JOINT VENTURES

UDR has entered into joint ventures with unrelated third parties to acquire real estate assets that are either consolidated and included in real estate owned on our Consolidated Balance Sheets or are accounted for under the equity method of accounting, and are included in "Investment in and advances to unconsolidated joint ventures, net" on our Consolidated Balance Sheets. The Company consolidates an entity in which we own less than 100% but control the joint venture as well as any variable interest entity where we are the primary beneficiary. In addition, the Company consolidates any joint venture in which we are the general partner or managing member and the third party does not have the ability to substantively participate in the decision-making process nor the ability to remove us as general partner or managing member without cause.

UDR’s joint ventures are funded with a combination of debt and equity. Our losses are limited to our investment and except as noted below, the Company does not guarantee any debt, capital payout or other obligations associated with our joint venture portfolio.

Unconsolidated Joint Ventures

The Company recognizes earnings or losses from our investments in unconsolidated joint ventures consisting of our proportionate share of the net earnings or loss of the joint ventures. In addition, we may earn fees for providing management services to the unconsolidated joint ventures.

The following table summarizes the Company’s investment in and advances to unconsolidated joint ventures, net which are accounted for under the equity method of accounting as of March 31, 2013 and December 31, 2012 (dollar amounts in thousands):



Joint Venture	Location of Properties	Number of Properties	Number of Apartment Homes	Investment at						UDR’s Ownership Interest
Joint Venture	Location of Properties	Number of Properties	Number of Apartment Homes	March 31, 2013			December 31, 2012			UDR’s Ownership Interest

Operating:
UDR/MetLife I	Various	14 communities	2,547	$	75,959		$	75,129		13.3	%
		8 land parcels	N/A							4.3	%
UDR/MetLife II	Various	13 communities	2,752	311,005			327,001			50.0	%
Lodge at Stoughton	Stoughton, MA	1 community	240	16,162			16,311			95.0	%
KFH	Washington D.C.	3 communities	660	28,598			29,663			30.0	%
Texas JV	Texas	8 communities	3,359	2,608			3,457			20.0	%

Development:
13th & Market	San Diego, CA	1 community	264	30,514			29,930			95.0	%
Domain College Park	College Park, MD	1 community	256	25,930			25,546			95.0	%
				490,776			507,037

Deferred fees and gains on the sale of depreciable property				(29,379		)	(29,406		)

Total investment in and advances to unconsolidated joint ventures, net				$	461,397		$	477,631

As of March 31, 2013 and December 31, 2012, the Company had deferred fees and deferred profit from the sale of properties to joint ventures of $29.4 million, respectively, which will be recognized through earnings over the weighted average life of the related properties, or upon the disposition of the properties to a third party.

The Company recognized $2.7 million and $3.0 million of management fees during the three months ended March 31, 2013 and 2012, respectively, for our management of the joint ventures. The management fees are classified in “Joint venture management and other fees” in the Consolidated Statements of Operations.

The Company may, in the future, make additional capital contributions to certain of our joint ventures should additional capital contributions be necessary to fund acquisitions and operating shortfalls.

We evaluate our investments in unconsolidated joint ventures when events or changes in circumstances indicate that there may be an other-than-temporary decline in value. We consider various factors to determine if a decrease in the value of the investment is other-than-temporary. The Company did not recognize any other-than-temporary decrease in the value of its investments in unconsolidated joint ventures during the three months ended March 31, 2013 and 2012.

Combined summary financial information relating to all of the unconsolidated joint ventures operations (not just our proportionate share), is presented below for the three months ended March 31, 2013 and 2012 (dollars in thousands):



	Three Months Ended March 31,
	2013		2012

Revenues	$	61,080	$	63,025
Real estate depreciation and amortization	21,778		25,885
Net loss	3,837		8,621
UDR recorded loss from unconsolidated entities	2,802		2,691

Combined summary balance sheets relating to all of the unconsolidated joint ventures (not just our proportionate share) are presented below as of March 31, 2013 and December 31, 2012 (dollars in thousands):



	March 31, 2013		December 31, 2012
Real estate, net	$	3,181,823	$	3,189,814
Total assets	3,248,847		3,266,518
Amount due to UDR	30,310		34,843
Third party debt	1,676,444		1,663,427
Total liabilities	1,740,604		1,747,855
Total equity, inclusive of noncontrolling interest	1,508,243		1,518,663
Equity held by noncontrolling interest	12,490		12,755
UDR’s investment in unconsolidated joint ventures, net	461,397		477,631

Consolidated Joint Ventures

In January 2012, the Company formed a joint venture with an unaffiliated third party to acquire 399 Fremont (land for future development) in San Francisco, California. At closing, UDR owned a noncontrolling interest of 92.5% in the joint venture.The Company’s total investment was $55.5 million, which consists of its initial investment of $37.3 million and an option to acquire its partner’s 7.5% ownership interest in the joint venture. In October 2012, the Company exercised the option and paid $13.5 million, resulting in the consolidation of the joint venture at fair value. In January 2013, the Company subsequently acquired its partner's 7.5% ownership interest for $4.7 million.