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Investments in Unconsolidated Entities
 6 Months Ended
Apr. 30, 2021
Investments in and Advances to Affiliates, Schedule of Investments [Abstract]  
Equity Method Investments and Joint Ventures Disclosure Investments in Unconsolidated Entities
We have investments in various unconsolidated entities and our ownership interest in these investments ranges from 15.8% to 50%. These entities, which are structured as joint ventures, (i) develop land for the joint venture participants and for sale to outside builders (“Land Development Joint Ventures”); (ii) develop for-sale homes (“Home Building Joint Ventures”); (iii) develop luxury for-rent residential apartments, commercial space, and a hotel (“Rental Property Joint Ventures”); and (iv) invest in distressed loans and real estate and provide financing and land banking to residential builders and developers for the acquisition and development of land and home sites (“Gibraltar Joint Ventures”).
The table below provides information as of April 30, 2021, regarding active joint ventures that we are invested in, by joint venture category ($ amounts in thousands):
 Land
Development
Joint Ventures		Home Building
Joint Ventures		Rental Property
Joint Ventures		Gibraltar
Joint Ventures		Total
Number of unconsolidated entities
13328448
Investment in unconsolidated entities$215,465 $24,326 $271,317 $22,487 $533,595 
Number of unconsolidated entities with funding commitments by the Company
6—81 15
Company’s remaining funding commitment to unconsolidated entities
$31,126 $— $29,608 $27,543 $88,277 
Certain joint ventures in which we have investments obtained debt financing to finance a portion of their activities. The table below provides information at April 30, 2021, regarding the debt financing obtained by category ($ amounts in thousands):
 Land
Development
Joint Ventures		Home Building
Joint Ventures		Rental Property
Joint Ventures		Total
Number of joint ventures with debt financing
612532
Aggregate loan commitments$326,753 $3,211 $2,069,244 $2,399,208 
Amounts borrowed under loan commitments
$253,808 $3,211 $1,391,948 $1,648,967 
More specific and/or recent information regarding our investments in, advances to, and future commitments to these entities is provided below.
New Joint Ventures
The table below provides information on joint ventures entered into during the six-months ended April 30, 2021 ($ amounts in thousands):
Land Development Joint VenturesRental Property Joint Ventures
Number of unconsolidated joint ventures entered into during the period43
Investment balance at April 30, 2021$86,200 $43,700 
The table below provides information on joint ventures entered into during the six-months ended April 30, 2020 ($ amounts in thousands):
Land Development Joint VenturesRental Property Joint Ventures
Number of unconsolidated joint ventures entered into during the period— 3 
Investment balance at April 30, 2020$— $31,800 

Results of Operations and Intra-entity Transactions
From time to time, certain of our land development and rental property joint ventures sell assets to unrelated parties or to our joint venture partner. In connection with these sales, we recognized gains of $11.5 million in the three-month period ended April 30, 2021. No similar gains were recognized in the three-month period ended April 30, 2020. In the six-month periods ended April 30, 2021 and 2020, we recognized gains of $17.5 million and $10.7 million, respectively. These gains are included in “Income from unconsolidated entities” in our Condensed Consolidated Statements of Operations and Comprehensive Income.
In the three-month period ended April 30, 2020, we recognized an other-than-temporary impairment charge on an investment in a Home Building Joint Venture of $3.0 million. No similar charges were incurred in the three-month period ended April 30, 2021. In the six-month periods ended April 30, 2021 and 2020, we recognized other-than-temporary impairment charges on our investments in certain Home Building Joint Ventures of $2.1 million and $3.0 million, respectively.
Purchases from unconsolidated entities, principally related to our acquisition of lots from our Land Development Joint Ventures, were $3.5 million and $4.3 million in the three-month periods ended April 30, 2021 and 2020, respectively, and $7.8 million and $7.8 million in the six-month periods ended April 30, 2021 and 2020, respectively. Our share of income from the lots we acquired was insignificant in each period. Sales to unconsolidated entities, which principally involved land sales to our Rental Property Joint Ventures, were $82.6 million and $20.0 million in the three-month periods ended April 30, 2021 and 2020, respectively, and $140.0 million and $46.4 million in the six-month periods ended April 30, 2021 and 2020, respectively. These amounts are included in “Land sales and other revenue” on our Condensed Consolidated Statement of Operations and Comprehensive Income and are generally sold at our land basis.
