Investments in Marketable Securities and Unconsolidated Entities

Marketable Securities

During the fourth quarter of fiscal 2014, the Company acquired shares of American Homes 4 Rent (AMH) in exchange for the Company's interest in a real estate investment trust (REIT). The shares represented marketable equity securities with a readily available fair value and were classified as available for sale securities. In March 2015, the Company sold the shares and recorded a loss of $1.8 million, which has been recorded within other expense, net in our unaudited consolidated statements of income. Of this loss, $1.1 million had been previously recorded to other comprehensive loss in prior periods, representing the change in fair value of these securities while held. The proceeds received on the sale of the shares of AMH was recorded within investing activities in our unaudited consolidated financial statements of cash flows. Due to the valuation allowance we established for substantially all of our deferred tax assets, the sale of these securities did not have any income tax impact in any period presented.

Unconsolidated Entities

As of March 31, 2015, we participated in certain land development joint ventures and other unconsolidated entities in which Beazer Homes had less than a controlling interest. The following table presents our investment in these unconsolidated entities, as well as the total equity and outstanding borrowings of these unconsolidated entities as of March 31, 2015 and September 30, 2014:



(In thousands)	March 31, 2015		September 30, 2014
Beazer’s investment in unconsolidated entities	$	10,372	$	13,576
Total equity of unconsolidated entities	36,773		59,336
Total outstanding borrowings of unconsolidated entities	10,537		11,254

For the three and six months ended March 31, 2015 and 2014, there were no impairments related to our investments in these unconsolidated entities. Our equity in income from unconsolidated entity activities is as follows for the periods presented:



	Three Months Ended					Six Months Ended
	March 31,					March 31,
(In thousands)	2015		2014			2015		2014
Equity in income of unconsolidated entities - continuing operations	$	82	$	(17	)	$	224	$	302

South Edge/Inspirada

During the fiscal year ended September 30, 2014, we and the other members of Inspirada received land in exchange for our investments in Inspirada. Also during the fiscal year ended September 30, 2014, we paid $1.0 million to the joint venture related to infrastructure and development costs. We continue to have an obligation for our portion of future infrastructure and other development costs, which are estimated at approximately $5.7 million.

Guarantees

Historically, Beazer and our land development joint venture partners provide varying levels of guarantees of debt and other debt-related obligations for these unconsolidated entities. However, as of March 31, 2015 and September 30, 2014, we had no outstanding guarantees or other debt-related obligations related to our investments in unconsolidated entities.

We and our joint venture partners generally provide unsecured environmental indemnities to land development joint venture project lenders. In each case, we have performed due diligence on potential environmental risks. These indemnities obligate us to reimburse the project lenders for claims related to environmental matters for which they are held responsible. During the three and six months ended March 31, 2015 and 2014, we were not required to make any payments related to environmental indemnities.

In assessing the need to record a liability for the contingent aspect of these guarantees, we consider our historical experience in being required to perform under the guarantees, the fair value of the collateral underlying these guarantees and the financial condition of the applicable unconsolidated entities. In addition, we monitor the fair value of the collateral of these unconsolidated entities to ensure that the related borrowings do not exceed the specified percentage of the value of the property securing the borrowings. We have not recorded a liability for the contingent aspects of any guarantees that we determined were reasonably possible but not probable.