Derivative Financial Instruments

12 Months Ended

Dec. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

10.

Derivative Instruments

The Company may use derivative financial instruments, including interest swaps, caps, options, floors, and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The Company does not intend to utilize derivatives for speculative transactions or purposes other than mitigation of interest rate risk. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with quality credit ratings. The Company does not anticipate that any of the counterparties will fail to meet their obligations.

Detail on the Company's interest rate derivatives outstanding is as follows:


(in thousands, except number of instruments data)	December 31,
Interest Rate Swaps	2024		2023
Notional amount	$	301,444		294,928
Number of instruments		14		15

Detail on the fair value of the Company's interest rate derivatives is as follows:


(in thousands)	December 31,
Interest rate swaps classified as:	2024			2023
Derivative assets	$	12,781			14,213
Derivative liabilities		(423	)		(1,335	)

Derivatives in an asset position are included within Other assets in the accompanying Consolidated Balance Sheets, while those in a liability position are included within Accounts payable and other liabilities.

These derivative financial instruments are all interest rate swaps, which are designated and qualify as cash flow hedges. The Company does not use derivatives for trading or speculative purposes and, as of December 31, 2024, does not have any derivatives that are not designated as hedges.

The changes in the fair value of derivatives designated and qualifying as cash flow hedges are recorded in Accumulated other comprehensive income ("AOCI") and subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings.

The following table represents the effect of the derivative financial instruments on the accompanying Consolidated Financial Statements:


Location and Amount of Gain (Loss) Recognized in OCI on Derivative								Location and Amount of Loss (Gain) Reclassified from AOCI into Income									Total amounts presented in the Consolidated Statements of Operations in which the effects of cash flow hedges are recorded
	Year ended December 31,								Year ended December 31,									Year ended December 31,
(in thousands)	2024		2023			2022			2024			2023			2022			2024		2023			2022
Interest rate swaps	$	12,523		(2,448	)		20,061	Interest (income) expense, net	$	(8,895	)		(7,536	)		833	Interest expense, net	$	180,119		154,249			146,186
																	Loss (gain) on early extinguishment of debt	$	180		(99	)		—

As of December 31, 2024, the Company expects approximately $2.5 million of accumulated comprehensive income on derivative instruments in AOCI, including the Company's share from its Investments in real estate partnerships, to be reclassified into earnings during the next 12 months.