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Mortgage Notes Payable | 12 Months Ended
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Dec. 31, 2016
Debt Disclosure [Abstract] |
Mortgage Notes Payable | Mortgage Notes Payable: Mortgage notes payable at December 31, 2016 and 2015 consist of the following:
|  | Carrying Amount of Mortgage Notes(1) |  |  |  |  |  |
|  | 2016 |  | 2015 |  | Effective Interest Rate(2) |  | Monthly Debt Service(3) |  | Maturity Date(4)
Property Pledged as Collateral |  | Related Party |  | Other |  | Related Party |  | Other |
Arrowhead Towne Center(5) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 221,194 |  |  | — |  |  | $ | — |  |  | — |
Chandler Fashion Center(6) |  | — |  |  | 199,833 |  |  | — |  |  | 199,766 |  |  | 3.77 | % |  | 625 |  |  | 2019 |
Danbury Fair Mall |  | 107,929 |  |  | 107,928 |  |  | 111,078 |  |  | 111,079 |  |  | 5.53 | % |  | 1,538 |  |  | 2020 |
Deptford Mall(7) |  | — |  |  | — |  |  | — |  |  | 193,337 |  |  | — |  |  | — |  |  | — |
Deptford Mall(8) |  | — |  |  | — |  |  | — |  |  | 13,999 |  |  | — |  |  | — |  |  | — |
Fashion Outlets of Chicago(9) |  | — |  |  | 198,966 |  |  | — |  |  | 198,653 |  |  | 2.43 | % |  | 378 |  |  | 2020 |
Fashion Outlets of Niagara Falls USA |  | — |  |  | 115,762 |  |  | — |  |  | 117,708 |  |  | 4.89 | % |  | 727 |  |  | 2020 |
Flagstaff Mall(10) |  | — |  |  | — |  |  | — |  |  | 37,000 |  |  | — |  |  | — |  |  | — |
FlatIron Crossing(7) |  | — |  |  | — |  |  | — |  |  | 254,075 |  |  | — |  |  | — |  |  | — |
Freehold Raceway Mall(6) |  | — |  |  | 220,643 |  |  | — |  |  | 224,836 |  |  | 4.20 | % |  | 1,132 |  |  | 2018 |
Fresno Fashion Fair(11) |  | — |  |  | 323,062 |  |  | — |  |  | — |  |  | 3.67 | % |  | 971 |  |  | 2026 |
Green Acres Mall |  | — |  |  | 297,798 |  |  | — |  |  | 303,960 |  |  | 3.61 | % |  | 1,447 |  |  | 2021 |
Kings Plaza Shopping Center |  | — |  |  | 456,958 |  |  | — |  |  | 466,266 |  |  | 3.67 | % |  | 2,229 |  |  | 2019 |
Northgate Mall(12) |  | — |  |  | 63,434 |  |  | — |  |  | 63,783 |  |  | 3.50 | % |  | 206 |  |  | 2017 |
Oaks, The |  | — |  |  | 201,235 |  |  | — |  |  | 205,555 |  |  | 4.14 | % |  | 1,064 |  |  | 2022 |
Pacific View |  | — |  |  | 127,311 |  |  | — |  |  | 130,108 |  |  | 4.08 | % |  | 668 |  |  | 2022 |
Queens Center |  | — |  |  | 600,000 |  |  | — |  |  | 600,000 |  |  | 3.49 | % |  | 1,744 |  |  | 2025 |
Santa Monica Place |  | — |  |  | 219,564 |  |  | — |  |  | 224,815 |  |  | 2.99 | % |  | 1,004 |  |  | 2018 |
SanTan Village Regional Center |  | — |  |  | 127,724 |  |  | — |  |  | 130,638 |  |  | 3.14 | % |  | 589 |  |  | 2019 |
Stonewood Center |  | — |  |  | 99,520 |  |  | — |  |  | 105,494 |  |  | 1.80 | % |  | 640 |  |  | 2017 |
Superstition Springs Center(13) |  | — |  |  | — |  |  | — |  |  | 67,749 |  |  | — |  |  | — |  |  | — |
Towne Mall |  | — |  |  | 21,570 |  |  | — |  |  | 21,956 |  |  | 4.48 | % |  | 117 |  |  | 2022 |
Tucson La Encantada |  | 68,513 |  |  | — |  |  | 69,991 |  |  | — |  |  | 4.23 | % |  | 368 |  |  | 2022 |
Victor Valley, Mall of |  | — |  |  | 114,559 |  |  | — |  |  | 114,500 |  |  | 4.00 | % |  | 380 |  |  | 2024 |
Vintage Faire Mall |  | — |  |  | 269,228 |  |  | — |  |  | 274,417 |  |  | 3.55 | % |  | 1,256 |  |  | 2026 |
Westside Pavilion |  | — |  |  | 143,881 |  |  | — |  |  | 146,630 |  |  | 4.49 | % |  | 783 |  |  | 2022 |
|  | $ | 176,442 |  |  | $ | 3,908,976 |  |  | $ | 181,069 |  |  | $ | 4,427,518 |  |  |  |  |  |  |  |  |  |
(1) | The mortgage notes payable balances include the unamortized debt premiums (discounts). Debt premiums (discounts) represent the excess (deficiency) of the fair value of debt over (under) the principal value of debt assumed in various acquisitions and are amortized into interest expense over the remaining term of the related debt in a manner that approximates the effective interest method.
