6. Investments in Unconsolidated Joint Ventures

Investments in unconsolidated joint ventures represent our ownership interest in real estate development and mortgage lending services, which are not considered VIEs, and are accounted for under the equity method, in accordance with ASC 323, when we have less than a controlling interest and significant influence, or are not the primary beneficiary, as defined in ASC 810. While we have a 51% ownership in Pelican Landing Timeshare Ventures, the noncontrolling interest has substantive participating rights relating to operating decisions of the venture and therefore, we account for our investment under the equity method.

At June 30, 2013 and December 31, 2012, our investments in unconsolidated joint ventures consisted of the following:

		Percentage of Ownership
		June 30,		December 31,
Name of Joint Venture	Description	2013		2012
Pelican Landing Timeshares Ventures (Pelican Landing)	Multi-family timeshare units - Bonita Springs, Florida	51.0	%	51.0	%

Florida Home Finance Group LLC (FHFG)	Mortgage banking operations	0.0	%	49.9	%

In conjunction with our Reorganization and in accordance with ASC 852, Reorganizations (“ASC 852”), we revalued our investments in unconsolidated subsidiaries to fair value, which resulted in our carrying value in Pelican Landing being written down to $0 and our carrying value in FHFG being increased by approximately $2.0 million. These fair values were determined primarily using a discounted cash flow model to value the underling net assets of the respective joint ventures. The Company records its investments in unconsolidated joint ventures in other assets in the accompanying unaudited consolidated balance sheets (Note 5).

The table below presents the Company’s equity in earnings from unconsolidated joint ventures for the three and six months ended June 30, 2013 and 2012, respectively, which is recorded in other income in the accompanying unaudited consolidated statements of operations.

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2013		2012			2013		2012
	(in thousands)					(in thousands)

Equity in (earnings) loss from unconsolidated joint ventures	$	19	$	(98	)	$	41	$	(127	)

Our share of net earnings or losses is based upon our ownership interest. Pelican Landing incurred net losses for the years 2010 through 2012 and for the six months ended June 30, 2013; therefore, in accordance with ASC 323, we have discontinued applying the equity method for our share of the net losses, as Pelican Landing’s return to profitability is not assured. We may be required to make additional cash contributions to the joint ventures to avoid the loss of all or a portion of our interest in such ventures. Although our joint ventures do not have outstanding debt, the partners may agree to incur debt to fund partnership and joint operations in the future.

The basis differences between the carrying value of our investments in each joint venture and the respective equity in the joint venture is primarily attributable to the discontinuation of the equity method for Pelican Landing and the fair value adjustments discussed above. At June 30, 2013 and December 31, 2012, our investment basis in the joint ventures is less than our ownership share of the capital on the partnerships’ books by $5.7 million and $6.1 million, respectively.

In April 2013, the FHFG joint venture was dissolved and liquidated and the Company received a cash payment of approximately $0.6 million, representing the return of its investment in the joint venture. We accounted for the dissolution of our investment in FHFG in accordance with the guidance of ASC 860, Transfers and Servicing (“ASC 860”).

Aggregate condensed financial information of our unconsolidated joint ventures is summarized as follows:

	June 30,		December 31,
	2013		2012
	(in thousands)
Assets
Real estate investments	$	5,117	$	5,285
Other assets	7,083		10,535
Total assets	$	12,200	$	15,820

Liabilities and partners’ capital
Total liabilities	$	1,054	$	2,474
Capital - other partners	5,462		6,553
Capital - the Company	5,684		6,793
Total liabilities and partners’ capital	$	12,200	$	15,820

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2013			2012		2013			2012
	(in thousands)					(in thousands)
Combined results of operations
Revenues	$	858		$	1,731	$	1,284		$	3,322

Net (loss) income	$	(291	)	$	118	$	(879	)	$	(88	)