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Debt
 12 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
Debt

Note 6 —Debt

Non-recourse property debt

We finance apartment communities in our portfolio primarily using property-level, non-recourse, long-dated, fixed-rate debt. The following table summarizes non-recourse property debt as of December 31, 2024 and 2023 (in thousands):

 

 

 

 

 

 

 

 

As of December 31,

 

 

Maturity Date

 

Contractual Interest Rate
Range

 

Weighted-Average Interest Rate

 

2024

 

 

2023

 

Fixed-rate property debt

June 1, 2029 to June 1, 2033

 

2.78% to 4.68%

 

4.39%

 

$

689,885

 

 

$

771,202

 

Variable-rate property debt

 

 

 

 

 

 

 

—

 

 

 

81,300

 

Total non-recourse property debt

 

 

 

 

 

 

$

689,885

 

 

$

852,502

 

 

 

 

 

 

 

 

 

 

 

 

 

Assumed debt fair value adjustment, net of accumulated amortization

 

 

 

 

 

 

 

—

 

 

 

871

 

Debt issuance costs, net of accumulated amortization

 

 

 

 

 

 

 

(4,465

)

 

 

(7,075

)

Total non-recourse property debt, net

 

 

 

 

 

 

$

685,420

 

 

$

846,298

 

Principal and interest on our non-recourse property debt are generally payable monthly or in monthly interest-only payments with balloon payments due at maturity. As of December 31, 2024, our property debt was secured by 16 properties with an aggregate net book value of $329.3 million. These non-recourse property debt instruments contain financial covenants common to the type of borrowing, and as of December 31, 2024, we were in compliance with all such covenants.

As of December 31, 2024, the scheduled principal amortization and maturity payments for the non-recourse property debt were as follows (in thousands):

 

 

Amortization

 

 

Maturities

 

 

Total

 

2025

$

1,472

 

 

$

—

 

 

$

1,472

 

2026

 

1,522

 

 

 

—

 

 

 

1,522

 

2027

 

1,573

 

 

 

—

 

 

 

1,573

 

2028

 

1,627

 

 

 

—

 

 

 

1,627

 

2029

 

1,682

 

 

 

179,646

 

 

 

181,328

 

Thereafter

 

2,781

 

 

 

499,582

 

 

 

502,363

 

   Total

$

10,657

 

 

$

679,228

 

 

$

689,885

 

Non-recourse construction loans

Our construction loans, which are primarily non-recourse loans except for customary construction loan guarantees, are summarized in the following table as of December 31, 2024 and 2023 (in thousands):

 

 

 

 

 

 

 

 

As of December 31,

 

 

Maturity Date

 

Contractual Interest Rate
Range

 

Weighted-Average Interest Rate

 

2024

 

 

2023

 

Fixed-rate construction loans

December 23, 2025 to December 23, 2052

 

3.25% to 13.00%

 

7.34%

 

$

261,792

 

 

$

41,829

 

Variable-rate construction loans

June 3, 2025 to October 1, 2028

 

7.09% to 8.86%

 

7.56%

 

 

131,958

 

 

 

267,692

 

Total non-recourse construction loans

 

 

 

 

 

 

$

393,750

 

 

$

309,521

 

 

 

 

 

 

 

 

 

 

 

 

 

Assumed debt fair value adjustment, net of accumulated amortization

 

 

 

 

 

 

 

(339

)

 

 

(351

)

Debt issuance costs, net of accumulated amortization

 

 

 

 

 

 

 

(8,171

)

 

 

(7,727

)

Total non-recourse construction loans, net

 

 

 

 

 

 

$

385,240

 

 

$

301,443

 

Interest-only payments on our construction loans are generally payable monthly with balloon payments due at maturity. As of December 31, 2024, our construction debt was secured by 4 properties with an aggregate net book value of $554.6 million.

As of December 31, 2024, the scheduled principal maturity payments, prior to the consideration of extension options, for the non-recourse construction loans were as follows (in thousands):

 

 

 

Principal Maturity Payments

 

2025

 

$

153,843

 

2026

 

 

—

 

2027

 

 

—

 

2028

 

 

233,407

 

2029

 

 

—

 

Thereafter

 

 

6,500

 

   Total

 

$

393,750

 

 

Revolving Credit Facility

In December 2020, we entered into a credit agreement that provides for a $150.0 million secured credit facility, with a $20.0 million swingline loan sub-facility and a $30.0 million letter of credit sub-facility. We can request incremental commitments under the credit agreement up to an aggregate principal amount of $300.0 million. Our revolving secured credit facility matures in December 2025. The revolving loans (other than the swingline) will bear interest, at our option, at a per annum rate equal to (a) SOFR plus a margin of 2.11448% or (b) a base rate plus a margin of 1.00%. Swingline loans made under the revolving credit facility will bear interest at a per annum rate equal to the base rate plus a margin of 1.00%. The base rate is defined as a fluctuating per annum rate of interest equal to the highest of (x) the overnight bank funding rate as reported by the Federal Reserve Bank of New York, plus 0.5%, (y) PNC Bank, National Association’s prime rate and (z) the daily SOFR Rate plus 1.00%. If the SOFR Rate determined under any referenced method would be less than 0.25%, such rate shall be deemed 0.25%. We may terminate or, from time to time, reduce the aggregate amount of commitments.

As of December 31, 2024, we had capacity to borrow $148.5 million on our secured revolving credit facility. Under our secured revolving credit facility, we have agreed to maintain a fixed charge coverage ratio of 1.25x, minimum adjusted tangible net worth of $625.0 million, and maximum leverage of 60.0% as defined in the credit agreement, among other customary covenants. We are in compliance with these covenants as of December 31, 2024.

Notes Payable to AIR

In July 2022, we completed the prepayment of $534.1 million of Notes Payable to AIR, which was entered into on December 14, 2020. As a result, we incurred $17.4 million of spread maintenance costs, which are included in Interest expense in our Consolidated Statements of Operations. For the year ended December 31, 2022, we recognized interest expense of $13.7 million associated with the Notes Payable to AIR, which is included in Interest expense in our Consolidated Statements of Operations.