Debt Obligations, net

The Company's debt obligations were as follows ($ in thousands):



	Carrying Value as of						Stated Interest Rates			Scheduled Maturity Date
	March 31, 2017			December 31, 2016			Stated Interest Rates			Scheduled Maturity Date
Secured credit facilities and mortgages:
2015 $250 Million Secured Revolving Credit Facility	$	—		$	—		LIBOR + 2.75%		⁽¹⁾	March 2018
2016 Senior Secured Credit Facility	500,000			498,648			LIBOR + 3.75%		⁽²⁾	July 2020
2017 Secured Financing	227,000			—			3.795	%	⁽³⁾	April 2027
Mortgages collateralized by net lease assets	247,535			249,987			3.875% - 7.26%		⁽⁴⁾	Various through 2032
Total secured credit facilities and mortgages	974,535			748,635
Unsecured notes:
5.85% senior notes	—			99,722			5.85	%		—
9.00% senior notes	275,000			275,000			9.00	%		June 2017
4.00% senior notes⁽⁵⁾	550,000			550,000			4.00	%		November 2017
7.125% senior notes	300,000			300,000			7.125	%		February 2018
4.875% senior notes⁽⁶⁾	300,000			300,000			4.875	%		July 2018
5.00% senior notes⁽⁷⁾	770,000			770,000			5.00	%		July 2019
6.50% senior notes⁽⁸⁾	275,000			275,000			6.50	%		July 2021
6.00% senior notes⁽⁹⁾	375,000			—			6.00	%		April 2022
Total unsecured notes	2,845,000			2,569,722
Other debt obligations:
Trust preferred securities	100,000			100,000			LIBOR + 1.50%			October 2035
Total debt obligations	3,919,535			3,418,357
Debt discounts and deferred financing costs, net	(37,140		)	(28,449		)
Total debt obligations, net⁽¹⁰⁾	$	3,882,395		$	3,389,908

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(1)

The loan bears interest at the Company's election of either (i) a base rate, which is the greater of (a) prime, (b) federal funds plus 0.5% or (c) LIBOR plus 1.0% and subject to a margin ranging from 1.25% to 1.75%, or (ii) LIBOR subject to a margin ranging from 2.25% to 2.75%. At maturity, the Company may convert outstanding borrowings to a one year term loan which matures in quarterly installments through March 2019.


(2)	The loan bears interest at the Company's election of either (i) a base rate, which is the greater of (a) prime, (b) federal funds plus 0.5% or (c) LIBOR plus 1.0% and subject to a margin of 2.75% or (ii) LIBOR subject to a margin of 3.75% with a minimum LIBOR rate of 1.0%.


(3)	The Company entered into a $200 million notional rate lock swap, bringing the effective interest rate down from 3.795% to 3.773%.


(4)	As of March 31, 2017 and December 31, 2016, includes a loan with a floating rate of LIBOR plus 2.0%. As of March 31, 2017, the weighted average interest rate of these loans is 5.1%.


(5)	The Company can prepay these senior notes without penalty beginning August 1, 2017.


(6)	The Company can prepay these senior notes without penalty beginning January 1, 2018.


(7)	The Company can prepay these senior notes without penalty beginning July 1, 2018.


(8)	The Company can prepay these senior notes without penalty beginning July 1, 2020.


(9)	The Company can prepay these senior notes without penalty beginning April 1, 2021.


(10)	The Company capitalized interest relating to development activities of $2.0 million and $1.4 million during the three months ended March 31, 2017 and 2016, respectively.

Future Scheduled Maturities—As of March 31, 2017, future scheduled maturities of outstanding debt obligations are as follows ($ in thousands):



	Unsecured Debt			Secured Debt			Total
2017 (remaining nine months)	$	825,000		$	—		$	825,000
2018	600,000			10,648			610,648
2019	770,000			28,770			798,770
2020	—			500,000			500,000
2021	275,000			119,072			394,072
Thereafter	475,000			316,045			791,045
Total principal maturities	2,945,000			974,535			3,919,535
Unamortized discounts and deferred financing costs, net	(21,148		)	(15,992		)	(37,140		)
Total debt obligations, net	$	2,923,852		$	958,543		$	3,882,395

_____________________________________________________________________________

(1)

The Company has $825.0 million of debt obligations maturing in two separate tranches during 2017, and $310.6 million of other debt obligations maturing before the end of May 2018, as listed in the debt obligations table above. The Company's plans to satisfy these obligations primarily consist of accessing the debt and/or equity markets to obtain capital to satisfy the maturing obligations. In addition, management intends to execute on its business strategy of disposing of assets and selling interests in business lines as well as collecting loan repayments from borrowers to further generate available liquidity. Should these sources of capital not be sufficiently available, the Company will slow its pace of making new investments and will need to identify alternative sources of capital. As of May 3, 2017, the Company had approximately $1.2 billion of cash and available capacity under existing borrowing arrangements.

