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Corporate Indebtedness | 6 Months Ended
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Jun. 30, 2018
Debt Disclosure [Abstract] |
Corporate Indebtedness | Mortgages and Other Loans Payable The first mortgages and other loans payable collateralized by the respective properties and assignment of leases or debt investments at June 30, 2018 and December 31, 2017, respectively, were as follows (amounts in thousands):
Property |  | Maturity Date |  | Interest Rate (1) |  | June 30, 2018 |  | December 31, 2017
Fixed Rate Debt: |  |  |  |  |  |  |  |  |
One Madison Avenue |  | May 2020 |  |  | 5.91 | % |  | $ | 469,564 |  |  | $ | 486,153 |
762 Madison Avenue |  | February 2022 |  |  | 5.00 | % |  | 771 |  |  | 771 |
100 Church Street |  | July 2022 |  |  | 4.68 | % |  | 215,223 |  |  | 217,273 |
420 Lexington Avenue |  | October 2024 |  |  | 3.99 | % |  | 300,000 |  |  | 300,000 |
400 East 58th Street (2) |  | November 2026 |  |  | 3.00 | % |  | 40,000 |  |  | 40,000 |
Landmark Square |  | January 2027 |  |  | 4.90 | % |  | 100,000 |  |  | 100,000 |
485 Lexington Avenue |  | February 2027 |  |  | 4.25 | % |  | 450,000 |  |  | 450,000 |
1080 Amsterdam (3) |  | February 2027 |  |  | 3.58 | % |  | 36,138 |  |  | 36,363 |
315 West 33rd Street |  | February 2027 |  |  | 4.17 | % |  | 250,000 |  |  | 250,000 |
919 Third Avenue (4) |  |  |  |  |  |  | — |  |  | 500,000 |
Unsecured Loan (5) |  |  |  |  |  |  | — |  |  | 16,000 |
Series J Preferred Units (6) |  |  |  |  |  |  | — |  |  | 4,000 |
Total fixed rate debt |  |  |  |  |  |  | $ | 1,861,696 |  |  | $ | 2,400,560 |
Floating Rate Debt: |  |  |  |  |  |  |  |  |
719 Seventh Avenue |  | February 2019 |  | L+ | 3.05 | % |  | $ | 44,000 |  |  | $ | 41,622 |
183, 187 Broadway & 5-7 Dey Street (7) |  | May 2019 |  | L+ | 2.70 | % |  | 58,000 |  |  | 58,000 |
2017 Master Repurchase Agreement (8) |  | June 2019 |  | L+ | 2.34 | % |  | 300,000 |  |  | 90,809 |
220 East 42nd Street |  | October 2020 |  | L+ | 1.60 | % |  | 275,000 |  |  | 275,000 |
Total floating rate debt |  |  |  |  |  |  | $ | 677,000 |  |  | $ | 465,431 |
Total fixed rate and floating rate debt |  |  |  |  |  |  | $ | 2,538,696 |  |  | $ | 2,865,991 |
Mortgages reclassed to liabilities related to assets held for sale |  |  |  |  |  |  | — |  |  | — |
Total mortgages and other loans payable |  |  |  |  |  |  | $ | 2,538,696 |  |  | $ | 2,865,991 |
Deferred financing costs, net of amortization |  |  |  |  |  |  | (21,599 | ) |  | (28,709 | )
Total mortgages and other loans payable, net |  |  |  |  |  |  | $ | 2,517,097 |  |  | $ | 2,837,282 |
(1) | Interest rate as of June 30, 2018, taking into account interest rate hedges in effect during the period. Floating rate debt is presented with the stated interest rate spread over 30-day LIBOR, unless otherwise specified.
(2) | The loan carries a fixed interest rate of 300 basis points for the first five years and is prepayable without penalty at the end of year five.
(3) | The loan is comprised of a $35.5 million mortgage loan and $0.9 million subordinate loan with a fixed interest rate of 350 basis points and 700 basis points, respectively, for the first five years and is prepayable without penalty at the end of year five.
(4) | Our investment in the property was deconsolidated as of January 1, 2018. See Note 6, "Investments in Unconsolidated Joint Ventures".
(5) | In May 2018, the loan was repaid in connection with the sale of property.
(6) | In June 2018, the Series J Preferred Units were redeemed in connection with the sale of the property.
(7) | In May 2018, we exercised a 12-month extension option.
(8) | In June 2018, we exercised a 12-month extension option.
