REAL ESTATE AND TANGIBLE WATER ASSETS, NET

12 Months Ended

Dec. 31, 2015

Real Estate and Tangible Water Assets, Net

REAL ESTATE AND TANGIBLE WATER ASSETS, NET

The cost assigned to the various components of real estate and tangible water assets were as follows (in thousands):



	December 31,
	2015		2014
Real estate and improvements held and used, net of accumulated amortization of $11,778 at December 31, 2015 and $10,899 at December 31, 2014	$	9,694	$	10,574
Residential real estate and home construction inventories	362,056		322,938
Other real estate inventories completed or under development	9,971		10,308
Tangible water assets	42,514		42,530
Total real estate and tangible water assets	$	424,235	$	386,350

Amortization of real estate improvements was approximately $879,000 in each of the three years ended December 31, 2015.

Impairment Losses during 2015:

During the year ended December 31, 2015, the Company recorded an impairment loss of $923,000 on real estate located in Kern County, California and owned by UCP reducing the carrying value to $6 million. The loss was reported in the consolidated statement of operations and comprehensive income or loss within impairment loss on intangible and long-lived assets and was included in the results of operations of the real estate operations segment.

During the year ended December 31, 2015, the Company accepted an offer for $3.4 million for real estate owned near Fresno, California. As a result, an impairment loss of $274,000 was recorded that reduced the carrying value of the real estate to the offer price. The real estate is not part of UCP’s results of operations, nor is it included in UCP’s inventory of lots. The loss was reported in the consolidated statement of operations and comprehensive income or loss within impairment loss on intangible and long-lived assets and was included in the results of operations of the real estate operations segment.

Impairment Losses during 2014:

In November 2014, certain water rights applications were denied by the New Mexico State Engineer and as a result, the Company recorded an impairment loss of $3.5 million by writing down the project’s capitalized costs to zero. The loss was reported in the consolidated statement of operations and comprehensive income or loss within impairment loss on intangible and long-lived assets and was included in the results of operations of the water resource and water storage operations segment.

During the year ended December 31, 2014, the Company decided to sell a property “as-is” as opposed to completing development activities as originally planned and as a result, wrote down the carrying value of the asset to the estimated fair value. The Company reduced the carrying value of the real estate balance to $1.4 million by recording an impairment loss of $2.9 million. The loss was reported in the consolidated statement of operations and comprehensive income or loss within impairment loss on intangible and long-lived assets and was included in the results of operations of the real estate operations segment. The real estate is not part of UCP’s results of operations, nor is it included in UCP’s inventory of lots.