2017 Secured Financing—In March 2017, the Company entered into a $227.0 million secured financing transaction (the "2017 Secured Financing") that accrues interest at 3.795% and matures in April 2027. Subsequent to March 31, 2017, the 2017 Secured Financing was assumed by an entity in which the Company has a 49% noncontrolling interest (refer to Note 18). The 2017 Secured Financing is collateralized by 12 properties including seven ground net leases and one master lease (covering the accounts of five properties). In connection with the 2017 Secured Financing, the Company incurred $7.4 million of lender and third-party fees, substantially all of which was capitalized in "Debt obligations, net" on the Company's consolidated balance sheets.

2016 Secured Term Loan—In December 2016, the Company arranged a $170.0 million delayed draw secured term loan (the "2016 Secured Term Loan"). During the three months ended March 31, 2017, the Company allowed the 2016 Secured Term Loan to expire and replaced the 2016 Secured Term Loan with the 2017 Secured Financing. The 2016 Secured Term Loan was collateralized by the 12 properties that now serve as collateral for the 2017 Secured Financing which were sold subsequent to March 31, 2017.

2016 Senior Secured Credit Facility—In June 2016, the Company entered into a senior secured credit facility of $450.0 million (the "2016 Senior Secured Credit Facility"). In August 2016, the Company upsized the facility to $500.0 million. The initial $450.0 million of the 2016 Senior Secured Credit Facility was issued at 99% of par and the upsize was issued at par. The 2016 Senior Secured Credit Facility initially accrued interest at a floating rate of LIBOR plus 4.50% with a 1.00% LIBOR floor. In January 2017, the Company repriced the 2016 Senior Secured Credit Facility to LIBOR plus 3.75% with a 1.00% LIBOR floor. The 2016 Senior Secured Credit Facility is collateralized 1.25x by a first lien on a fixed pool of assets. Proceeds from principal repayments and sales of collateral are applied to amortize the 2016 Senior Secured Credit Facility. Proceeds received for interest, rent, lease payments and fee income are retained by the Company. The Company may also make optional prepayments, subject to prepayment fees, and is required to repay 0.25% of the principal amount on the first business day of each quarter. Proceeds from the 2016 Senior Secured Credit Facility, together with cash on hand, were primarily used to repay other secured debt.

In connection with the 2016 Senior Secured Credit Facility, the Company incurred $4.5 million of lender fees, substantially all of which was capitalized in "Debt obligations, net" on the Company's consolidated balance sheets. The Company also incurred $6.2 million in third party fees, of which $4.3 million was capitalized in “Debt obligations, net” on the Company's consolidated balance sheets, as it related to new lenders, and $1.9 million was recognized in “Other expense” in the Company's consolidated statements of operations as it related primarily to those lenders from the original facility that modified their debt under the new facility. In connection with the repricing of the 2016 Senior Secured Credit Facility in January 2017, the Company incurred an additional $0.8 million in fees, substantially all of which was recognized in "Other expense."

2015 Secured Revolving Credit Facility—In March 2015, the Company entered into a secured revolving credit facility with a maximum capacity of $250.0 million (the "2015 Secured Revolving Credit Facility"). Borrowings under this credit facility bear interest at a floating rate indexed to one of several base rates plus a margin which adjusts upward or downward based upon the Company's corporate credit rating. An undrawn credit facility commitment fee ranges from 0.375% to 0.50%, based on average utilization each quarter. During the three months ended March 31, 2017, the weighted average cost of the credit facility was 3.46%. Commitments under the revolving facility mature in March 2018. At maturity, the Company may convert outstanding borrowings to a one year term loan which matures in quarterly installments through March 2019. As of March 31, 2017, based on the Company's borrowing base of assets, the Company had $236.0 million of borrowing capacity available under the 2015 Secured Revolving Credit Facility.

