the eagle bank loan was retired on july 12 , 2011. on march 7 , 2012 , cascades ii completed the sale of cascades apartments to an affiliate of capreit acquisition corporation ( purchaser ) , a maryland corporation , pursuant to a contract of sale agreement , as amended , dated october 31 , 2011. the cascades ii development was sold for $ 19.35 million . at settlement , the company received net proceeds of approximately $ 4.7 million from the transaction after repayment of the existing loan from cardinal bank secured by the cascades apartments and the retirement of the non-controlling equity investment related to the cascades apartments . upon settlement of existing loan from cardinal bank , the indemnification agreement was terminated and the deferred credit enhancement fees , of which $ 93 were outstanding as of december 31 , 2011 , were settled in full . recent accounting pronouncements in may 2011 , the fasb issued accounting standards update no . 2011-04 , amendments to achieve common fair value measurement and disclosure requirements in u.s. gaap and ifrss ( asu 2011-04 ) , which changes the wording used to describe the requirements in gaap for measuring fair value and for disclosing information about fair value measurements in order to improve 18 consistency in the application and description of fair value between gaap and ifrs . asu 2011-04 clarifies how the concepts of highest and best use and valuation premise in a fair value measurement are relevant only when measuring the fair value of nonfinancial assets and are not relevant when measuring the fair value of financial assets or liabilities . in addition , the guidance expanded the disclosures for the unobservable inputs for level 3 fair value measurements , requiring quantitative information to be disclosed related to ( 1 ) the valuation processes used , ( 2 ) the sensitivity of the fair value measurement to changes in unobservable inputs and the interrelationships between those unobservable inputs , and ( 3 ) use of a nonfinancial asset in a way that differs from the asset 's highest and best use . the revised guidance is effective for interim and annual periods beginning after december 15 , 2011 and early application by public entities is prohibited . we are currently evaluating the potential impact of adopting this guidance on our consolidated financial position and results of operations . critical accounting policies and estimates our consolidated financial statements are prepared in accordance with generally accepted accounting principles , which require us to make certain estimates and judgments that affect the reported amounts of assets and liabilities , the disclosure of contingent assets and liabilities at the date of the financial statements , and the reported amounts of revenues and expenses during the reporting periods . on an ongoing basis , we evaluate our estimates , including those related to the consolidation of variable interest entities , revenue recognition , impairment of real estate held for development and sale , warranty reserve and our environmental liability exposure . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances . actual results may differ materially from these estimates . a summary of significant accounting policies is provided in note 2 to our audited consolidated financial statements . the following section is a summary of certain aspects of those accounting policies that require our most difficult , subjective or complex judgments and estimates . real estate held for development and sale real estate held for development and sale includes land , land development costs , interest and other construction costs . land held for development is stated at cost , or when circumstances or events indicate that the land is impaired , at estimated fair value . land , land development and indirect land development costs are accumulated by specific project and allocated to various units within that project using specific identification and allocation based upon the relative sales value , unit or area methods . direct construction costs are assigned to units based on specific identification . construction costs primarily include direct construction costs and capitalized field overhead . other costs are comprised of fees , capitalized interest and real estate taxes . selling costs are expensed as incurred . if the project is considered held for sale , it is valued at the lower of cost or fair value less estimated selling costs . currently , the company 's eclipse and penderbrook projects meet these criteria . because the project sales are expected to extend over a period of time , the company calculates fair value utilizing a discounted cash flow model as discussed below . for assets held for development , estimated fair value is based on comparable sales of real estate in the normal course of business under existing and anticipated market conditions . the evaluation takes into consideration the current status of the property , various restrictions , carrying costs , costs of disposition and any other circumstances which may affect fair value including management 's plans for the property . a write-down to estimated fair value is recorded when the net carrying value of the property exceeds its estimated undiscounted future cash flows . these evaluations are made on a property-by-property basis whenever events or changes in circumstances indicate that the net book value may not be recoverable . the company has classified its eclipse and penderbrook projects as held for sale as discussed above and accordingly , written the projects down to fair value less costs to sell as determined by discounted cash flow models . discounted cash flow models are dependent upon several subjective factors , primarily estimated average sales prices , estimated sales pace , and the selection of an appropriate discount rate . story_separator_special_tag we consider revenue to be from homebuilding when there is a structure built or being built on the lot when delivered . sales of lots occur , and are included in other revenues , when we sell raw land or finished home sites in advance of any home construction . 