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Senior Secured Term Loan, Net

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Senior Secured Term Loan, Net

Secured Debt Arrangements, Net

At December 31, 2019 and 2018, our borrowings had the following secured debt arrangements, maturities and weighted- average interest rates ($ in thousands):

		December 31, 2019 (2)										December 31, 2018
		Maximum Amount of Borrowings				Borrowings Outstanding				Maturity (1)		Maximum Amount of Borrowings				Borrowings Outstanding				Maturity (1)
	JPMorgan Facility (USD)	$	1,154,109			$	1,090,160			June 2024		$	1,333,503			$	680,141			June 2021
	JPMorgan Facility (GBP)	51,702				50,410				June 2024		48,497				48,497				June 2021
	JPMorgan Facility (EUR)	94,189				94,189				June 2024		N/A				N/A				N/A
	DB Repurchase Facility (USD)	1,250,000				513,876				March 2021		904,181				419,823				March 2021
	DB Repurchase Facility (GBP)	N/A				N/A				N/A		150,819				150,819				March 2021
	Goldman Facility (USD)	500,000				322,170				November 2021		300,000				210,072				November 2020
	CS Facility - USD	226,068				218,644				June 2020		187,117				187,117				June 2019
	CS Facility - GBP	93,915				93,915				June 2020		151,773				151,773				June 2019
	HSBC Facility - USD	50,625				50,625				October 2020		N/A				N/A				N/A
	HSBC Facility - GBP	34,634				34,634				June 2020		48,835				48,835				December 2019
	HSBC Facility - EUR	154,037				154,037				January 2021		N/A				N/A				N/A
	Barclays Facility (GBP)	538,916				290,347				February 2024		N/A				N/A				N/A
	Barclays Facility (EUR)	182,549				182,549				November 2020		N/A				N/A				N/A
	Sub-total	4,330,744				3,095,556						3,124,725				1,897,077
	less: deferred financing costs	N/A				(17,190		)				N/A				(17,555		)
	Total / Weighted-Average	$	4,330,744			$	3,078,366					$	3,124,725			$	1,879,522

———————

(1) Maturity date assumes extensions at our option are exercised.

(2) Weighted-average rate as of December 31, 2019 was USD L + 2.07% / GBP L + 1.75% / EUR L + 1.36%.

JPMorgan Facility

In November 2019, through three indirect wholly-owned subsidiaries, we entered into a Sixth Amended and Restated Master Repurchase Agreement with JPMorgan Chase Bank, National Association. The JPMorgan Facility allows for $1.3 billion of maximum borrowings (with amounts borrowed in British pounds and Euros converted to U.S. dollars for purposes of calculating availability based on the greater of the spot rate as of the initial financing under the corresponding mortgage loan and the then-current spot rate) and matures in June 2022, plus two one-year extensions available, which are subject to the approval of JPMorgan and certain other conditions. The JPMorgan Facility enables us to elect to receive advances in U.S. Dollars, British pounds, or Euros. Margin calls may occur any time at specified aggregate margin deficit thresholds. We have agreed to provide a limited guarantee of the obligations of our indirect wholly-owned subsidiaries under the JPMorgan Facility.

As of December 31, 2019, we had $1.2 billion (including £38.0 million and €84.0 million assuming conversion into U.S. dollars) of borrowings outstanding under the JPMorgan Facility secured by certain of our commercial mortgage loans.

DB Repurchase Facility

In April 2018, through an indirect wholly-owned subsidiary, we entered into a Second Amended and Restated Master Repurchase Agreement with Deutsche Bank AG, Cayman Islands Branch and Deutsche Bank AG, London Branch, which was upsized in September 2019, and provides for advances of up to $1.25 billion, and enables us to elect to receive advances in U.S. dollars, British pounds, or Euros. The repurchase facility matures in March 2020, plus a one-year extension available at our option, subject to certain conditions. Margin calls may occur any time at specified aggregate margin deficit thresholds. We have agreed to provide a guarantee of the obligations of our indirect wholly-owned subsidiaries under this facility.