Unsecured Notes—In March 2017, the Company issued $375.0 million principal amount of 6.00% senior unsecured notes due April 2022. Proceeds from the offering were primarily used to repay in full the $99.7 million principal amount of 5.85% senior unsecured notes due March 2017 and, subsequent to March 31, 2017, repay in full the $275.0 million principal amount of 9.00% senior unsecured notes due June 2017. In March 2016, the Company repaid its $261.4 million principal amount of 5.875% senior unsecured notes at maturity using available cash. In addition, the Company issued $275.0 million principal amount of 6.50% senior unsecured notes due July 2021. Proceeds from the offering were primarily used to repay in full the $265.0 million principal amount of senior unsecured notes due July 2016 and repay $5.0 million of the 2015 Secured Revolving Credit Facility.

In November 2016, in connection with the retirement of the Company's $200.0 million principal amount of 3.0% senior unsecured convertible notes due November 2016, the Company converted $9.6 million principal amount into 0.8 million shares of our common stock.

Encumbered/Unencumbered Assets—The carrying value of the Company's encumbered and unencumbered assets by asset type are as follows ($ in thousands):



	As of
	March 31, 2017				December 31, 2016
	Encumbered Assets		Unencumbered Assets		Encumbered Assets		Unencumbered Assets
Real estate, net	$	1,005,826	$	470,765	$	881,212	$	610,540
Real estate available and held for sale	—		71,934		—		83,764
Land and development, net	35,165		919,985		35,165		910,400
Loans receivable and other lending investments, net⁽¹⁾⁽²⁾	137,293		1,080,448		172,581		1,142,050
Other investments	—		197,559		—		214,406
Cash and other assets	—		1,212,055		—		639,588
Total	$	1,178,284	$	3,952,746	$	1,088,958	$	3,600,748

_______________________________________________________________________________


(1)	As of March 31, 2017 and December 31, 2016, the amounts presented exclude general reserves for loan losses of $18.4 million and $23.3 million, respectively.


(2)	As of March 31, 2017 and December 31, 2016, the amounts presented exclude loan participations of $181.9 million and $159.1 million, respectively.

Debt Covenants

The Company's outstanding unsecured debt securities contain corporate level covenants that include a covenant to maintain a ratio of unencumbered assets to unsecured indebtedness of at least 1.2x and a covenant not to incur additional indebtedness (except for incurrences of permitted debt), if on a pro forma basis, the Company's consolidated fixed charge coverage ratio, determined in accordance with the indentures governing the Company's debt securities, is 1.5x or lower. If any of the Company's covenants are breached and not cured within applicable cure periods, the breach could result in acceleration of its debt securities unless a waiver or modification is agreed upon with the requisite percentage of the bondholders. If the Company's ability to incur additional indebtedness under the fixed charge coverage ratio is limited, the Company is permitted to incur indebtedness for the purpose of refinancing existing indebtedness and for other permitted purposes under the indentures.

The Company's 2016 Senior Secured Credit Facility and the 2015 Secured Revolving Credit Facility contain certain covenants, including covenants relating to collateral coverage, dividend payments, restrictions on fundamental changes, transactions with affiliates, matters relating to the liens granted to the lenders and the delivery of information to the lenders. In particular, the 2016 Senior Secured Credit Facility requires the Company to maintain collateral coverage of at least 1.25x outstanding borrowings on the facility. The 2015 Secured Revolving Credit Facility is secured by a borrowing base of assets and requires the Company to maintain both collateral coverage of at least 1.5x outstanding borrowings on the facility and a consolidated ratio of cash flow to fixed charges of at least 1.5x. The 2015 Secured Revolving Credit Facility does not require that proceeds from the borrowing base be used to pay down outstanding borrowings provided the collateral coverage remains at least 1.5x outstanding borrowings on the facility. To satisfy this covenant, the Company has the option to pay down outstanding borrowings or substitute assets in the borrowing base. In addition, for so long as the Company maintains its qualification as a REIT, the 2016 Senior Secured Credit Facility and the 2015 Secured Revolving Credit Facility permit the Company to distribute 100% of its REIT taxable income on an annual basis (prior to deducting certain cumulative net operating loss ("NOL") carryforwards). The Company may not pay common dividends if it ceases to qualify as a REIT.

The Company's 2016 Senior Secured Credit Facility and the 2015 Secured Revolving Credit Facility contain cross default provisions that would allow the lenders to declare an event of default and accelerate the Company's indebtedness to them if the Company fails to pay amounts due in respect of its other recourse indebtedness in excess of specified thresholds or if the lenders under such other indebtedness are otherwise permitted to accelerate such indebtedness for any reason. The indentures governing the Company's unsecured public debt securities permit the bondholders to declare an event of default and accelerate the Company's indebtedness to them if the Company's other recourse indebtedness in excess of specified thresholds is not paid at final maturity or if such indebtedness is accelerated.