Quarterly report pursuant to Section 13 or 15(d)

Investments in Unconsolidated Entities (Tables)

v2.4.0.6
Investments in Unconsolidated Entities (Tables)
 3 Months Ended
Mar. 31, 2013
Equity Method Investments and Joint Ventures [Abstract]  
Schedule of Guarantor Obligations [Table Text Block]
(In thousands)
At March 31, 2013
 
At December 31, 2012
Repayment guarantees
$
213

 
$
219

Completion guarantees (1)
—

 
—

South Edge guarantee (2)
13,243

 
13,243

Total guarantees
$
13,456

 
$
13,462

 
(1)
As our completion guarantees are typically backed by funding from a third party, we do not believe these guarantees represent a potential cash obligation for us, as they require only non-financial performance.
(2)
As discussed in Note 13, we dispute the enforceability of this guarantee, and ultimate resolution of this matter will be addressed through litigation and/or settlements.
Financial information related to unconsolidated joint ventures, Balance sheets
 
At March 31, 2013
 
At December 31, 2012
Assets:
 
 
 
Cash
$
5,161

 
$
7,650

Real estate
36,584

 
36,626

Other assets
2,688

 
3,478

Total assets
$
44,433

 
$
47,754

Liabilities and equity:
 
 
 
Accounts payable and other liabilities
$
4,330

 
$
4,748

Notes and mortgages payable
13,986

 
14,001

Equity of:
 
 
 
Meritage (1)
8,611

 
9,631

Other
17,506

 
19,374

Total liabilities and equity
$
44,433

 
$
47,754

Financial information related to unconsolidated joint ventures, operations
 
Three Months Ended
 
March 31,
 
2013
 
2012
Revenue
$
6,404

 
$
3,843

Costs and expenses
(2,377
)
 
(2,037
)
Net earnings of unconsolidated entities
$
4,027

 
$
1,806

Meritage’s share of pre-tax earnings (1)(2)(3)
$
2,634

 
$
1,423

 
(1)
Balance represents Meritage’s interest, as reflected in the financial records of the respective joint ventures. This balance may differ from the balance reflected in our consolidated financial statements due to the following reconciling items: (i) timing differences for revenue and distributions recognition, (ii) step-up basis and corresponding amortization, (iii) income deferrals as discussed in Note (3) below and (iv) the cessation of allocation of losses from joint ventures in which we have previously impaired our investment balance to zero and where we have no commitment to fund additional losses.
(2)
The joint venture financial statements above represent the most recent information available to us.
(3)
Our share of pre-tax earnings is recorded in “Earnings from financial services unconsolidated entities and other, net” and “Earnings/(loss) from other unconsolidated entities, net” on our consolidated statements of operations and excludes joint venture profit related to lots we purchased from the joint ventures. Such profit is deferred until homes are delivered by us and title passes to a homebuyer.