21 cost of sales  homebuilding cost of sales  homebuilding for the year ended december 31 , 2011 decreased $ 7.0 million to $ 12.2 million of homebuilding cost of sales , as compared to $ 19.2 million for the year ended december 31 , 2010. the decrease in cost of sales as a percentage of homebuilding revenue for the year ended december 31 , 2011 , as compared to the year ended december 31 , 2010 , is reflective of the impairment realized as well as the result of the significant increase in the warranty reserve during the year ended december 31 , 2010. further , this is a reflection of decreased sales concessions such as the payment of certain buyer closing costs at settlement that do not affect the revenue per sale but do increase the cost of a settled home . cost of sales  other cost of sales  other is principally comprised of operating expenses incurred in generating rental revenue at our rental communities and in the construction services segment . cost of sales  other for the year ended december 31 , 2011 increased by $ 3.8 million to $ 7.8 million , as compared to $ 4.0 million for the year ended december 31 , 2010. this increase is primarily related to the increased activity in the construction services segment . impairments and write-offs although market conditions in the washington , d.c. area have improved , if market conditions deteriorate again , additional adverse changes to these estimates in future periods could result in further material impairment amounts to be recorded . we recorded an impairment charge of $ 1.5 million during the year ended december 31 , 2010 , to properly record our for sale projects at fair market value less costs to sell consistent with the provisions of asc 360. there were no impairment charges recorded during the year ended december 31 , 2011. if the project meets the gaap accounting criteria of held for sale , the project is valued at the lower of cost or fair value less estimated selling costs . at december 31 , 2011 , the eclipse and penderbrook developments met that criterion . the following table summarizes impairment charges and write-offs for the twelve months ended : replace_table_token_5_th selling , general and administrative expenses selling , general and administrative costs for the year ended december 31 , 2011 increased $ 1.8 million to $ 7.4 million as compared to $ 5.6 million for the year ended december 31 , 2010. the increase is primarily attributable to increase in stock compensation expenses of $ 0.9 million , feasibility expenses of $ 0.3 million and an increase in consulting expenses of $ 0.3 million . we had 32 full time and 4 part time employees at december 31 , 2011 versus 26 full time and 1 part time at december 31 , 2010. interest , real estate taxes and indirect costs related to inactive projects interest and real estate taxes incurred relating to the development of lots and parcels are capitalized to real estate held for development and sale during the active development period , which generally commences when borrowings are used to acquire real estate assets and ends when the properties are substantially complete or the property becomes inactive which means that development and construction activities have been suspended indefinitely . interest is capitalized based on the interest rate applicable to specific borrowings or the weighted average of the rates applicable to other borrowings during the period . interest and real estate taxes capitalized to real estate held for development and sale are expensed as a component of cost of sales as related units are sold . when a project becomes inactive , its interest , real estate taxes and indirect production overhead costs are no longer capitalized but rather expensed in the period in which they are incurred . during the twelve months ended december 31 , 2011 and 2010 , all of our projects were determined to be inactive for accounting purposes . the following is a breakdown of the interest , real estate taxes and indirect costs related to inactive projects reported on the statement of operations related to the inactivation of certain real estate projects held for development and sale : replace_table_token_6_th 22 story_separator_special_tag href= `` https : //www.sec.gov/archives/edgar/data/0001299969/000119312512144026/ # toc `` > seasonality and weather our business is affected by seasonality with respect to orders and deliveries . in the market in which we operate , the primary selling season is from january through may as well as september and october . orders in other months typically are lower . in addition , the markets in which we operate are four-season markets that experience significant periods of rain and snow . construction cycles and efforts are often adversely affected by severe weather . inflation inflation can have a significant impact on our business performance and the home building industry in general . rising costs of land , transportation costs , utility costs , materials , labor , overhead , administrative costs and interest rates on floating credit facilities can adversely affect our business performance . in addition , rising costs of certain items , such as lumber , can adversely affect the expected profitability of our backlog . generally , we have been able to recover any increases in costs through increased selling prices . however , there is no assurance we will be able to increase selling prices in the future to cover the effects of inflation and other cost increases . cautionary notes regarding forward-looking statements some of the statements contained in this report include forward-looking statements .

