Builder Hovnanian Enterprises (HOV) announced a home-building joint venture with GTIS Partners Wednesday, giving cash-strapped Hovnanian access to more land.

The partnership plans to design, sell, and deliver homes on about 400 lots in two communities in California and one in Virginia, the companies said in a release.

About $75 million of capital will be invested in the joint venture, with Hovnanian contributing 26% and GTIS Partners covering the remainder. New Jersey-based Hovnanian will manage the day-to-day operations.

The project's total home sales could top $250 million, the companies said.

If unspecified financial targets are met, Hovnanian "will receive a promoted share of the cash returns from the venture," the companies said. No further details were provided.

Similar deals could be in the works. "We are optimistic that we will be able to successfully execute additional partnerships in the future for similar large bulk purchases," Hovnanian Chief Executive Ara Hovnanian said.

Shares of Hovnanian were recently down 4.8% at $4.15.

-By Dawn Wotapka, Dow Jones Newswires; 212-416-2193; dawn.wotapka@dowjones.com
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