1
 Kaufman & Broad Home Corp. said 
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it formed a $53.4 million limited partnership subsidiary 
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to buy land in California suitable for residential development.
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 The partnership, Kaufman & Broad Land Development Venture Limited Partnership, is a 50-50 joint venture with a trust
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 created by institutional clients of Heitman Advisory Corp., a unit of Heitman Financial Corp., a real estate advisory, management and development company with offices in Chicago and Beverly Hills, Calif.
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 Kaufman & Broad, a home building company, declined to identify the institutional investors.
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 The land 
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to be purchased by the joint venture 
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elaboration-object-attribute-e

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hasn't yet received zoning and other approvals 
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required for development, 
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elaboration-object-attribute-e

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and part of Kaufman & Broad's job will be to obtain such approvals.
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 The partnership runs the risk 
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that it may not get the approvals for development,
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 but in return, it can buy land at wholesale rather than retail prices, 
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which can result in sizable savings, 
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cause

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said Bruce Karatz, president and chief executive officer of Kaufman & Broad.
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 There are really very few companies 
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that have adequate capital to buy properties in a raw state for cash.
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elaboration-object-attribute-e

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 Typically, developers option property, 
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and then 
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once they get the administrative approvals, 
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circumstance-e

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they buy it, 
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said Mr. Karatz, 
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adding 
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that 
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he believes 
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attribution-e

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the joint venture is the first of its kind.
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 We usually operate in that conservative manner. 
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 By setting up the joint venture, 
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Kaufman & Broad can take the more aggressive approach 
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of buying raw land, 
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elaboration-object-attribute-e

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while avoiding the negative impacts to its own balance sheet, 
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Mr. Karatz said.
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 The company is putting up only 10% of the capital, 
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although it is responsible for providing management, planning and processing services to the joint venture.
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 This is one of the best ways 
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to assure a pipeline of land 
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to fuel our growth at a minimum risk to our company, 
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purpose

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Mr. Karatz said. 
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elaboration-object-attribute-e

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