liquidity and capital resources we require capital to operate , to post deposits on new deals , to purchase and develop land , to construct homes , to fund related carrying costs and overhead and to fund various advertising and marketing programs to generate sales . these expenditures include payroll , community engineering , entitlement , architecture , advertising , utilities and interest as well as the construction costs of our homes . our sources of capital include , and will continue to include , funds derived from various secured and unsecured borrowings , cash flow from operations , which includes the sale and delivery of constructed homes , rental apartment projects , finished and raw building lots and the sale of equity and debt securities . several recent events have resulted in an improved financial position for the company . as discussed in notes 9 and 10 , the company entered into a strategic alliance with sunbridge capital management , llc ( sunbridge ) which , among other things , provided for a cash out refinancing for both the eclipse and penderbrook projects . additionally , the company reached a settlement of $ 9.4 million in its balfour lawsuit ( see note 15 ) . finally , on march 7 , 2012 , cascades ii completed the sale of its potomac square apartment for $ 19.35 million resulting in unrestricted net proceeds of approximately $ 4.7 million from the transaction . the company will use the net proceeds from each of these events to support its ongoing business operations and new business initiatives . the company is involved in ongoing discussions with lenders and potential equity investors in an effort to provide additional liquidity to sustain business operations and growth capital to fund various new business opportunities . we are anticipating that through a combination of these discussions , the additional cash from settlement proceeds , the cash generated by our rental operations and the cash generated from settlements at our new communities currently under development that the company will generate sufficient cash to sustain our operations through 2012. credit facilities we have outstanding borrowings with various financial institutions and other lenders that have been used to finance the acquisition , development and construction of real estate property .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources we require capital to operate , to post deposits on new deals , to purchase and develop land , to construct homes , to fund related carrying costs and overhead and to fund various advertising and marketing programs to generate sales . these expenditures include payroll , community engineering , entitlement , architecture , advertising , utilities and interest as well as the construction costs of our homes . our sources of capital include , and will continue to include , funds derived from various secured and unsecured borrowings , cash flow from operations , which includes the sale and delivery of constructed homes , rental apartment projects , finished and raw building lots and the sale of equity and debt securities . several recent events have resulted in an improved financial position for the company . as discussed in notes 9 and 10 , the company entered into a strategic alliance with sunbridge capital management , llc ( sunbridge ) which , among other things , provided for a cash out refinancing for both the eclipse and penderbrook projects . additionally , the company reached a settlement of $ 9.4 million in its balfour lawsuit ( see note 15 ) . finally , on march 7 , 2012 , cascades ii completed the sale of its potomac square apartment for $ 19.35 million resulting in unrestricted net proceeds of approximately $ 4.7 million from the transaction . the company will use the net proceeds from each of these events to support its ongoing business operations and new business initiatives . the company is involved in ongoing discussions with lenders and potential equity investors in an effort to provide additional liquidity to sustain business operations and growth capital to fund various new business opportunities . we are anticipating that through a combination of these discussions , the additional cash from settlement proceeds , the cash generated by our rental operations and the cash generated from settlements at our new communities currently under development that the company will generate sufficient cash to sustain our operations through 2012. credit facilities we have outstanding borrowings with various financial institutions and other lenders that have been used to finance the acquisition , development and construction of real estate property .
