Investments in Partnerships and LLCs

We participate in entities with equity interests ranging from 20% to 58.2% for the purpose of acquiring and/or developing land in which we may or may not have a controlling interest or be the primary beneficiary. We determine the method for accounting for our investment at inception or upon a reconsideration event.

Consolidated Investments

During 2009, we entered into two separate agreements with unrelated third parties providing for the formation of two LLCs. We subsequently sold developed, partially developed and undeveloped land to each of the companies for a combination of cash and purchase money notes. We acquired a minority ownership interest in each of the LLCs and participate in the management of each of the LLCs. We also entered into land option contracts with these LLCs. Under such land option contracts, we paid a specified option deposit in consideration for the right, but not the obligation, to purchase developed lots in the future at predetermined prices.

In May 2012, we entered into an agreement with JEN Arizona 4, LLC to form a limited liability company, EM 646, LLC (“EM 646”). We hold a 58.2% interest in the venture, which was organized for the purpose of acquiring, entitling, developing, and distributing specific sections of real property located in Mesa, Arizona. The property was acquired in November 2012 and will be distributed to the partners at cost, once certain entitlements and development activities are completed.

As of December 31, 2013 and 2012, our consolidated balance sheets include $33,997 and $32,659, respectively, in Land and Other Inventories owned by these LLCs.

In January 2012, all of the real property owned by one of our consolidated joint ventures was sold to an unrelated third party. The net gain on this sale of approximately $2,731 is fully recognized and included as a component of net loss on our consolidated statement of operations and comprehensive income (loss). We present the joint venture partner's 60% share of this income, $1,639, on our consolidated statement of operations and comprehensive income (loss) as a component of net income (loss) attributable to non-controlling interests in consolidated entities for the year ended December 31, 2012.

We and our equity partners make initial or ongoing capital contributions to these consolidated entities on a pro rata basis. The obligation to make capital contributions is governed by each consolidated entity’s respective operating agreement.

As of December 31, 2013, these consolidated entities were financed by partner equity and do not have third-party debt. In addition, we have not provided any guarantees to these entities or our equity partners. The assets of our investees can only be used to settle obligations of the investees.

Equity Method Investments

We own non-controlling equity interests ranging from 20% to 50% in entities formed for the purpose of acquiring and/or developing land. We analyze these entities when they are entered into or upon a reconsideration event. These investments are accounted for under the equity method.

We share in the profits and losses of these unconsolidated entities generally in accordance with our ownership interests. We and our equity partners make initial and ongoing capital contributions to these unconsolidated entities on a pro rata basis. The obligation to make capital contributions is governed by each unconsolidated entity’s respective operating agreement. We made contributions totaling $111, $135 and $138 to our unconsolidated entities during 2013, 2012, and 2011, respectively.

The following are the combined condensed balance sheets of the entities we account for under the equity method as of December 31, 2013 and 2012:



	December 31
	2013		2012
Assets:
Cash	$	70	$	53
Land and other inventory	6,131		6,126
Other assets	5		6
Total assets	$	6,206	$	6,185
Liabilities and Partners’ Capital:
Accounts payable and accrued liabilities	$	80	$	83
Partners’ capital of:
AV Homes	1,230		1,220
Equity partners	4,896		4,882
Total liabilities and partners’ capital	$	6,206	$	6,185

The following are the combined condensed statements of operations of these entities for the years ended December 31:



	2013			2012		2011
Revenues	$	—		$	1,849	$	6,081
Costs and expenses	258			1,193		5,768
Net income (loss) from unconsolidated entities	$	(258	)	$	656	$	313
AV Homes' share of income (loss) from unconsolidated entities	$	(101	)	$	259	$	(398	)