Guarantees
The unconsolidated entities in which we have investments generally finance their activities with a combination of partner equity and debt financing. In some instances, we have guaranteed debt of unconsolidated entities. These guarantees may include any or all of the following: (i) project completion guarantees, including any cost overruns; (ii) repayment guarantees, generally covering a percentage of the outstanding loan; (iii) carry cost guarantees, which cover costs such as interest, real estate taxes, and insurance; (iv) an environmental indemnity provided to the lender that holds the lender harmless from and against losses arising from the discharge of hazardous materials from the property and non-compliance with applicable environmental laws; and (v) indemnification of the lender from “bad boy acts” of the unconsolidated entity.
In some instances, we and our joint venture partner have provided joint and several guarantees in connection with loans to unconsolidated entities. In these situations, we generally seek to implement a reimbursement agreement with our partner that provides that neither party is responsible for more than its proportionate share or agreed upon share of the guarantee; however, we are not always successful. In addition, if the joint venture partner does not have adequate financial resources to meet its obligations under such a reimbursement agreement, we may be liable for more than our proportionate share.
We believe that, as of April 30, 2021, in the event we become legally obligated to perform under a guarantee of an obligation of an unconsolidated entity due to a triggering event, the collateral in such entity should be sufficient to repay a significant portion of the obligation. If it is not, we and our partners would need to contribute additional capital to the venture.
Information with respect to certain of the Company’s unconsolidated entities’ outstanding debt obligations, loan commitments and our guarantees thereon are as follows ($ amounts in thousands):
April 30, 2021
Loan commitments in the aggregate$1,888,600 
Our maximum estimated exposure under repayment and carry cost guarantees if the full amount of the debt obligations were borrowed$352,900 
Debt obligations borrowed in the aggregate$1,138,400 
Our maximum estimated exposure under repayment and carry cost guarantees of the debt obligations borrowed$259,700 
Estimated fair value of guarantees provided by us related to debt and other obligations$9,200 
Terms of guarantees4 months -
3.6 years
The maximum exposure estimates presented above do not take into account any recoveries from the underlying collateral or any reimbursement from our partners. We have not made payments under any of the outstanding guarantees, nor have we been called upon to do so.
Variable Interest Entities

The table below provide information as of April 30, 2021 and October 31, 2020, regarding our unconsolidated joint venture-related variable interests in VIEs ($ amounts in thousands):
April 30,
2021		October 31,
2020
Number of Joint Venture VIEs that the Company is not the Primary Beneficiary (“PB”)
10 12 
Investment balance in unconsolidated Joint Venture VIEs included in Investments in unconsolidated entities in our Consolidated Balance Sheets$85,700 $63,100 
Our maximum exposure to losses related to loan guarantees and additional commitments provided to unconsolidated Joint Venture VIEs$282,400 $122,100 
Our ownership interest in the above unconsolidated Joint Venture VIEs ranges from 20% to 50%.
The table below provide information as of April 30, 2021 and October 31, 2020, regarding our consolidated joint venture-related variable interests in VIEs ($ amounts in thousands):
Balance Sheet ClassificationApril 30,
2021		October 31,
2020
Number of Joint Venture VIEs that the Company is the PB and consolidates
5 5 
Carrying value of consolidated VIEs assetsReceivables prepaid expenses, and other assets$114,000 $163,000 
Our partners’ interests in consolidated VIEsNoncontrolling interest$41,700 $46,200 
Our ownership interest in the above consolidated Joint Venture VIEs ranges from 50% to 98%.