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 Suspicious Activity Report : the eagle bank loan was retired on july 12 , 2011. on march 7 , 2012 , cascades ii completed the sale of cascades apartments to an affiliate of capreit acquisition corporation ( purchaser ) , a maryland corporation , pursuant to a contract of sale agreement , as amended , dated october 31 , 2011. the cascades ii development was sold for $ 19.35 million . at settlement , the company received net proceeds of approximately $ 4.7 million from the transaction after repayment of the existing loan from cardinal bank secured by the cascades apartments and the retirement of the non-controlling equity investment related to the cascades apartments . upon settlement of existing loan from cardinal bank , the indemnification agreement was terminated and the deferred credit enhancement fees , of which $ 93 were outstanding as of december 31 , 2011 , were settled in full . recent accounting pronouncements in may 2011 , the fasb issued accounting standards update no . 2011-04 , amendments to achieve common fair value measurement and disclosure requirements in u.s. gaap and ifrss ( asu 2011-04 ) , which changes the wording used to describe the requirements in gaap for measuring fair value and for disclosing information about fair value measurements in order to improve 18 consistency in the application and description of fair value between gaap and ifrs . asu 2011-04 clarifies how the concepts of highest and best use and valuation premise in a fair value measurement are relevant only when measuring the fair value of nonfinancial assets and are not relevant when measuring the fair value of financial assets or liabilities . in addition , the guidance expanded the disclosures for the unobservable inputs for level 3 fair value measurements , requiring quantitative information to be disclosed related to ( 1 ) the valuation processes used , ( 2 ) the sensitivity of the fair value measurement to changes in unobservable inputs and the interrelationships between those unobservable inputs , and ( 3 ) use of a nonfinancial asset in a way that differs from the asset 's highest and best use . the revised guidance is effective for interim and annual periods beginning after december 15 , 2011 and early application by public entities is prohibited . we are currently evaluating the potential impact of adopting this guidance on our consolidated financial position and results of operations . critical accounting policies and estimates our consolidated financial statements are prepared in accordance with generally accepted accounting principles , which require us to make certain estimates and judgments that affect the reported amounts of assets and liabilities , the disclosure of contingent assets and liabilities at the date of the financial statements , and the reported amounts of revenues and expenses during the reporting periods . on an ongoing basis , we evaluate our estimates , including those related to the consolidation of variable interest entities , revenue recognition , impairment of real estate held for development and sale , warranty reserve and our environmental liability exposure . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances . actual results may differ materially from these estimates . a summary of significant accounting policies is provided in note 2 to our audited consolidated financial statements . the following section is a summary of certain aspects of those accounting policies that require our most difficult , subjective or complex judgments and estimates . real estate held for development and sale real estate held for development and sale includes land , land development costs , interest and other construction costs . land held for development is stated at cost , or when circumstances or events indicate that the land is impaired , at estimated fair value . land , land development and indirect land development costs are accumulated by specific project and allocated to various units within that project using specific identification and allocation based upon the relative sales value , unit or area methods . direct construction costs are assigned to units based on specific identification . construction costs primarily include direct construction costs and capitalized field overhead . other costs are comprised of fees , capitalized interest and real estate taxes . selling costs are expensed as incurred . if the project is considered held for sale , it is valued at the lower of cost or fair value less estimated selling costs . currently , the company 's eclipse and penderbrook projects meet these criteria . because the project sales are expected to extend over a period of time , the company calculates fair value utilizing a discounted cash flow model as discussed below . for assets held for development , estimated fair value is based on comparable sales of real estate in the normal course of business under existing and anticipated market conditions . the evaluation takes into consideration the current status of the property , various restrictions , carrying costs , costs of disposition and any other circumstances which may affect fair value including management 's plans for the property . a write-down to estimated fair value is recorded when the net carrying value of the property exceeds its estimated undiscounted future cash flows . these evaluations are made on a property-by-property basis whenever events or changes in circumstances indicate that the net book value may not be recoverable . the company has classified its eclipse and penderbrook projects as held for sale as discussed above and accordingly , written the projects down to fair value less costs to sell as determined by discounted cash flow models . discounted cash flow models are dependent upon several subjective factors , primarily estimated average sales prices , estimated sales pace , and the selection of an appropriate discount rate . story_separator_special_tag we consider revenue to be from homebuilding when there is a structure built or being built on the lot when delivered . sales of lots occur , and are included in other revenues , when we sell raw land or finished home sites in advance of any home construction . 