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		Effective Interest Rate(2)		Monthly Debt Service(3)		Maturity Date(4)
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.