As of December 31, 2019, we had $513.9 million of borrowings outstanding under the DB Repurchase Facility secured by certain of our commercial mortgage loans.

Goldman Facility

In November 2017, through an indirect wholly-owned subsidiary, we entered into a master repurchase and securities contract agreement with Goldman Sachs Bank USA, which was upsized in March 2019 from $300.0 million to $500.0 million

and matures in November 2020, plus a one-year extension available at our option, subject to certain conditions. Margin calls may occur any time at specified margin deficit thresholds. We have agreed to provide a limited guarantee of the obligations of our indirect wholly-owned subsidiaries under this facility.

As of December 31, 2019, we had $322.2 million of borrowings outstanding under the Goldman Facility secured by certain of our commercial mortgage loans.

CS Facility - USD

In July 2018, through an indirect wholly-owned subsidiary, we entered into a Master Repurchase Agreement with Credit Suisse AG, acting through its Cayman Islands Branch and Alpine Securitization Ltd, which provides for advances for the sale and repurchase of eligible commercial mortgage loans secured by real estate. The CS Facility - USD matures in June 2020 (or, if earlier, six months after Credit Suisse AG notifies us of their intention to terminate). Margin calls may occur any time at specified aggregate margin deficit thresholds. We have agreed to provide a guarantee of the obligations of our indirect wholly-owned subsidiary under this facility.

As of December 31, 2019, we had $218.6 million of borrowings outstanding under the CS Facility - USD secured by certain of our commercial mortgage loans.

CS Facility - GBP

In June 2018, through an indirect wholly-owned subsidiary, we entered into a Master Repurchase Agreement with Credit Suisse AG, acting through its Cayman Islands Branch and Alpine Securitization Ltd, which provides for advances for the sale and repurchase of eligible commercial mortgage loans secured by real estate. The CS Facility - GBP matures six months after either party notifies the other party of intention to terminate. Margin calls may occur any time at specified aggregate margin deficit thresholds. We have agreed to provide a guarantee of the obligations of our indirect wholly-owned subsidiary under this facility.

As of December 31, 2019, we had $93.9 million (£70.8 million assuming conversion into U.S. dollars) of borrowings outstanding under the CS Facility - GBP secured by one of our commercial mortgage loans.

HSBC Facility - USD

In October 2019, through an indirect wholly-owned subsidiary, we entered into a secured debt arrangement with HSBC Bank plc, which provides for a single asset financing. The facility is initially scheduled to mature in October 2020 and unless terminated by either party, automatically extends for further periods prior to maturity. Margin calls may occur any time at specified aggregate margin thresholds. We have agreed to provide a guarantee of the obligations of our indirect wholly-owned subsidiary under this facility.

As of December 31, 2019, we had $50.6 million of borrowings under the HSBC Facility - USD secured by one of our commercial mortgage loans.

HSBC Facility - GBP

In September 2018, through an indirect wholly-owned subsidiary, we entered into a secured debt arrangement with HSBC Bank plc, which provides for a single asset financing. The facility, which was extended in December 2019, is scheduled to mature in June 2020 and, unless terminated by either party, automatically extends for further periods prior to maturity. Margin calls may occur any time at specified aggregate margin deficit thresholds. We have agreed to provide a guarantee of the obligations of our indirect wholly-owned subsidiary under this facility.

As of December 31, 2019, we had $34.6 million (£26.1 million assuming conversion into U.S. dollars) of borrowings outstanding under the HSBC Facility - GBP secured by one of our commercial mortgage loans.

HSBC Facility - EUR

In July 2019, through an indirect wholly-owned subsidiary, we entered into a secured debt arrangement with HSBC Bank plc, which provides for a single asset financing. The facility matures in January 2021. Margin calls may occur any time at specified aggregate margin deficit thresholds. We have agreed to provide a guarantee of the obligations of our indirect wholly-owned subsidiary under this facility.

As of December 31, 2019, we had $154.0 million (€137.4 million assuming conversion into U.S. dollars) of borrowings outstanding under the HSBC Facility - EUR secured by one of our commercial mortgage loans.

