Investments in Unconsolidated Joint Ventures

6 Months Ended

May. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Investments in Unconsolidated Joint Ventures

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. 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, according 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.

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 (losses) until a home sale is closed and title passes to a homebuyer, at which time we account for those earnings (losses) as a reduction (increase) to the cost of purchasing the land from the unconsolidated joint venture. We defer recognition of our share of such unconsolidated joint venture losses only to the extent profits are to be generated from the sale of the home to a homebuyer.

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 typically arises from our deferral of the unconsolidated joint venture’s profits or losses from land sales to us, or other items.

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

	Six Months Ended May 31,						Three Months Ended May 31,
	2015			2014			2015			2014
Revenues	$	6,420		$	6,118		$	3,210		$	—
Construction and land costs	(13,992		)	(3,523		)	(10,249		)	—
Other expense, net	(1,411		)	(2,038		)	(715		)	(908		)
Income (loss)	$	(8,983	)	$	557		$	(7,754	)	$	(908	)

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

	May 31, 2015		November 30, 2014
Assets
Cash	$	14,133	$	23,699
Receivables	5,923		5,106
Inventories	161,015		153,427
Total assets	$	181,071	$	182,232
Liabilities and equity
Accounts payable and other liabilities	$	17,420	$	10,824
Equity	163,651		171,408
Total liabilities and equity	$	181,071	$	182,232

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

	May 31, 2015		November 30, 2014
Number of investments in unconsolidated joint ventures	6		6
Investments in unconsolidated joint ventures	$	77,935	$	79,441
Number of unconsolidated joint venture lots controlled under land option contracts and other similar contracts	454		618

In the first quarter of 2014, we sold our interest in an unconsolidated joint venture in Maryland for $10.1 million, which resulted in a gain of $3.2 million that was included in equity in income of unconsolidated joint ventures in our consolidated statement of operations for the six months ended May 31, 2014. None of our unconsolidated joint ventures had outstanding debt at May 31, 2015 or November 30, 2014.