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MORTGAGE AND OTHER INDEBTEDNESS | 6 Months Ended
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Jun. 30, 2022
Debt Disclosure [Abstract] |
MORTGAGE AND OTHER INDEBTEDNESS | MORTGAGE AND OTHER INDEBTEDNESS The following table summarizes the Company’s indebtedness as of June 30, 2022 and December 31, 2021:
($ in thousands) | June 30, 2022 |  | December 31, 2021
Mortgages payable | $ | 311,818 |  |  | $ | 392,590 |
Senior unsecured notes | 1,924,635 |  |  | 1,924,635 |
Unsecured term loans | 720,000 |  |  | 720,000 |
Revolving line of credit | — |  |  | 55,000 |
| 2,956,453 |  |  | 3,092,225 |
Unamortized discounts and premiums, net | 54,379 |  |  | 69,425 |
Unamortized debt issuance costs, net | (9,662) |  |  | (10,842) |
Total mortgage and other indebtedness, net | $ | 3,001,170 |  |  | $ | 3,150,808 |
Consolidated indebtedness, including weighted average interest rates and weighted average maturities as of June 30, 2022, considering the impact of interest rate swaps, is summarized below:
($ in thousands) | Amount Outstanding |  | Ratio |  | Weighted Average Interest Rate |  | Weighted Average Years to Maturity
Fixed rate debt(1) | $ | 2,772,800 |  |  | 94 | % |  | 3.99 | % |  | 4.2
Variable rate debt(2) | 183,653 |  |  | 6 | % |  | 5.55 | % |  | 3.7
Debt discounts, premiums and issuance costs, net | 44,717 |  |  | N/A |  | N/A |  | N/A
Total | $ | 3,001,170 |  |  | 100 | % |  | 4.09 | % |  | 4.2
(1)Fixed rate debt includes the portion of variable rate debt that has been hedged by interest rate swaps. As of June 30, 2022, $720.0 million in variable rate debt is hedged to a fixed rate for a weighted average of 2.7 years. (2)Variable rate debt includes the portion of fixed rate debt that has been hedged by interest rate swaps. As of June 30, 2022, $155.0 million in fixed rate debt is hedged to a floating rate for a weighted average of 3.2 years. Mortgages Payable The following table summarizes the Company’s mortgages payable:
| June 30, 2022 |  | December 31, 2021
($ in thousands) | Balance |  | Weighted Average Interest Rate |  | Weighted Average Years to Maturity |  | Balance |  | Weighted Average Interest Rate |  | Weighted Average Years to Maturity
Fixed rate mortgages payable(1) | $ | 283,165 |  |  | 4.04 | % |  | 1.5 |  | $ | 363,577 |  |  | 4.13 | % |  | 1.7
Variable rate mortgage payable(2) | 28,653 |  |  | 3.21 | % |  | 1.1 |  | 29,013 |  |  | 1.70 | % |  | 0.1
Total mortgages payable | $ | 311,818 |  |  |  |  |  |  | $ | 392,590 |  |  |  |  |
(1)The fixed rate mortgages had interest rates ranging from 3.75% to 5.73% as of June 30, 2022 and December 31, 2021. (2)On April 1, 2022, the interest rate on the variable rate mortgage switched to the Bloomberg Short Term Bank Yield Index (“BSBY”) plus 160 basis points from LIBOR plus 160 basis points. The one-month BSBY rate was 1.61% as of June 30, 2022. The one-month LIBOR rate was 0.10% as of December 31, 2021. Mortgages payable are secured by certain real estate and, in some cases, by guarantees from the Operating Partnership, are generally due in monthly installments of principal and interest and mature over various terms through 2032. During the six months ended June 30, 2022, we repaid mortgages payable totaling $78.7 million that had a weighted average fixed interest rate of 4.43% and made scheduled principal payments of $2.1 million related to amortizing loans. Unsecured Notes The following table summarizes the Company’s senior unsecured notes and exchangeable senior notes:
|  |  | June 30, 2022 |  | December 31, 2021
($ in thousands) | Maturity Date |  | Balance |  | Interest Rate |  | Balance |  | Interest Rate
Senior notes – 4.23% due 2023 | September 10, 2023 |  | $ | 95,000 |  |  | 4.23 | % |  | $ | 95,000 |  |  | 4.23 | %
Senior notes – 4.58% due 2024(1) | June 30, 2024 |  | 149,635 |  |  | 4.58 | % |  | 149,635 |  |  | 4.58 | %
Senior notes – 4.00% due 2025(2) | March 15, 2025 |  | 350,000 |  |  | 4.00 | % |  | 350,000 |  |  | 4.00 | %