Barclays Facility

Beginning in October 2019, through an indirect wholly-owned subsidiary, we entered into three secured debt arrangements pursuant to a Global Master Repurchase Agreement with Barclays Bank plc, which provide for single asset financing. The financings mature in November 2020, March 2022, and October 2022 with extension options to match the duration of the corresponding mortgage loans, subject to certain conditions. We have agreed to provide a limited guarantee of the obligations of our indirect wholly-owned subsidiary under this facility.

As of December 31, 2019, we had $472.9 million (£219.0 million and €162.8 million assuming conversion into U.S. dollars) of borrowings outstanding under the Barclays Facility secured by three of our commercial mortgage loans.

At December 31, 2019, our borrowings had the following remaining maturities ($ in thousands): 

	Less than 1 year (1)				1 to 3 years (1)				3 to 5 years				More than 5 years				Total
JPMorgan Facility	$	143,841			$	251,002			$	839,916			$	—			$	1,234,759
DB Repurchase Facility	32,400				481,476				—				—				513,876
Goldman Facility	—				322,170				—				—				322,170
CS Facility - USD	218,644				—				—				—				218,644
CS Facility - GBP	93,915				—				—				—				93,915
HSBC Facility - USD	50,625				—				—				—				50,625
HSBC Facility - GBP	34,634				—				—				—				34,634
HSBC Facility - EUR	—				154,037				—				—				154,037
Barclays Facility (GBP)	—				—				290,347				—				290,347
Barclays Facility (EUR)	182,549				—				—				—				182,549
Total	$	756,608			$	1,208,685			$	1,130,263			$	—			$	3,095,556

———————

(1) Assumes underlying assets are financed through the fully extended maturity date of the facility.

The table below summarizes the outstanding balances at December 31, 2019, as well as the maximum and average month-end balances for the year ended December 31, 2019 for our borrowings under secured debt arrangements ($ in thousands).

									For the year ended December 31, 2019
	Balance at December 31, 2019				Amortized Cost of collateral at December 31, 2019				Maximum Month-End Balance				Average Month-End Balance
JPMorgan Facility	$	1,234,759			$	1,845,400			$	1,234,759			$	947,400
DB Repurchase Facility	513,876				766,676				757,117				604,067
Goldman Facility	322,170				513,559				324,821				246,318
CS Facility - USD	218,644				308,884				218,644				182,646
CS Facility - GBP	93,915				129,723				150,811				134,694
HSBC Facility - USD	50,625				66,960				50,625				50,625
HSBC Facility - GBP	34,634				49,976				50,784				42,296
HSBC Facility - EUR	154,037				190,780				154,037				151,889
Barclays Facility (GBP)	290,347				738,455				290,347				139,004
Barclays Facility (EUR)	182,549				241,674				182,549				181,159
Total	$	3,095,556			$	4,852,087

We were in compliance with the covenants under each of our secured debt arrangements at December 31, 2019 and 2018.

Senior Secured Term Loan, Net

In May 2019, we entered into a $500.0 million senior secured term loan. The senior secured term loan bears interest at LIBOR plus 2.75% and was issued at a price of 99.5%. The senior secured term loan matures in May 2026 and contains restrictions relating to liens, asset sales, indebtedness, and investments in non-wholly owned entities.

For the year ended December 31, 2019, we repaid $2.5 million of principal related to the senior secured term loan. The outstanding principal balance as of December 31, 2019 was $497.5 million. As of December 31, 2019, the senior secured term loan had a carrying value of $488.0 million net of deferred financing costs of $7.3 million and an unamortized discount of $2.2 million.

Covenants

The senior secured term loan includes the following financial covenants: (i) our ratio of total recourse debt to tangible net worth cannot be greater than 3:1; and (ii) our ratio of total unencumbered assets to total pari-passu indebtedness must be at least 1.25:1.

We were in compliance with the covenants under the senior secured term loan at December 31, 2019.

Interest Rate Swap

In connection with the senior secured term loan, we entered into an interest rate swap to fix LIBOR at 2.12% effectively fixing our all-in coupon on the senior secured term loan at 4.87%.

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- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

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