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DEBT | 9 Months Ended
--- | ---
Sep. 30, 2024
Debt Disclosure [Abstract] |
DEBT | DEBT The following table summarizes the Company’s secured and unsecured debt at September 30, 2024 and December 31, 2023.
| (in thousands) |
| September 30, 2024 |  | December 31, 2023 |
| Carrying Amount | Weighted Average Interest Rate |  | Carrying Amount | Weighted Average Interest Rate | Weighted Average Maturity in Years at September 30, 2024
Lines of credit (1) | $ | 39,000 | 6.70 | % |  | $ | 30,000 |  | 6.74 | % | 3.82
Unsecured senior notes (2)(4) | 300,000 | 3.12 | % |  | 300,000 |  | 3.12 | % | 5.87
Unsecured debt | 339,000 |  |  | 330,000 |  |  | 5.64
Mortgages payable - Fannie Mae credit facility (4) | 198,850 | 2.78 | % |  | 198,850 |  | 2.78 | % | 6.81
Mortgages payable - other (3)(4) | 387,294 | 4.05 | % |  | 392,274 |  | 4.05 | % | 5.03
Secured debt | 586,144 |  |  | 591,124 |  |  | 5.63
Subtotal | 925,144 | 3.59 | % |  | 921,124 |  | 3.54 | % | 5.63
Premiums and discounts, net | (345) |  |  | (1,134) |  |  |
Deferred financing costs, net | (3,533) |  |  | (3,968) |  |  |
Total debt | $ | 921,266 |  |  | $ | 916,022 |  |  |
(1)Interest rates on lines of credit are variable and exclude any unused facility fees and amounts reclassified from accumulated other comprehensive income (loss) into interest expense from terminated interest rate swaps. (2)Included within notes payable on the Condensed Consolidated Balance Sheets. (3)Represents apartment communities encumbered by mortgages; 14 at September 30, 2024 and December 31, 2023. (4)Interest rate is fixed. As of September 30, 2024, 45 apartment communities were not encumbered by mortgages and were available to provide credit support for the unsecured borrowings. The Company’s primary unsecured credit facility (“Unsecured Credit Facility” or “Facility”) is a revolving, multi-bank line of credit, with the Bank of Montreal serving as administrative agent. The line of credit has total commitments and borrowing capacity of $250.0 million, based on the value of unencumbered properties. As of September 30, 2024, there was $39.0 million outstanding on this line of credit. Therefore the additional borrowing availability was $211.0 million. On July 26, 2024, the Unsecured Credit Facility was amended to extend maturity and to modify the leverage-based margin ratios applicable to borrowings. As amended, this credit facility matures in July 2028, with an option to extend maturity for up to two additional six-month periods and has an accordion option to increase borrowing capacity up to $400.0 million. The Secured Overnight Financing Rate (“SOFR”) is the benchmark alternative reference rate under the Facility. On July 26, 2024, the Unsecured Credit Facility was amended to extend the maturity of the facility to July 2028 and to modify the leverage-based margin rates applicable to borrowings. As amended, the interest rates on the line of credit are based on the consolidated leverage ratio, at the Company’s option, on either the lender’s base rate plus a margin, ranging from 20-80 basis points, or daily or term SOFR, plus a margin that ranges from 120-180 basis points with the consolidated leverage ratio described under the Third Amended and Restated Credit Agreement, as amended. The Unsecured Credit Facility and unsecured senior notes are subject to customary financial covenants and limitations. The Company believes that it was in compliance with all such financial covenants and limitations as of September 30, 2024. In September 2024, Centerspace entered into a line of credit agreement with borrowing capacity of up to $10.0 million and pricing based on SOFR. This operating line of credit terminates in September 2025 and is designed to enhance treasury management activities and more effectively manage cash balances. Centerspace had a $6.0 million operating line of credit with pricing based on SOFR that matured on August 31, 2024. As of September 30, 2024 and December 31, 2023, there was no outstanding balance on these lines of credit. Centerspace had a private shelf agreement with PGIM, Inc., an affiliate of Prudential Financial, Inc., and certain affiliates of PGIM, Inc. (collectively, “PGIM”) under which the Company issued $175.0 million in unsecured senior promissory notes (“Unsecured Shelf Notes”). On October 28, 2024, the shelf agreement was amended to extend the period of time during which Centerspace may borrow money to October 2027 and to increase the borrowing capacity to $300.0 million. The Company also has a separate private note purchase agreement with PGIM and certain other lenders for the issuance of $125.0 million of senior unsecured promissory notes (“Unsecured Club Notes”, and, collectively with the Unsecured Shelf Notes, the “unsecured senior notes”), of which all $125.0 million was issued in September 2021. The following table shows the notes issued under both agreements as of September 30, 2024 and December 31, 2023.
| (in thousands) |  |  |  |
| Amount |  | Maturity Date |  | Interest Rate
Series A | $ | 75,000 |  |  | September 13, 2029 |  | 3.84 | %
Series B | $ | 50,000 |  |  | September 30, 2028 |  | 3.69 | %
Series C | $ | 50,000 |  |  | June 6, 2030 |  | 2.70 | %
Series 2021-A | $ | 35,000 |  |  | September 17, 2030 |  | 2.50 | %
Series 2021-B | $ | 50,000 |  |  | September 17, 2031 |  | 2.62 | %
Series 2021-C | $ | 25,000 |  |  | September 17, 2032 |  | 2.68 | %
Series 2021-D | $ | 15,000 |  |  | September 17, 2034 |  | 2.78 | %
Centerspace has a $198.9 million Fannie Mae Credit Facility Agreement (the “FMCF”). The FMCF is secured by mortgages on 11 apartment communities. The notes are interest-only, with varying maturity dates of 7, 10, and 12 years, and a blended, weighted average interest rate of 2.78%. As of September 30, 2024 and December 31, 2023, the FMCF had a balance of $198.9 million. The FMCF is included within mortgages payable on the Condensed Consolidated Balance Sheets. As of September 30, 2024, Centerspace owned 14 apartment communities that served as collateral for mortgage loans, in addition to the apartment communities secured by the FMCF. All of these mortgage loans were non-recourse to the Company other than for standard carve-out obligations. As of September 30, 2024, the Company believes that there were no material defaults or instances of material noncompliance in regard to any of these mortgage loans. As of September 30, 2024 and December 31, 2023, the mortgage loans had a balance of $387.3 million and $392.3 million, respectively, excluding unamortized premiums and discounts. The mortgage loans are included within mortgages payable on the Condensed Consolidated Balance Sheets. The aggregate amount of required future principal payments on lines of credit, notes payable, and mortgages payable as of September 30, 2024, was as follows:
| (in thousands)
2024 (remainder) | $ | 1,880 |
2025 | 36,290 |
2026 | 102,809 |
2027 | 48,666 |
2028 | 157,321 |
Thereafter | 578,178 |
Total payments | 925,144 |
Premiums and discounts, net | (345) |
Deferred financing costs, net | (3,533) |
Total | $ | 921,266 |

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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. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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