Senior notes – LIBOR + 3.65% due 2025(3) | September 10, 2025 |  | 80,000 |  |  | 5.94 | % |  | 80,000 |  |  | 3.86 | %
Senior notes – 4.08% due 2026(1) | September 30, 2026 |  | 100,000 |  |  | 4.08 | % |  | 100,000 |  |  | 4.08 | %
Senior notes – 4.00% due 2026 | October 1, 2026 |  | 300,000 |  |  | 4.00 | % |  | 300,000 |  |  | 4.00 | %
Senior exchangeable notes – 0.75% due 2027 | April 1, 2027 |  | 175,000 |  |  | 0.75 | % |  | 175,000 |  |  | 0.75 | %
Senior notes – LIBOR + 3.75% due 2027(4) | September 10, 2027 |  | 75,000 |  |  | 6.04 | % |  | 75,000 |  |  | 3.96 | %
Senior notes – 4.24% due 2028(1) | December 28, 2028 |  | 100,000 |  |  | 4.24 | % |  | 100,000 |  |  | 4.24 | %
Senior notes – 4.82% due 2029(1) | June 28, 2029 |  | 100,000 |  |  | 4.82 | % |  | 100,000 |  |  | 4.82 | %
Senior notes – 4.75% due 2030(2) | September 15, 2030 |  | 400,000 |  |  | 4.75 | % |  | 400,000 |  |  | 4.75 | %
Total senior unsecured notes |  |  | $ | 1,924,635 |  |  |  |  | $ | 1,924,635 |  |  |
(1)Private placement notes assumed in connection with the Merger. (2)Publicly placed notes assumed in connection with the Merger. (3)$80,000 of 4.47% senior unsecured notes has been swapped to a variable rate of three-month LIBOR plus 3.65% through September 10, 2025. (4)$75,000 of 4.57% senior unsecured notes has been swapped to a variable rate of three-month LIBOR plus 3.75% through September 10, 2025. Unsecured Term Loans and Revolving Line of Credit The following table summarizes the Company’s term loans and revolving line of credit:
|  |  | June 30, 2022 |  | December 31, 2021
($ in thousands) | Maturity Date |  | Balance |  | Interest Rate |  | Balance |  | Interest Rate
Unsecured term loan due 2023 – fixed rate(1)(2) | November 22, 2023 |  | $ | 200,000 |  |  | 4.10 | % |  | $ | 200,000 |  |  | 4.10 | %
Unsecured term loan due 2024 – fixed rate(1)(3) | July 17, 2024 |  | 120,000 |  |  | 2.88 | % |  | 120,000 |  |  | 2.88 | %
Unsecured term loan due 2025 – fixed rate(4)(5) | October 24, 2025 |  | 250,000 |  |  | 5.09 | % |  | 250,000 |  |  | 5.09 | %
Unsecured term loan due 2026 – fixed rate(1)(6) | July 17, 2026 |  | 150,000 |  |  | 2.97 | % |  | 150,000 |  |  | 2.97 | %
Total unsecured term loans |  |  | $ | 720,000 |  |  |  |  | $ | 720,000 |  |  |
Unsecured credit facility revolving line of credit – variable rate(1)(7) | January 8, 2026 |  | $ | — |  |  | 2.89 | % |  | $ | 55,000 |  |  | 1.20 | %
(1)Unsecured term loans and revolving line of credit assumed in connection with the Merger. (2)$200,000 of LIBOR-based variable rate debt has been swapped to a fixed rate 2.85% plus a credit spread based on a leverage grid ranging from 1.20% to 1.85% through November 22, 2023. The applicable credit spread was 1.25% as of June 30, 2022 and December 31, 2021. (3)$120,000 of LIBOR-based variable rate debt has been swapped to a fixed rate 1.68% plus a credit spread based on a leverage grid ranging from 1.20% to 1.70% through July 17, 2024. The applicable credit spread was 1.20% as of June 30, 2022 and December 31, 2021. Subsequent to June 30, 2022, the Secured Overnight Financing Rate (“SOFR”) replaced LIBOR as the interest reference rate for this term loan. (4)$250,000 of LIBOR-based variable rate debt has been swapped to a fixed rate of 5.09% through October 24, 2025. (5)The maturity date of the term loan may be extended for up to three additional periods of one year at the Operating Partnership’s option, subject to certain conditions. (6)$150,000 of LIBOR-based variable rate debt has been swapped to a fixed rate 1.77% plus a credit spread based on a leverage grid ranging from 1.20% to 1.70% through July 17, 2026. The applicable credit spread was 1.20% as of June 30, 2022 and December 31, 2021. Subsequent to June 30, 2022, SOFR replaced LIBOR as the interest reference rate for this term loan. (7)The revolving line of credit has two six-month extension options that the Company can exercise, at its election, subject to (i) customary representations and