We evaluate our investments in limited partnerships and similar entities in accordance with applicable consolidation guidance to determine whether each such entity is a VIE. The accounting standards for the consolidation of VIEs require qualitative assessments to determine whether we are the primary beneficiary. The primary beneficiary analysis is based on power and economics. We conclude that we are the primary beneficiary and consolidate the VIE if we have both: (i) the power to direct the activities of the VIE that most significantly influence the VIE's economic performance, and (ii) the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. Significant judgments and assumptions related to these determinations include, but are not limited to, estimates about the current and future fair values and performance of real estate held by these VIEs and general market conditions.

We consolidate Aimco Operating Partnership, a VIE of which Aimco is the primary beneficiary. Aimco, through Aimco Operating Partnership, consolidates all VIEs for which it is the primary beneficiary. Substantially all of the assets and liabilities of Aimco are that of Aimco Operating Partnership.

Aimco Operating Partnership is the primary beneficiary, and therefore consolidates our four VIEs that own interests in real estate. In addition, we have nine unconsolidated VIEs for which we are not the primary beneficiary because we are not their primary decision maker. The nine unconsolidated VIEs include four unconsolidated real estate partnerships that hold four apartment communities in San Diego, California, the Mezzanine Investment, our passive equity investment in IQHQ, our investment in the Edgewater joint venture, and our investments in the DC joint ventures.

Details of our consolidated and unconsolidated VIEs, excluding those of Aimco Operating Partnership, are summarized in the table below as of September 30, 2022, and December 31, 2021, (in thousands, except for VIE count):


	September 30, 2022				December 31, 2021
	Consolidated		Unconsolidated		Consolidated		Unconsolidated
Count of VIEs	4		9		9		6
Assets
Real estate, net	$	210,586	$	—	$	564,909	$	—
Mezzanine investment		—		362,788		—		337,797
Right-of-use lease assets		95,506		—		429,768		—
Unconsolidated real estate partnerships		—		28,958		—		13,005
Other assets, net		—		59,686		43,715		35,773
Liabilities
Deferred tax liabilities		—		—		124,747		—
Accrued liabilities and other		25,515		—		30,519		—
Non-recourse property debt, net		31,904		—		—		—
Construction loans, net		12,237		—		163,570		—
Lease liabilities		98,467		—		435,093		—

The changes in consolidated VIE assets and liabilities from December 31, 2021 to September 30, 2022 in the table above are primarily due to the impact of:

(i) In September 2022, we as lessee received final payment from AIR as lessor, pursuant to the lease termination agreement entered into in June 2022. The leases with respect to four properties were terminated, and we relinquished control of the associated leasehold improvements and underlying land of these four properties. Consequently, we derecognized $86.6 million real estate assets and a $138.4 million construction loan was paid off and derecognized as well. In addition, we derecognized right-of-use

lease assets and lease liabilities of $326.1 million and $337.3 million, respectively, due to the lease modifications described in Note 9.

(ii) In February 2022, we acquired all of the outstanding redeemable non-controlling interests in an entity reported as a consolidated VIE as of December 31, 2021.

We own an interest in four unconsolidated real estate partnerships that hold four apartment communities in San Diego, California. We also own investments in the Edgewater joint venture formed in March 2022 to develop a 2.8-acre site in Miami's Edgewater neighborhood, and the DC joint ventures formed in May 2022 to develop a ground-up phased multifamily community in Bethesda, Maryland. See Note 3 for further information.

Our investment balances of $29.0 million and $13.0 million as of September 30, 2022 and December 31, 2021, respectively, represented our maximum exposure to loss in these unconsolidated VIEs.

AIR owns an interest in a partnership that owns Parkmerced Apartments, of which it is not the primary beneficiary, and under the terms of the Separation Agreement, AIR is obligated to transfer ownership of the subsidiaries that hold this interest to us upon receipt of required third-party consents. Our investment balances of $362.8 million and $337.8 million as of September 30, 2022 and December 31, 2021, respectively, represent our indirect interest in notes receivable through our agreement with AIR and our maximum exposure to loss in this VIE.