21 cost of sales  homebuilding cost of sales  homebuilding for the year ended december 31 , 2011 decreased $ 7.0 million to $ 12.2 million of homebuilding cost of sales , as compared to $ 19.2 million for the year ended december 31 , 2010. the decrease in cost of sales as a percentage of homebuilding revenue for the year ended december 31 , 2011 , as compared to the year ended december 31 , 2010 , is reflective of the impairment realized as well as the result of the significant increase in the warranty reserve during the year ended december 31 , 2010. further , this is a reflection of decreased sales concessions such as the payment of certain buyer closing costs at settlement that do not affect the revenue per sale but do increase the cost of a settled home . cost of sales  other cost of sales  other is principally comprised of operating expenses incurred in generating rental revenue at our rental communities and in the construction services segment . cost of sales  other for the year ended december 31 , 2011 increased by $ 3.8 million to $ 7.8 million , as compared to $ 4.0 million for the year ended december 31 , 2010. this increase is primarily related to the increased activity in the construction services segment . impairments and write-offs although market conditions in the washington , d.c. area have improved , if market conditions deteriorate again , additional adverse changes to these estimates in future periods could result in further material impairment amounts to be recorded . we recorded an impairment charge of $ 1.5 million during the year ended december 31 , 2010 , to properly record our for sale projects at fair market value less costs to sell consistent with the provisions of asc 360. there were no impairment charges recorded during the year ended december 31 , 2011. if the project meets the gaap accounting criteria of held for sale , the project is valued at the lower of cost or fair value less estimated selling costs . at december 31 , 2011 , the eclipse and penderbrook developments met that criterion . the following table summarizes impairment charges and write-offs for the twelve months ended : replace_table_token_5_th selling , general and administrative expenses selling , general and administrative costs for the year ended december 31 , 2011 increased $ 1.8 million to $ 7.4 million as compared to $ 5.6 million for the year ended december 31 , 2010. the increase is primarily attributable to increase in stock compensation expenses of $ 0.9 million , feasibility expenses of $ 0.3 million and an increase in consulting expenses of $ 0.3 million . we had 32 full time and 4 part time employees at december 31 , 2011 versus 26 full time and 1 part time at december 31 , 2010. interest , real estate taxes and indirect costs related to inactive projects interest and real estate taxes incurred relating to the development of lots and parcels are capitalized to real estate held for development and sale during the active development period , which generally commences when borrowings are used to acquire real estate assets and ends when the properties are substantially complete or the property becomes inactive which means that development and construction activities have been suspended indefinitely . interest is capitalized based on the interest rate applicable to specific borrowings or the weighted average of the rates applicable to other borrowings during the period . interest and real estate taxes capitalized to real estate held for development and sale are expensed as a component of cost of sales as related units are sold . when a project becomes inactive , its interest , real estate taxes and indirect production overhead costs are no longer capitalized but rather expensed in the period in which they are incurred . during the twelve months ended december 31 , 2011 and 2010 , all of our projects were determined to be inactive for accounting purposes . the following is a breakdown of the interest , real estate taxes and indirect costs related to inactive projects reported on the statement of operations related to the inactivation of certain real estate projects held for development and sale : replace_table_token_6_th 22 story_separator_special_tag href= `` https : //www.sec.gov/archives/edgar/data/0001299969/000119312512144026/ # toc `` > seasonality and weather our business is affected by seasonality with respect to orders and deliveries . in the market in which we operate , the primary selling season is from january through may as well as september and october . orders in other months typically are lower . in addition , the markets in which we operate are four-season markets that experience significant periods of rain and snow . construction cycles and efforts are often adversely affected by severe weather . inflation inflation can have a significant impact on our business performance and the home building industry in general . rising costs of land , transportation costs , utility costs , materials , labor , overhead , administrative costs and interest rates on floating credit facilities can adversely affect our business performance . in addition , rising costs of certain items , such as lumber , can adversely affect the expected profitability of our backlog . generally , we have been able to recover any increases in costs through increased selling prices . however , there is no assurance we will be able to increase selling prices in the future to cover the effects of inflation and other cost increases . cautionary notes regarding forward-looking statements some of the statements contained in this report include forward-looking statements .