At June 30, 2018 and December 31, 2017, the gross book value of the properties and debt and preferred equity investments collateralizing the mortgages and other loans payable, not including assets held for sale, was approximately $3.8 billion and $4.8 billion, respectively. Master Repurchase Agreements The Company has entered into two Master Repurchase Agreements, or MRAs, known as the 2016 MRA and 2017 MRA, which provide us with the ability to sell certain debt investments with a simultaneous agreement to repurchase the same at a certain date or on demand. We seek to mitigate risks associated with our repurchase agreement by managing the credit quality of our assets, early repayments, interest rate volatility, liquidity, and market value. The margin call provisions under our repurchase facilities permit valuation adjustments based on capital markets activity, and are not limited to collateral-specific credit marks. To monitor credit risk associated with our debt investments, our asset management team regularly reviews our investment portfolio and is in contact with our borrowers in order to monitor the collateral and enforce our rights as necessary. The risk associated with potential margin calls is further mitigated by our ability to recollateralize the facility with additional assets from our portfolio of debt investments, our ability to satisfy margin calls with cash or cash equivalents and our access to additional liquidity through the 2017 credit facility, as defined below. In June 2017, we entered into the 2017 MRA, with a maximum facility capacity of $300.0 million. In April 2018, we increased the maximum facility capacity to $400.0 million. The facility bears interest on a floating rate basis at a spread to 30-day LIBOR based on the pledged collateral and advance rate and has an initial one year term, with two one year extension options. In June 2018, we exercised a one year extension option. At June 30, 2018, the facility had an outstanding balance of $299.2 million, net of deferred financing costs. In July 2016, we entered into a restated 2016 MRA, with a maximum facility capacity of $300.0 million. In June 2018, we terminated the restated 2016 MRA. The facility bore interest ranging from 225 and 400 basis points over 30-day LIBOR depending on the pledged collateral and had an initial two-year term, with a one year extension option. Since December 6, 2015, we had been required to pay monthly in arrears a 25 basis point fee on the excess of $150.0 million over the average daily balance during the period when the average daily balance was less than $150.0 million. Corporate Indebtedness 2017 Credit Facility In November 2017, we entered into an amendment to the credit facility, referred to as the 2017 credit facility, that was originally entered into by the Company in November 2012, or the 2012 credit facility. As of June 30, 2018, the 2017 credit facility consisted of a $1.5 billion revolving credit facility, a $1.3 billion term loan (or "Term Loan A"), and a $200.0 million term loan (or "Term Loan B") with maturity dates of March 31, 2022, March 31, 2023, and November 21, 2024, respectively. The revolving credit facility has two six-month as-of-right extension options to March 31, 2023. We also have an option, subject to customary conditions, to increase the capacity of the credit facility to $4.5 billion at any time prior to the maturity dates for the revolving credit facility and term loans without the consent of existing lenders, by obtaining additional commitments from our existing lenders and other financial institutions. As of June 30, 2018, the 2017 credit facility bore interest at a spread over 30-day LIBOR ranging from (i) 82.5 basis points to 155 basis points for loans under the revolving credit facility, (ii) 90 basis points to 175 basis points for loans under Term Loan A, and (iii) 150 basis points to 245 basis points for loans under Term Loan B, in each case based on the credit rating assigned to the senior unsecured long term indebtedness of the Company. At June 30, 2018, the applicable spread was 100 basis points for the revolving credit facility, 110 basis points for Term Loan A, and 165 basis points for Term Loan B. We are required to pay quarterly in arrears a 12.5 to 30 basis point facility fee on the total commitments under the revolving credit facility based on the credit rating assigned to the senior unsecured long term indebtedness of the Company. As of June 30, 2018, the facility fee was 20 basis points. As of June 30, 2018, we had $11.8 million of outstanding letters of credit, $360.0 million drawn under the revolving credit facility and $1.5 billion outstanding under the term loan facilities, with total undrawn capacity of $1.1 billion under the 2017 credit facility. At June 30, 2018 and December 31, 2017, the revolving credit facility had a carrying value of $351.3 million and $30.3 million, respectively, net of deferred financing costs. At June 30, 2018 and December 31, 2017, the term loan facilities had a carrying value of $1.5 billion and $1.5 billion, respectively, net of deferred financing costs. The Company and the Operating Partnership are borrowers jointly and severally obligated under the 2017 credit facility. ROP is a guarantor under the 2017 credit facility. The 2017 credit facility includes certain restrictions and covenants (see Restrictive Covenants below). Senior Unsecured Notes The following table sets forth our senior unsecured notes and other related disclosures as of June 30, 2018 and December 31, 2017, respectively, by scheduled maturity date (amounts in thousands):
Issuance |  | June 30, 2018 Unpaid Principal Balance |  | June 30, 2018 Accreted Balance |  | December 31, 2017 Accreted Balance |  | Coupon Rate (1) |  | Initial Term (in Years) |  | Maturity Date
August 5, 2011 (2) |  | $ | 250,000 |  |  | $ | 249,991 |  |  | $ | 249,953 |  |  | 5.00 | % |  | 7 |  | August 2018
March 16, 2010 (2) |  | 250,000 |  |  | 250,000 |  |  | 250,000 |  |  | 7.75 | % |  | 10 |  | March 2020
October 5, 2017 (3) |  | 500,000 |  |  | 499,539 |  |  | 499,489 |  |  | 3.25 | % |  | 5 |  | October 2022
November 15, 2012 (4) |  | 300,000 |  |  | 304,673 |  |  | 305,163 |  |  | 4.50 | % |  | 10 |  | December 2022
December 17, 2015 (2) |  | 100,000 |  |  | 100,000 |  |  | 100,000 |  |  | 4.27 | % |  | 10 |  | December 2025
|  | $ | 1,400,000 |  |  | $ | 1,404,203 |  |  | $ | 1,404,605 |  |  |  |  |  |  |
Deferred financing costs, net |  |  |  | (7,481 | ) |  | (8,666 | ) |  |  |  |  |  |
|  | $ | 1,400,000 |  |  | $ | 1,396,722 |  |  | $ | 1,395,939 |  |  |  |  |  |  |
(1) | Interest on the senior unsecured notes is payable semi-annually with principal and unpaid interest due on the scheduled maturity dates.
