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Notes Payable (Tables) | 9 Months Ended
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Sep. 30, 2016
Debt Disclosure [Abstract] |
Schedule of Long-term Debt Instruments | The following table summarizes the balances of the Company’s indebtedness as of:
| September 30, 2016 |  | December 31, 2015
Notes payable | $ | 2,427,440 |  |  | $ | 2,278,445 |
Less: unamortized loan premium and deferred financing costs, net(1) | (19,497 | ) |  | (17,729 | )
Notes payable, net | $ | 2,407,943 |  |  | $ | 2,260,716 |
________________
(1) | Deferred financing costs exclude debt issuance costs, net, related to establishing the Company’s unsecured revolving credit facility and undrawn term loans. The amounts included in prepaid expenses and other assets, net was $1.7 million and $4.1 million as of September 30, 2016 and December 31, 2015, respectively.
The following table sets forth information as of September 30, 2016 and December 31, 2015 with respect to the Company’s outstanding indebtedness, excluding net deferred financing costs related to unsecured revolving credit facility and undrawn term loans.
| September 30, 2016 |  | December 31, 2015 |  |  |  |  |
| Principal Amount |  | Deferred Financing Costs, net |  | Principal Amount |  | Unamortized Loan Premium and Deferred Financing Costs, net |  | Interest Rate(1) |  | Contractual Maturity Date |
Unsecured Loans |  |  |  |  |  |  |  |  |  |  |  |
Unsecured Revolving Credit Facility(2) | $ | 120,000 |  |  | $ | — |  |  | $ | 230,000 |  |  | $ | — |  |  | LIBOR+ 1.15% to 1.85% |  | 4/1/2019 | (3)
5-Year Term Loan due April 2020(2)(4) | 450,000 |  |  | (3,783 | ) |  | 550,000 |  |  | (5,571 | ) |  | LIBOR+ 1.30% to 2.20% |  | 4/1/2020 |
5-Year Term Loan due November 2020(2) | 175,000 |  |  | (793 | ) |  | — |  |  | — |  |  | LIBOR +1.30% to 2.20% |  | 11/17/2020 |
7-Year Term Loan due April 2022(2)(5) | 350,000 |  |  | (2,372 | ) |  | 350,000 |  |  | (2,656 | ) |  | LIBOR+ 1.60% to 2.55% |  | 4/1/2022 |
7-Year Term Loan due November 2022(2)(6) | 125,000 |  |  | (970 | ) |  | — |  |  | — |  |  | LIBOR + 1.60% to 2.55% |  | 11/17/2022 |
Series A Notes | 110,000 |  |  | (970 | ) |  | 110,000 |  |  | (1,011 | ) |  | 4.34% |  | 1/2/2023 |
Series E Notes | 50,000 |  |  | (311 | ) |  | — |  |  | — |  |  | 3.66% |  | 9/15/2023 |
Series B Notes | 259,000 |  |  | (2,335 | ) |  | 259,000 |  |  | (2,378 | ) |  | 4.69% |  | 12/16/2025 |
Series D Notes | 150,000 |  |  | (922 | ) |  | — |  |  | — |  |  | 3.98% |  | 7/6/2026 |
Series C Notes | 56,000 |  |  | (552 | ) |  | 56,000 |  |  | (509 | ) |  | 4.79% |  | 12/16/2027 |
Total Unsecured Loans | 1,845,000 |  |  | (13,008 | ) |  | 1,555,000 |  |  | (12,125 | ) |  |  |  |  |
Mortgage Loans |  |  |  |  |  |  |  |  |  |  |  |
Mortgage Loan secured by Rincon Center(7) | 100,886 |  |  | (236 | ) |  | 102,309 |  |  | (355 | ) |  | 5.13% |  | 5/1/2018 |
Mortgage Loan secured by Sunset Gower/Sunset Bronson(8) | 5,001 |  |  | (1,712 | ) |  | 115,001 |  |  | (2,232 | ) |  | LIBOR+2.25% |  | 3/4/2019 | (3)
Mortgage Loan secured by Met Park North(9) | 64,500 |  |  | (426 | ) |  | 64,500 |  |  | (509 | ) |  | LIBOR+1.55% |  | 8/1/2020 |
Mortgage Loan secured by 10950 Washington(7) | 28,053 |  |  | (371 | ) |  | 28,407 |  |  | (421 | ) |  | 5.32% |  | 3/11/2022 |
Mortgage Loan secured by Pinnacle I(10)(11) | 129,000 |  |  | (618 | ) |  | 129,000 |  |  | (694 | ) |  | 3.95% |  | 11/7/2022 |
Mortgage Loan secured by Element L.A. | 168,000 |  |  | (2,387 | ) |  | 168,000 |  |  | (2,584 | ) |  | 4.59% |  | 11/6/2025 |
Mortgage Loan secured by Pinnacle II(11) | 87,000 |  |  | (739 | ) |  | 86,228 |  |  | 1,310 |  | (12) | 4.30% |  | 6/11/2026 |
Mortgage Loan secured by 901 Market | — |  |  | — |  |  | 30,000 |  |  | (119 | ) |  | N/A |  | N/A |
Total Mortgage Loans(13) | 582,440 |  |  | (6,489 | ) |  | 723,445 |  |  | (5,604 | ) |  |  |  |  |
Total | $ | 2,427,440 |  |  | $ | (19,497 | ) |  | $ | 2,278,445 |  |  | $ | (17,729 | ) |  |  |  |  |
_________________
(1) | Interest rate with respect to indebtedness is calculated on the basis of a 360-day year for the actual days elapsed. Interest rates are as of September 30, 2016, which may be different than the interest rates as of December 31, 2015 for corresponding indebtedness.
