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Derivative Financial Instruments | 6 Months Ended
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Jun. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Financial Instruments | Derivative Financial Instruments During the second quarter of 2018, we entered into $150.0 million notional amount of forward-starting swaps that effectively lock the underlying 10-year treasury rate at 2.91% with respect to a planned issuance of debt securities by the Operating Partnership expected to occur prior to June 11, 2019. During 2017, we entered into $150.0 million notional amount of forward-starting swaps that effectively locked the underlying 10-year treasury rate at 2.44% with respect to a planned issuance of debt securities by the Operating Partnership. Upon issuance of the $350.0 million aggregate principal amount of 4.125% notes due 2028 during the first quarter of 2018, we terminated the forward-starting swaps resulting in an unrealized gain of $7.0 million in accumulated other comprehensive income and a gain of $0.2 million of hedge ineffectiveness in interest expense. The counterparties under our swaps are major financial institutions. The swap agreements contain a provision whereby if we default on certain of our indebtedness and which default results in repayment of such indebtedness being, or becoming capable of being, accelerated by the lender, then we could also be declared in default on our swaps. Our interest rate swaps have been designated as and are being accounted for as cash flow hedges with the effective portion of changes in fair value recorded in other comprehensive income each reporting period. No significant gain or loss was recognized related to hedge ineffectiveness or to amounts excluded from effectiveness testing on our cash flow hedges during the six months ended June 30, 2018 and 2017. We have no collateral requirements related to our interest rate swaps. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our debt. During the period from July 1, 2018 through June 30, 2019, we estimate that $2.5 million will be reclassified as a decrease to interest expense. The following table sets forth the fair value of our derivatives:
| June 30, 2018 |  | December 31, 2017
Derivatives: |  |  |
Derivatives designated as cash flow hedges in prepaid expenses and other assets: |  |  |
Interest rate swaps | $ | 2,871 |  |  | $ | 1,286 |
The following table sets forth the effect of our cash flow hedges on accumulated other comprehensive income and interest expense:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2018 |  | 2017 |  | 2018 |  | 2017
Derivatives Designated as Cash Flow Hedges: |  |  |  |  |  |  |
Amount of unrealized gains/(losses) recognized in accumulated other comprehensive income on derivatives (effective portion): |  |  |  |  |  |  |
Interest rate swaps | $ | 862 |  |  | $ | (136 | ) |  | $ | 8,739 |  |  | $ | 316 |
Amount of (gains)/losses reclassified out of accumulated other comprehensive income into contractual interest expense (effective portion): |  |  |  |  |  |  |
Interest rate swaps | $ | (515 | ) |  | $ | 297 |  |  | $ | (621 | ) |  | $ | 781 |

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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