joint ventures	$	126,549	$	123,674

Our unconsolidated joint ventures finance land and inventory investments for a project through a variety of arrangements, and certain of our unconsolidated joint ventures have obtained loans from third-party lenders that are secured by the underlying property and related project assets. However, none of our unconsolidated joint ventures had outstanding debt at August 31, 2013 or November 30, 2012.