Investments in Unconsolidated Entities

6 Months Ended

Jun. 30, 2022

Equity Method Investments and Joint Ventures [Abstract]

As of June 30, 2022, we held equity investments in twelve active homebuilding partnerships or limited liability companies. Our participation in these entities may be as a developer, a builder, or an investment partner. Our ownership percentage varies from 7% to 50%, depending on the investment, with no controlling interest held in any of these investments. During the first quarter of 2022, a reconsideration event under ASC 810 occurred for our Tri Pointe Connect joint venture, which required us to reassess whether the joint venture is a variable interest entity (“VIE”) and, if so, whether the Company is the primary beneficiary. This mortgage financing joint venture was accounted for as an equity-method investment as of December 31, 2021. Based on the reassessment performed during the first quarter of 2022, this joint venture was deemed to be a VIE and the Company was identified as the primary beneficiary of the VIE. For further details, see Note 7, Variable Interest Entities.

Unconsolidated Financial Information

Aggregated assets, liabilities and operating results of the entities we account for as equity-method investments are provided below. Because our ownership interest in these entities varies, a direct relationship does not exist between the information presented below and the amounts that are reflected on our consolidated balance sheets as our investments in unconsolidated entities or on our consolidated statements of operations as equity in income of unconsolidated entities.

Assets and liabilities of unconsolidated entities (in thousands):


	June 30, 2022		December 31, 2021
Assets
Cash	$	40,023	$	35,966
Receivables	11,658		8,359
Real estate inventories	442,847		359,324
Other assets	4,057		534
Total assets	$	498,585	$	404,183
Liabilities and equity
Accounts payable and other liabilities	$	128,851	$	73,675
Company’s equity	131,399		118,095
Outside interests’ equity	238,335		212,413
Total liabilities and equity	$	498,585	$	404,183

Results of operations from unconsolidated entities (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Net sales	$	17,399	$	12,588	$	22,722	$	20,397
Other operating expense	(17,335)		(6,973)		(22,779)		(10,821)
Other loss, net	94		(4)		94		(4)
Net income	$	158	$	5,611	$	37	$	9,572
Company’s equity in income of unconsolidated entities	$	143	$	3,933	$	134	$	6,611