Bruce Gross: The primary way is that, that is reduced is in dealing with the assets in the joint venture, which our partner might purchase, we might purchase, we might both purchase or a 3rd party can purchase. That is the primary way that we will deal with the joint venture debt. Once those assets are purchased, there is enough capital to pay down the recourse indebtedness at that point. Less so from transferring it to non-recourse indebtedness although we did refinance some of the recourse indebtedness in the past year. Some of that has been moved to non-recourse going forward. It is more dealing with the assets in the JV, focusing on reducing the number of JVs, and that is how we are going to bring that number down. We have been making a lot of progress already along those lines. We are comfortable we will achieve the goals that we set out and committed to with our banks.
Stuart Miller: This is not a Smoking Mirrors program of moving debt from one bucket to another, each of these ventures is being worked and focused on. Some of the ventures that we have in place have just lost their reason for being. It was that maybe we were sharing risk in equity with a partner, and today because of the shift in the market, the share risk is just gone away. It could be that a venture has moved from a responsibly levered partnership to a highly levered partnership just by the loss in equity. In each of these situations we are sitting down with partners and figuring out the right construction for moving forward. In some instances we have bought land or the land asset from a partnership that what we think is an attractive price, having written-off equity and positioning the venture. In other instances we have sold our equity to a partner who has taken on the debt and moved forward, so in all instances we are looking at fundamental alteration of the partnerships, some of our partnerships are excellently positioned and well there will be trails and tribulations going forward in working through a difficult market condition. They still have properly sized debt and properly positioned partners to be able to make the best of the assets.
Nishu Sood (Deutsche Bank): Could you give details on the 8,300 lots?
Bruce Gross: What we did there is we had 8300 home sites that were controlled for the future, they were longer term takedowns. Strategically what we did is we converted those 8300, which was one transaction, and for a similar dollar amount what we did is we purchased some shorter term home sites that were able to be put in production on a more current basis. The total dollar amount of each of those transactions, the sale and the purchase was in the $20 million range, so it was not significant at all, even though it was highlighted by the media just given that it was picked up shortly after the Morgan Stanley transaction, which had significant dollars involved and about 11,000 home sites. There were two separate transactions, but it was a re-positioning, as we have looked at around the country with our asset base it was not exactly a swap it was more of a re-positioning of assets, where we were more focused on shorter term assets that could be put into production sooner and generate cash flow quicker and to be going out as far, just given the fact that there is more land available as we look forward.
Nishu Sood (Deutsche Bank): How do you reconcile the Morgan Stanley venture in terms of understanding what types of lots were involved in that transaction?
Bruce Gross: The starting point is in our lower priced markets where we typically use rolling lot options like Texas and the Carolinas. There were no home sites that went into the program. These were primarily in markets where land is more expensive, in more of the coastal markets. That is where the geographic breakdown of these 11,000 home sites would split out more appropriately. There were a few end markets like California, as well as Florida and various other coastal markets in particular.
Dan Oppenheim (Banc of America Securities): A lot of the spec homes were sold during the past quarter. How many homes are in construction right now?
Bruce Gross: Homes under construction declined 68% from a year ago; there were 17,000 homes under construction in the fourth quarter of 2006 and 5500 at the end of the fourth quarter of 2007. The homes that were completed unsold have come down considerably as well. The first quarter of 2007, we were about 900 completed homes higher than we ended the year and we ended the year with 762 completed unsold homes.
Stephen East (Pali Capital): You had $500 million on free cash flow before the Morgan Stanley: How would you split that out between homebuilding versus land sales?
Bruce Gross: I do not have that split. We do not split that out on our cash flow statement.
Stephen East (Pali Capital): Is the majority of it from homebuilding?
Bruce Gross: That is a fair assumption.
Stephen East (Pali Capital): How do you relive the inventory?
Diane Bessette: If you look at the accounting rules under FAS 66 which speaks to sales of real estate, we have what is called continuing involvement, and what that means that it is a moment we have option agreement and right the first offer is on all the land and that is not in obligation, it truly as it stated it is an option or related first offer. What will happen is as we decide to exercise, we are not to exercise little the option, the land will then either come of our books, and we will have a sale or it will sale our books and will be building it out. It will be determined on an option-by-option basis and whether we choose to exercise that way or not.
Stephen East (Pali Capital): You wanted to get your balance sheet in a position to take advantage of opportunities that come along. When do you think the markets start presenting those opportunities in a meaningful way?
Stuart Miller: There is still time, there is still reconciliation. The homebuilding world has been ahead of the curve, the land world has been behind, and liquidity in the marketplace in general has stabilized. We are odd officially stabilized land pricing, relative to where it is still going to go and we still have some time before we start to see opportunity. We are not going to compromise our balance sheet today by chasing opportunities as the market is still trying to find the bottom. We are still driven by finding ways to take advantage of down market, as we are in right now, but we are not inclined to further trigger too soon.
Timothy Jones (Wasserman and Associates): Is Deloitte allowing you to take 2005, 2006, and 2007 for your three year base year and that have to take 2008 right now?
Stuart Miller: The literature of 109 discusses the fact that you need to look at whether it is more likely then not that you will be able to realize those benefits. As you look at that and evaluate it, it has been the company''s conclusion and Deloitte''s conclusion that in a cyclical business like ours, as we have looked at three years is a guideline. Based on the cyclicality of your industry and what you have experienced potentially you can end up with a different number then just three year. As we look forward, we would look to include 2008 based on the cyclicality, as we evaluate 109 going forward. We are looking at it over a four-year time period. Looking at one of the components although it is strong indicator with respect to whether or not you have a valuation reserve or not and that is accumulative loss. We look at that at as a four year period based on cyclicality that we have experienced in the industry.
Timothy Jones (Wasserman and Associates): How can you take the tax benefit from the IRS?
Stuart Miller: What we had a lot of focus on this year is taken what was a non-cash charge and as we have concluded transactions, converting inventory to cash, and you could see that from a large reduction in our inventory, we have concluded transactions that which time you realize that differ tax outset and it becomes an Income Tax receivable.
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