warranties, including, but not limited to, the absence of an event of default as defined in the unsecured credit agreement and (ii) payment of an extension fee equal to 0.075% of the revolving line of credit capacity. Unsecured Revolving Credit Facility On October 22, 2021, in connection with the Merger, the Operating Partnership (as successor by merger to RPAI), as borrower, and the Company entered into the First Amendment (the “First Amendment”) to the Credit Agreement (as defined below) with KeyBank National Association (“KeyBank”), as administrative agent, and the lenders party thereto. The First Amendment amends the Sixth Amended and Restated Credit Agreement, dated as of July 8, 2021 (as amended, the “Credit Agreement”), among RPAI, as borrower, KeyBank, as administrative agent, and the lenders from time to time party thereto, which provides for an $850.0 million unsecured revolving credit facility (the “Revolving Facility”) with a scheduled maturity date of January 8, 2026 (which maturity date may be extended for up to two additional periods of six months at the Operating Partnership’s option, subject to certain conditions). Under the Credit Agreement, the Operating Partnership has the option to increase the Revolving Facility to an aggregate committed amount of $1.6 billion upon the Operating Partnership’s request, subject to certain conditions, including obtaining commitments from any one or more lenders, whether or not currently party to the Credit Agreement, to provide such increased amounts. Borrowings under the Revolving Facility bear interest at a rate per annum equal to LIBOR or the alternate base rate plus a margin based on the Operating Partnership’s leverage ratio or credit rating, respectively, plus a facility fee based on the Operating Partnership’s leverage ratio or credit rating, respectively. The Revolving Facility is currently priced on the leverage-based pricing grid. In accordance with the Credit Agreement, the credit spread set forth in the leverage grid resets quarterly based on the Company’s leverage, as calculated at the previous quarter end. The Company may irrevocably elect to convert to the ratings-based pricing grid at any time. As of June 30, 2022, making such an election would have resulted in a lower interest rate; however, the Company had not made the election to convert to the ratings-based pricing grid. The Credit Agreement includes a sustainability metric based on targeted greenhouse gas emission reductions, which results in a reduction of the otherwise applicable interest rate margin by one basis point upon achievement of targets set forth therein. Subsequent to June 30, 2022, SOFR replaced LIBOR as the interest reference rate for the Revolving Facility. The following table summarizes the key terms of the Revolving Facility as of June 30, 2022:
(in thousands) |  |  |  |  |  |  |  | Leverage-Based Pricing |  | Investment Grade Pricing
Credit Agreement |  | Maturity Date |  | Extension Option |  | Extension Fee |  | Credit Spread | Facility Fee |  | Credit Spread | Facility Fee
$850,000 unsecured revolving line of credit |  | 1/8/2026 |  | 2 six-month |  | 0.075% |  | 1.05%–1.50% | 0.15%–0.30% |  | 0.725%–1.40% | 0.125%–0.30%
The Operating Partnership’s ability to borrow under the Credit Agreement is subject to ongoing compliance by the Operating Partnership and its subsidiaries with various restrictive covenants, including with respect to liens, transactions with affiliates, dividends, mergers and asset sales. In addition, the Credit Agreement requires that the Operating Partnership satisfy certain financial covenants, including (i) a maximum leverage ratio; (ii) a minimum fixed charge coverage ratio; (iii) a maximum secured indebtedness ratio; (iv) a maximum unsecured leverage ratio; and (v) a minimum unencumbered interest coverage ratio. As of June 30, 2022, we were in compliance with all such covenants. As of June 30, 2022, we had letters of credit outstanding which totaled $1.5 million, against which no amounts