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Debt Obligations
 9 Months Ended
Sep. 30, 2025
Debt Obligations  
Debt Obligations

9.

Debt Obligations

Unsecured Credit Facility. Through the first quarter of 2024, we had an unsecured credit agreement (the “Original Credit Agreement”) that provided for an aggregate commitment of the lenders of up to $500,000,000 comprising of a $400,000,000 revolving credit facility (the “Revolving Line of Credit”) and two $50,000,000 term loans (the “Term Loans”). The Term Loans had maturities of November 19, 2025 and November 19, 2026. The Revolving Line of Credit had a maturity date of November 19, 2025 and provided a one-year extension option at our discretion, subject to customary conditions.

During the first quarter of 2024, we entered into an amendment to the Original Credit Agreement (the “Credit Agreement”) to accelerate our one-year extension option notice and exercised our option to extend the maturity date to November 19, 2026. Other material terms of the Original Credit Agreement remained unchanged. The Credit Agreement permitted us to request increases to the Revolving Line of Credit and Term Loans commitments up to a total of $1,000,000,000 (the “Accordion”). As permitted under the terms of the Credit Agreement, we exercised $25,000,000 of the available $500,000,000 Accordion feature of the Revolving Line of Credit during the third quarter of 2024. Accordingly, the aggregate commitment of the lenders under the Credit Agreement increased to $525,000,000, with $475,000,000 remaining available under the Accordion. The exercise of the Accordion did not change any other term or condition of the Credit Agreement, including its maturity date or covenant requirements.

During the third quarter of 2025, we entered into a new four-year unsecured credit agreement (the “New Credit Agreement”) maturing in July 2029, to replace our previous Credit Agreement. The New Credit Agreement increased the aggregate commitment on our revolving line of credit from $425,000,000 to $600,000,000 and provides for the opportunity to increase the total commitment to an aggregate $1,200,000,000. The New Credit Agreement provides for a one-year extension option, subject to customary conditions. Material terms of the New Credit Agreement remain unchanged. In connection with the New Credit Agreement, the Term Loans were rolled into the new revolving line of credit, keeping the interest rate swap agreements intact at an average 2.3% rate, based on current margins. Based on our leverage at September 30, 2025, the facility provides for interest annually at SOFR plus 115 basis points and a facility fee of 20 basis points.

Interest Rate Swap Agreements. In connection with entering into the Term Loans described above, we entered into two receive variable/pay fixed interest rate swap agreements (the “Interest Rate Swaps”) with maturities of November 19, 2025 and November 19, 2026, respectively, that effectively locked in the forecasted interest payments on the Term Loans’ borrowings over their four and five year terms of the loans. The Interest Rate Swaps are considered cash flow hedges and are recorded on our Consolidated Balance Sheets at fair value in Prepaid expenses and other assets, with cumulative changes in the fair value of these instruments recognized in Accumulated other comprehensive income (loss) on our Consolidated Balance Sheets. As discussed above, during the three months ended September 30, 2025, the Term Loans were paid off using proceeds from our new revolving line of credit under our New Credit Agreement, keeping the Interest Rate Swaps intact through November 2025 at 2.3% and November 2026 at 2.4%, based on current margins. During the three and nine months ended September 30, 2025, we recorded a decrease of $729,000 and $2,356,000 to the fair value of Interest Rate Swaps, respectively. During the three and nine months ended September 30, 2024, we recorded a decrease of $2,326,000 and $2,471,000 to the fair value of Interest Rate Swaps, respectively.

Information regarding our Interest Rate Swaps measured at fair value, which are classified as Level 2 of the fair value hierarchy is presented below (dollar amounts in thousands):

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Notional

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Fair Value at

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Date Entered

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Maturity Date

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Swap Rate

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Rate Index

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Amount

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September 30, 2025

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December 31, 2024

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November 2021

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November 19, 2025

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2.52

%

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1-month SOFR

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$

50,000

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$

200

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$

1,305

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November 2021

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November 19, 2026

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2.66

%

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1-month SOFR

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50,000

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1,259

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2,510

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$

100,000

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$

1,459

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$

3,815

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Senior Unsecured Notes. We have senior unsecured notes held by institutional investors with interest rates ranging from 3.66% to 4.50%. The senior unsecured notes mature between 2026 and 2033.

The senior unsecured notes and the Credit Agreement, contain financial covenants, which are measured quarterly, that require us to maintain, among other things:

●a ratio of total indebtedness to total asset value not greater than 0.6 to 1.0;

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●a ratio of secured debt to total asset value not greater than 0.35 to 1.0;

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●a ratio of unsecured debt to the value of the unencumbered asset value not greater than 0.6 to 1.0; and
●a ratio of EBITDA, as calculated in the debt obligation, to fixed charges not less than 1.50 to 1.0.

At September 30, 2025, we were in compliance with all applicable financial covenants. These debt obligations also contain additional customary covenants and events of default that are subject to a number of important and significant limitations, qualifications and exceptions.

The following table sets forth information regarding debt obligations by component as of September 30, 2025 and December 31, 2024 (dollar amounts in thousands):

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At September 30, 2025

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At December 31, 2024

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Applicable

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Available

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Available

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Interest

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Outstanding

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for

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Outstanding

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for

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Debt Obligations

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Rate (1)

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Balance

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Borrowing

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Balance

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Borrowing

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Revolving line of credit (2)

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4.76%

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$

548,450

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$

51,550

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$

144,350

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$

280,650

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Term loans, net of debt issue costs

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n/a

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—

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—

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99,808

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—

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Senior unsecured notes, net of debt issue costs

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4.12%

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396,065

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—

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440,442

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—

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Total

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4.49%

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$

944,515

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$

51,550

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$

684,600

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$

280,650

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(1)Represents weighted average interest rate as of September 30, 2025.

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(2)Subsequent to September 30, 2025, we repaid $62,900 under our unsecured revolving line of credit. Accordingly, we have $485,550 outstanding and $114,450 available for borrowing under our unsecured revolving line of credit.

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During the nine months ended September 30, 2025 and 2024, our debt borrowings and repayments were as follows (in thousands):

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Nine Months Ended September 30, 

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2025

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2024

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Debt Obligations

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Borrowings

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Repayments

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Borrowings

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Repayments

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Revolving line of credit

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$

433,500

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$

(29,400)

(1)

$

19,200

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$

(81,300)

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Term loans

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—

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(100,000)

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—

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—

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Senior unsecured notes

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—

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(44,500)

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—

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(44,160)

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Total

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$

433,500

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$

(173,900)

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$

19,200

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$

(125,460)

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(1)Subsequent to September 30, 2025, we repaid $62,900 under our unsecured revolving line of credit. Accordingly, we have $485,550 outstanding and $114,450 available for borrowing under our unsecured revolving line of credit.

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