Note 9 - Investments in Unconsolidated Land Development and Homebuilding Joint Ventures

9 Months Ended

Sep. 30, 2014

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments and Joint Ventures Disclosure [Text Block]

9.       Investments in Unconsolidated Land Development and Homebuilding Joint Ventures

The table set forth below summarizes the condensed combined statements of operations for our unconsolidated land development and homebuilding joint ventures that we account for under the equity method:

	Nine Months Ended September 30,
	2014			2013
	(Dollars in thousands)
Revenues	$	31,225		$	24,040
Cost of sales and expenses		(35,943	)		(21,793	)
Income (loss) of unconsolidated joint ventures	$	(4,718	)	$	2,247
Income (loss) from unconsolidated joint ventures reflected in the accompanying condensed consolidated statements of operations	$	(342	)	$	1,249

Income (loss) from unconsolidated joint ventures reflected in the accompanying condensed consolidated statements of operations represents our share of the income (loss) of our unconsolidated land development and homebuilding joint ventures allocated based on the provisions of the underlying joint venture operating agreements. In addition, we defer recognition of our share of income that relates to lots purchased by us from land development joint ventures until we ultimately sell the homes we construct on such lots to third parties. Following such home sales, we account for these earnings as a reduction of the cost basis of the lots purchased from these joint ventures. For the nine months ended September 30, 2014 and 2013, income (loss) from unconsolidated joint ventures was primarily attributable to our share of income (loss) related to our California joint ventures, which was allocated based on the provisions of the underlying joint venture operating agreements.

During each of the nine months ended September 30, 2014 and 2013, all of our investments in unconsolidated joint ventures were reviewed for impairment. Based on the impairment review, no joint venture projects were determined to be impaired for the nine months ended September 30, 2014 or 2013.

The table set forth below summarizes the condensed combined balance sheets for our unconsolidated land development and homebuilding joint ventures that we accounted for under the equity method:

	September 30,		December 31,
	2014		2013
	(Dollars in thousands)
Assets:
Cash	$	32,299	$	37,884
Inventories		191,807		211,929
Other assets		10,307		8,600
Total assets	$	234,413	$	258,413
Liabilities and Equity:
Accounts payable and accrued liabilities	$	17,346	$	20,496
Non-recourse debt		30,000		30,000
Standard Pacific equity		52,759		66,363
Other members' equity		134,308		141,554
Total liabilities and equity	$	234,413	$	258,413
Investments in unconsolidated joint ventures reflected in the accompanying condensed consolidated balance sheets	$	47,922	$	66,054

In some cases our net investment in these unconsolidated joint ventures is not equal to our proportionate share of equity reflected in the table above primarily because of differences between asset impairments that we recorded in prior periods against our joint venture investments and the impairments recorded by the applicable joint venture. As of September 30, 2014 and December 31, 2013, substantially all of our investments in unconsolidated joint ventures were in California. Our investments in unconsolidated joint ventures also included approximately $0.3 million and $5.0 million of homebuilding interest capitalized to investments in unconsolidated joint ventures as of September 30, 2014 and December 31, 2013, respectively, which capitalized interest is not included in the condensed combined balance sheets above.

Our investments in these unconsolidated joint ventures may represent a variable interest in a VIE depending on, among other things, the economic interests of the members of the entity and the contractual terms of the arrangement. We analyze all of our unconsolidated joint ventures under the provisions of ASC 810 to determine whether these entities are deemed to be VIEs, and if so, whether we are the primary beneficiary. As of September 30, 2014, all of our homebuilding and land development joint ventures with unrelated parties were determined under the provisions of ASC 810 to be unconsolidated joint ventures either because they were not deemed to be VIEs and we did not have a controlling interest, or, if they were a VIE, we were not deemed to be the primary beneficiary.