were advanced as of June 30, 2022. Subsequent to June 30, 2022, the Operating Partnership entered into the Second Amendment (the “Second Amendment”) to the Credit Agreement with a syndicate of financial institutions to provide for (i) a $250.0 million increase to the Revolving Facility, resulting in a $1.1 billion unsecured revolving credit facility (the “2022 Revolving Facility”) and (ii) a seven-year $300.0 million unsecured term loan (the “$300M Term Loan”). Under the Second Amendment, the Operating Partnership has the option, subject to certain customary conditions, to increase the 2022 Revolving Facility and/or incur additional term loans in an aggregate amount for all such increases and additional loans of up to $600.0 million, for a total facility amount of up to $2.0 billion. Borrowings under the 2022 Revolving Facility will bear interest at a rate per annum equal to SOFR plus a margin based on the Operating Partnership’s leverage ratio or credit rating, respectively. There were no changes to the credit spreads in the Second Amendment; however, the SOFR rate will also be subject to an additional 0.10% spread adjustment as specified in the Second Amendment. The $300M Term Loan will be priced on a ratings-based pricing grid at a rate of SOFR plus a credit spread ranging from 1.15% to 2.20%. The SOFR rate will also be subject to an additional 0.10% spread adjustment as specified in the Second Amendment. Proceeds from the $300M Term Loan were used to repay the Operating Partnership’s existing $200.0 million unsecured term loan that was scheduled to mature on November 22, 2023 (the “$200M Term Loan”) and for general corporate purposes. In conjunction with these transactions, we (i) designated the interest rate swaps related to the $200M Term Loan to the $300M Term Loan and the interest reference rate will be replaced with term SOFR effective with the next reset date in August 2022 through November 22, 2023; (ii) entered into two forward-starting interest rate swap contracts with notional amounts totaling $200.0 million that swap a floating rate of term SOFR to a fixed rate of 2.37% plus a spread of 1.35% with an effective date of November 22, 2023 through August 1, 2025; and (iii) entered into two agreements to swap a total of $100.0 million of SOFR-based variable rate debt to a fixed rate of 2.66% plus a spread of 1.35% with an effective date of August 1, 2022 through August, 1, 2025. The Operating Partnership is permitted to prepay the $300M Term Loan in whole or in part, at any time, subject to a prepayment fee if prepaid on or before July 29, 2024. Unsecured Term Loans On October 22, 2021, in connection with the Merger, the Operating Partnership (as successor by merger to RPAI) assumed all of RPAI’s outstanding $470.0 million aggregate principal of unsecured term loans (“Unsecured Term Loans”). The Unsecured Term Loans are currently priced on a leverage-based pricing grid. In accordance with the respective term loan agreements, the credit spread set forth in the leverage grid resets quarterly based on the Company’s leverage, as calculated at the previous quarter end. The Company may irrevocably elect to convert to a ratings-based pricing grid at any time. As of June 30, 2022, the Company had not made the election to convert to a ratings-based pricing grid. Subsequent to June 30, 2022, the Company made the election to convert to the ratings-based pricing grid with respect to the $120.0 million and $150.0 million term loans. The following table summarizes the key terms of the Unsecured Term Loans assumed as of June 30, 2022:
(in thousands) Unsecured Term Loans Assumed |  | Maturity Date |  | Leverage-Based Pricing Credit Spread |  | Investment Grade Pricing Credit Spread
$200,000 unsecured term loan due 2023 |  | 11/22/2023 |  | 1.20% – 1.85% |  | 0.85% – 1.65%
$120,000 unsecured term loan due 2024 |  | 7/17/2024 |  | 1.20% – 1.70% |  | 0.80% – 1.65%
$150,000 unsecured term loan due 2026 |  | 7/17/2026 |  | 1.20% – 1.70% |  | 0.75% – 1.60%