(2) | Issued by the Company, the Operating Partnership and ROP, as co-obligors.
(3) | Issued by the Operating Partnership with the Company and ROP as guarantors.
(4) | In October 2017, the Company, the Operating Partnership and ROP, as co-obligors, issued an additional $100.0 million of 4.50% senior unsecured notes due December 2022. The notes were priced at 105.334%.
In August 2018, the Operating Partnership issued $350.0 million of senior unsecured notes, with the Company and ROP as guarantors. The notes bear interest at a floating rate, reset quarterly, equal to three-month LIBOR plus 98 basis points. The notes will mature in August 2021 and can be redeemed at par beginning in August 2019. Restrictive Covenants The terms of the 2017 credit facility and certain of our senior unsecured notes include certain restrictions and covenants which may limit, among other things, our ability to pay dividends, make certain types of investments, incur additional indebtedness, incur liens and enter into negative pledge agreements and dispose of assets, and which require compliance with financial ratios relating to the maximum ratio of total indebtedness to total asset value, a minimum ratio of EBITDA to fixed charges, a maximum ratio of secured indebtedness to total asset value and a maximum ratio of unsecured indebtedness to unencumbered asset value. The dividend restriction referred to above provides that, we will not during any time when a default is continuing, make distributions with respect to common stock or other equity interests, except to enable the Company to continue to qualify as a REIT for Federal income tax purposes. As of June 30, 2018 and December 31, 2017, we were in compliance with all such covenants. Junior Subordinated Deferrable Interest Debentures In June 2005, the Company and the Operating Partnership issued $100.0 million in unsecured trust preferred securities through a newly formed trust, SL Green Capital Trust I, or the Trust, which is a wholly-owned subsidiary of the Operating Partnership. The securities mature in 2035 and bear interest at a floating rate of 125 basis points over the three-month LIBOR. Interest payments may be deferred for a period of up to eight consecutive quarters if the Operating Partnership exercises its right to defer such payments. The Trust preferred securities are redeemable at the option of the Operating Partnership, in whole or in part, with no prepayment premium. We do not consolidate the Trust even though it is a variable interest entity as we are not the primary beneficiary. Because the Trust is not consolidated, we have recorded the debt on our consolidated balance sheets and the related payments are classified as interest expense. Principal Maturities Combined aggregate principal maturities of mortgages and other loans payable, 2017 credit facility, trust preferred securities, senior unsecured notes and our share of joint venture debt as of June 30, 2018, including as-of-right extension options and put options, were as follows (in thousands):
| Scheduled Amortization |  | Principal |  | Revolving Credit Facility |  | Unsecured Term Loans |  | Trust Preferred Securities |  | Senior Unsecured Notes |  | Total |  | Joint Venture Debt
Remaining 2018 | $ | 19,097 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 250,000 |  |  | $ | 269,097 |  |  | $ | 4,986 |
2019 | 42,271 |  |  | 102,000 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 144,271 |  |  | 252,795 |
2020 | 23,466 |  |  | 979,531 |  |  | — |  |  | — |  |  | — |  |  | 250,000 |  |  | 1,252,997 |  |  | 276,006 |
2021 | 11,638 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 11,638 |  |  | 454,621 |
2022 | 9,430 |  |  | 198,555 |  |  | — |  |  | — |  |  | — |  |  | 800,000 |  |  | 1,007,985 |  |  | 220,810 |
Thereafter | 16,591 |  |  | 1,136,117 |  |  | 360,000 |  |  | 1,500,000 |  |  | 100,000 |  |  | 100,000 |  |  | 3,212,708 |  |  | 2,879,344 |
| $ | 122,493 |  |  | $ | 2,416,203 |  |  | $ | 360,000 |  |  | $ | 1,500,000 |  |  | $ | 100,000 |  |  | $ | 1,400,000 |  |  | $ | 5,898,696 |  |  | $ | 4,088,562 |
Consolidated interest expense, excluding capitalized interest, was comprised of the following (in thousands):
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2018 |  | 2017 |  | 2018 |  | 2017
Interest expense before capitalized interest | $ | 61,553 |  |  | $ | 71,992 |  |  | $ | 116,471 |  |  | $ | 144,414 |
Interest capitalized | (7,594 | ) |  | (6,743 | ) |  | (14,280 | ) |  | (13,022 | )
Interest income | (348 | ) |  | (393 | ) |  | (664 | ) |  | (914 | )
Interest expense, net | $ | 53,611 |  |  | $ | 64,856 |  |  | $ | 101,527 |  |  | $ | 130,478 |

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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