Notes Payable, Revolving Credit Facility, Interest and Amortization of Deferred Debt Costs

The principal amount of the Company’s outstanding debt totaled approximately $875.0 million at September 30, 2016, of which approximately $837.4 million was fixed-rate debt and approximately $37.6 million was variable rate debt, including

$23.0 million outstanding on the Company's unsecured revolving credit facility. The carrying value of the properties collateralizing the notes payable totaled approximately $845.9 million as of September 30, 2016.

At September 30, 2016, the Company had a $275.0 million unsecured revolving credit facility, which can be used for working capital, property acquisitions, development projects or letters of credit. The revolving credit facility matures on June 23, 2018, and may be extended by the Company for one additional year subject to the Company’s satisfaction of certain conditions. Saul Centers and certain consolidated subsidiaries of the Operating Partnership have guaranteed the payment obligations of the Operating Partnership under the revolving credit facility. Letters of credit may be issued under the revolving credit facility. On September 30, 2016, based on the value of the Company’s unencumbered properties, approximately $251.6 million was available under the line, $23.0 million was outstanding and approximately $448,000 was committed for letters of credit. The interest rate under the facility is variable and equals the sum of one-month LIBOR and a margin that is based on the Company’s leverage ratio, and which can range from 145 basis points to 200 basis points. As of

September 30, 2016, the margin was 145 basis points.

At September 30, 2016, the Company had a $71.6 million construction-to-permanent loan, with $68.3 million outstanding, which is secured by and used to partially finance the construction of Park Van Ness.

Saul Centers is a guarantor of the revolving credit facility, of which the Operating Partnership is the borrower. The Operating Partnership is the guarantor of (a) a portion of the Metro Pike Center bank loan (approximately $7.8 million of the $14.6 million outstanding at September 30, 2016) and (b) the $71.6 million Park Van Ness construction-to-permanent loan, which guarantee will be reduced and eventually eliminated subject to the achievement of certain leasing and cash flow levels. The fixed-rate notes payable are all non-recourse.

At December 31, 2015, the principal amount of the Company’s outstanding debt totaled approximately $875.2 million, of which $832.4 million was fixed rate debt and $42.8 million was variable rate debt, including $28.0 million outstanding on the Company’s unsecured revolving credit facility. The carrying value of the properties collateralizing the notes payable totaled $856.8 million as of December 31, 2015.

At September 30, 2016, the scheduled maturities of debt, including scheduled principal amortization, for years ending December 31, were as follows:



(In thousands)	Balloon Payments			Scheduled Principal Amortization		Total
October 1 through December 31, 2016	$	—		$	6,284	$	6,284
2017	14,442			25,766		40,208
2018	50,748		(a)	25,901		76,649
2019	60,793			24,614		85,407
2020	61,163			21,892		83,055
2021	11,012			21,404		32,416
Thereafter	444,679			106,312		550,991
Principal amount	$	642,837		$	232,173	875,010
Unamortized deferred debt costs						7,703
Net						$	867,307

(a) Includes $23.0 million outstanding under the line of credit.

Interest expense and amortization of deferred debt costs for the three and nine months ended September 30, 2016 and 2015, were as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
(In thousands)	2016			2015			2016			2015
Interest incurred	$	11,691		$	11,489		$	35,027		$	34,287
Amortization of deferred debt costs	339			340			1,003			1,094
Capitalized interest	(506		)	(600		)	(1,762		)	(1,393		)
	$	11,524		$	11,229		$	34,268		$	33,988