Under the agreement related to the $120.0 million and $150.0 million term loans, the Operating Partnership has the option to increase each of the term loans to $250.0 million upon the Operating Partnership’s request, subject to certain conditions, including obtaining commitments from any one or more lenders, whether or not currently party to the term loan agreement, to provide such increased amounts. In addition, under the agreement related to the $200.0 million term loan, the Operating Partnership has the option to increase the term loan to $300.0 million upon the Operating Partnership’s request, subject to certain conditions, including obtaining commitments from any one or more lenders, whether or not currently party to the term loan agreement, to provide such increased amounts. The agreements related to the Unsecured Term Loans assumed in the Merger contain representations, financial and other affirmative and negative covenants and events of default that are substantially similar to those contained in the Credit Agreement. The agreement related to the $150.0 million term loan includes a sustainability metric based on targeted greenhouse gas emission reductions, which results in a reduction of the otherwise applicable interest rate margin by one basis point upon achievement of targets set forth therein. On October 25, 2018, the Operating Partnership entered into a Term Loan Agreement (the “Agreement”) with KeyBank National Association, as Administrative Agent, and the other lenders party thereto, providing for an unsecured term loan facility of up to $250.0 million (the “$250M Term Loan”). The $250M Term Loan ranks pari passu with the Operating Partnership’s existing Revolving Facility and other unsecured indebtedness of the Operating Partnership. The $250M Term Loan has a scheduled maturity date of October 24, 2025, which maturity date may be extended for up to three additional periods of one year at the Operating Partnership’s option, subject to certain conditions. The Operating Partnership has the option to increase the $250M Term Loan to $300.0 million, subject to certain conditions, including obtaining commitments from any one or more lenders, whether or not currently party to the Agreement, to provide such increased amounts. The Operating Partnership is permitted to prepay the $250M Term Loan in whole or in part, at any time, subject to a prepayment fee if prepaid on or before October 25, 2023. Debt Issuance Costs Debt issuance costs are amortized on a straight-line basis over the terms of the respective loan agreements. The following amounts of amortization of debt issuance costs are included as a component of “Interest expense” in the accompanying consolidated statements of operations and comprehensive income:
| Six Months Ended June 30,
($ in thousands) | 2022 |  | 2021
Amortization of debt issuance costs | $ | 1,370 |  |  | $ | 1,230 |
Fair Value of Fixed and Variable Rate Debt As of June 30, 2022, the estimated fair value of fixed rate debt was $2.1 billion compared to the book value of $2.2 billion. The fair value was estimated using Level 2 and 3 inputs with cash flows discounted at current borrowing rates for similar instruments, which ranged from 5.40% to 6.11%. As of June 30, 2022, the estimated fair value of variable rate debt was $749.8 million compared to the book value of $748.8 million. The fair value was estimated using Level 2 and 3 inputs with cash flows discounted at current borrowing rates for similar instruments, which ranged from 2.89% to 3.89%.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI https://asc.fasb.org/topic&trid=2208564 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (h) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (c) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (g) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1E -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (i) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 + Details
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