(2) | The Company has the option to make an irrevocable election to change the interest rate depending on the Company’s credit rating. As of September 30, 2016, no such election had been made.
(3) | The maturity date may be extended once for an additional one-year term.
(4) | Effective May 1, 2015, $300.0 million of the term loan has been effectively fixed at 2.66% to 3.56% per annum through the use of an interest rate swap. In July 2016, the Company amended this interest rate swap to add a 0.00% floor to one-month LIBOR, and then de-designated the original swap and designated the amended swap as a hedge in order to minimize the ineffective portion of the original derivative related to this loan. Therefore, the effective interest rate with respect to $300.0 million of the term loan increased to a range of 2.75% to 3.65% per annum. See Note 11—Derivative Instruments for details.
(5) | Effective May 1, 2015, the outstanding balance of the term loan has been effectively fixed at 3.21% to 4.16% per annum through the use of an interest rate swap. In July 2016, the Company amended this interest rate swap to add a 0.00% floor to one-month LIBOR, and then de-designated the original swap and designated the amended swap as a hedge in order to minimize the ineffective portion of the original derivative related to this loan. Therefore, the effective interest rate increased to a range of 3.36% to 4.31% per annum. See Note 11—Derivative Instruments for details.
(6) | Effective June 1, 2016, the outstanding balance of the term loan has been effectively fixed at 3.03% to 3.98% per annum through the use of an interest rate swap. See Note 11—Derivative Instruments for details.
(7) | Monthly debt service includes annual debt amortization payments based on a 30-year amortization schedule with a balloon payment at maturity.
(8) | Through February 11, 2016, interest on $92.0 million of the outstanding loan balance was effectively capped at 5.97% and 4.25% on $50.0 million and $42.0 million, respectively, of the loan through the use of two interest rate caps. These interest rate caps were not renewed after maturity.
(9) | This loan bears interest only. Interest on the full loan amount has been effectively fixed at 3.71% per annum through use of an interest rate swap. See Note 11—Derivative Instruments for details.
(10) | This loan bears interest only for the first five years. Beginning with the payment due December 6, 2017, monthly debt service will include annual debt amortization payments based on a 30-year amortization schedule with a balloon payment at maturity.
(11) | The Company owns approximately 65% of the ownership interests in the joint venture that owns the Pinnacle I and II properties.
(12) | Represents unamortized premium amount of the non-cash mark-to-market adjustment.
(13) | Total mortgage loans do not include the balance related to a loan entered on October 7, 2016 for $101.0 million with a fixed interest rate of 3.38% per annum. This loan was entered into in conjunction with the acquisition of the Hill7 office property through a joint venture with Canadian Pension Plan Investment Board. The Company owns 55% of the ownership interest in the joint venture. See Note 20—Subsequent Events for details.
Schedule of Maturities of Long-term Debt | The minimum future principal payments due on the Company’s secured and unsecured notes payable at September 30, 2016 were as follows (before the impact of extension options, if applicable):
|  | Annual Principal Payments
Remaining 2016 |  | $ | 601 |
2017 |  | 2,714 |
2018 |  | 101,157 |
2019 |  | 127,886 |
2020 |  | 692,493 |
Thereafter |  | 1,502,589 |
Total |  | $ | 2,427,440 |

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