The debt premiums (discounts) as of December 31, 2016 and 2015 consist of the following:
Property Pledged as Collateral |  | 2016 |  | 2015
Arrowhead Towne Center |  | $ | — |  |  | $ | 8,494 |
Deptford Mall |  | — |  |  | (3 | )
Fashion Outlets of Niagara Falls USA |  | 3,558 |  |  | 4,486 |
Stonewood Center |  | 2,349 |  |  | 5,168 |
Superstition Springs Center |  | — |  |  | 263 |
|  | $ | 5,907 |  |  | $ | 18,408 |
The mortgage notes payable balances also include unamortized deferred finance costs that are amortized into interest expense over the remaining term of the related debt in a manner that approximates the effective interest method. Unamortized deferred finance costs were $12,716 and $16,025 at December 31, 2016 and 2015, respectively.
(2) | The interest rate disclosed represents the effective interest rate, including the debt premiums (discounts) and deferred finance costs.
(3) | The monthly debt service represents the payment of principal and interest.
(4) | The maturity date assumes that all extension options are fully exercised and that the Company does not opt to refinance the debt prior to these dates. These extension options are at the Company's discretion, subject to certain conditions, which the Company believes will be met.
(5) | On January 6, 2016, the Company replaced the existing loan on the property with a new $400,000 loan that bears interest at an effective rate of 4.05% and matures on February 1, 2028, which resulted in a loss of $3,575 on early extinguishment of debt. Concurrently, a 40% interest in the loan was assumed by a third party in connection with the sale of a 40% ownership interest in the underlying property (See Note 4—Investments in Unconsolidated Joint Ventures).
(6) | A 49.9% interest in the loan has been assumed by a third party in connection with a co-venture arrangement (See Note 10—Co-Venture Arrangement).
(7) | On January 14, 2016, a 49% interest in the loan was assumed by a third party in connection with the sale of a 49% ownership interest in the MAC Heitman Portfolio (See Note 4—Investments in Unconsolidated Joint Ventures).
(8) | On March 1, 2016, the Company paid off in full the loan on the property.
(9) | The loan bears interest at LIBOR plus 1.50% and matures on March 31, 2020. At December 31, 2016 and 2015, the total interest rate was 2.43% and 1.84%, respectively.
(10) | On July 15, 2016, the Company conveyed the property to the mortgage lender by a deed-in-lieu of foreclosure, which resulted in a gain of $5,284 on the extinguishment of debt (See Note 14—Dispositions).
(11) | On October 6, 2016, the Company placed a new $325,000 loan on the property that bears interest at an effective rate of 3.67% and matures on November 1, 2026.
(12) | The loan bore interest at LIBOR plus 2.25% and was to mature on March 1, 2017. At December 31, 2016 and 2015, the total interest rate was 3.50% and 3.30%, respectively. On January 18, 2017, the Company paid off the loan in full in connection with the sale of the underlying property (See Note 22—Subsequent Events).
(13) | On October 14, 2016, the Company paid off in full the loan on the property.
Most of the mortgage loan agreements contain a prepayment penalty provision for the early extinguishment of the debt. As of December 31, 2016, all of the Company's mortgage notes payable are secured by the properties on which they are placed and are non-recourse to the Company. The Company expects all loan maturities during the next twelve months, will be refinanced, restructured, extended and/or paid-off from the Company's line of credit or with cash on hand. Total interest expense capitalized during the years ended December 31, 2016, 2015 and 2014 was $10,316, $13,052 and $12,559, respectively. Related party mortgage notes payable are amounts due to affiliates of NML. See Note 17—Related Party Transactions for interest expense associated with loans from NML. The estimated fair value (Level 2 measurement) of mortgage notes payable at December 31, 2016 and 2015 was $4,126,819 and $4,628,781, respectively, based on current interest rates for comparable loans. Fair value was determined using a present value model and an interest rate that included a credit value adjustment based on the estimated value of the property that serves as collateral for the underlying debt. The future maturities of mortgage notes payable are as follows:
Year Ending December 31, |
2017 | $ | 218,562 |
2018 | 480,176 |
2019 | 796,592 |
2020 | 528,456 |
2021 | 291,733 |
Thereafter | 1,776,708 |
| 4,092,227 |
Debt premium, net | 5,907 |
Deferred finance cost, net | (12,716 | )
| $ | 4,085,418 |
The future maturities reflected above reflect the extension options that the Company believes will be exercised.

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