As shown above, we have concluded we are the PB of certain VIEs due to our controlling financial interest in such ventures as we have the power to direct the activities that most significantly impact the joint ventures’ performance and the obligation to absorb expected losses or receive benefits from the joint ventures. The assets of these VIEs can only be used to settle the obligations of the VIEs. In addition, in certain of the joint ventures, in the event additional contributions are required to be funded to the joint ventures prior to the admission of any additional investor at a future date, we will fund 100% of such contributions, including our partner’s pro rata share, which we expect would be funded through an interest-bearing loan. For other VIEs, we have concluded that we are not the PB because the power to direct the activities of such VIEs that most significantly impact their performance was either shared by us and such VIEs’ other partners or such activities were controlled by our partner. For VIEs where the power to direct significant activities is shared, business plans, budgets, and other major decisions are required to be unanimously approved by all members. Management and other fees earned by us are nominal and believed to be at market rates, and there is no significant economic disproportionality between us and other members.
Joint Venture Condensed Combined Financial Information
The Condensed Balance Sheets, as of the dates indicated, and the Condensed Statements of Operations, for the periods indicated, for the unconsolidated entities in which we have an investment are included below (in thousands):
Condensed Balance Sheets:
 April 30,
2021		October 31,
2020
Cash and cash equivalents$107,721 $109,478 
Inventory736,175 511,000 
Loans receivable, net73,452 78,576 
Rental properties1,483,363 1,244,911 
Rental properties under development688,942 666,386 
Real estate owned6,438 6,752 
Other assets195,618 169,368 
Total assets$3,291,709 $2,786,471 
Debt, net of deferred financing costs$1,644,556 $1,368,065 
Other liabilities207,177 186,817 
Members’ equity1,439,976 1,231,173 
Noncontrolling interest— 416 
Total liabilities and equity$3,291,709 $2,786,471 
Company’s net investment in unconsolidated entities (1)
$533,595 $430,701 
(1)    Our underlying equity in the net assets of the entities exceeded our net investment in unconsolidated entities by $16.4 million and $29.4 million as of April 30, 2021 and October 31, 2020, respectively, and these differences are primarily a result of other than temporary impairments related to our investments in unconsolidated entities; interest capitalized on our investments; the estimated fair value of the guarantees provided to the joint ventures; unrealized gains on our retained joint venture interests; gains recognized from the sale of our ownership interests; and distributions from entities in excess of the carrying amount of our net investment.
Condensed Statements of Operations:
 Three months ended April 30,Six months ended April 30,
 2021202020212020
Revenues$86,422 $79,112 $178,952 $212,282 
Cost of revenues (3)
60,136 46,890 156,859 140,361 
Other expenses (3)
35,081 35,217 70,470 78,170 
Total expenses95,217 82,107 227,329 218,531 
Gain on disposition of loans and real estate owned(209)— (209)— 
Loss from operations(9,004)(2,995)(48,586)(6,249)
Other income (loss)34,385 (84)35,332 529 
Income (loss) before income taxes25,381 (3,079)(13,254)(5,720)
Income tax benefit(152)(287)(1,659)(147)
Net income (loss) including earnings from noncontrolling interests25,533 (2,792)(11,595)(5,573)
Less: loss attributable to noncontrolling interest— — (174)— 
Net income (loss) attributable to controlling interest$25,533 $(2,792)$(11,769)$(5,573)
Company’s equity in earnings (losses) of unconsolidated entities (2)
$10,483 $(4,271)$11,677 $7,870 
(2)    Differences between our equity in earnings of unconsolidated entities and the underlying net income (loss) of the entities are primarily a result of distributions from entities in excess of the carrying amount of our investment; other than temporary impairments related to our investments in unconsolidated entities; recoveries of previously incurred charges; unrealized gains on our retained joint venture interests; gains recognized from the sale of our investment to our joint venture partner; and our share of the entities’ profits related to home sites purchased by us which reduces our cost basis of the home sites acquired.
(3)    Effective October 31, 2020, we reclassified sales commissions paid to third-party brokers from home sales cost of revenues to selling, general and administrative expense. Prior year periods have been reclassified to conform to the 2021 presentation.