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Mortgage and Other Indebtedness, Net (Tables) | 9 Months Ended
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Sep. 30, 2017
Debt Disclosure [Abstract] |
Schedule of mortgage and other indebtedness |
Description |  | Issued (1) |  | Amount |  | Interest Rate (2) |  | Maturity Date (3)
2026 Notes |  | December 2016 / September 2017 (4) |  | $ | 625,000 |  |  | 5.95% |  | December 2026
2024 Notes |  | October 2014 |  | 300,000 |  |  | 4.60% |  | October 2024
2023 Notes |  | November 2013 |  | 450,000 |  |  | 5.25% |  | December 2023
(1) | Issued by the Operating Partnership. CBL is a limited guarantor of the Operating Partnership's obligations under the Notes as described above.
(2) | Interest is payable semiannually in arrears. Interest was payable for the 2026 Notes, the 2024 Notes and the 2023 Notes beginning June 15, 2017, April 15, 2015, and June 1, 2014, respectively. The interest rate for the 2024 Notes and the 2023 Notes is subject to an increase ranging from 0.25% to 1.00% from time to time if, on or after January 1, 2016 and prior to January 1, 2020, the ratio of secured debt to total assets of the Company, as defined, is greater than 40% but less than 45%. The required ratio of secured debt to total assets for the 2026 Notes is 40% or less. As of September 30, 2017, this ratio was 24% as shown below.
(3) | The Notes are redeemable at the Operating Partnership's election, in whole or in part from time to time, on not less than 30 days and not more than 60 days' notice to the holders of the Notes to be redeemed. The 2026 Notes, the 2024 Notes and the 2023 Notes may be redeemed prior to September 15, 2026, July 15, 2024, and September 1, 2023, respectively, for cash at a redemption price equal to the aggregate principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but not including, the redemption date and a make-whole premium calculated in accordance with the indenture. On or after the respective dates noted above, the Notes are redeemable for cash at a redemption price equal to the aggregate principal amount of the Notes to be redeemed plus accrued and unpaid interest. If redeemed prior to the respective dates noted above, each issuance of Notes is redeemable at the treasury rate plus 0.50%, 0.35% and 0.40% for the 2026 Notes, the 2024 Notes and the 2023 Notes, respectively.
(4) | On September 1, 2017, the Operating Partnership issued and sold an additional $225,000 of the 2026 Notes. The first interest payment with respect to the additional issuance will occur on December 15, 2017. After deducting underwriting discounts and other offering expenses, the net proceeds from the sale were approximately $218,913. The Operating Partnership used the net proceeds to reduce amounts outstanding under its unsecured credit facilities and for general business purposes.
Mortgage and other indebtedness, net consisted of the following:
| September 30, 2017 |  | December 31, 2016
| Amount |  | Weighted- Average Interest Rate (1) |  | Amount |  | Weighted- Average Interest Rate (1)
Fixed-rate debt: |  |  |  |  |  |  |  |
Non-recourse loans on operating properties | $ | 1,807,519 |  |  | 5.34% |  | $ | 2,453,628 |  |  | 5.55%
Senior unsecured notes due 2023 (2) | 446,868 |  |  | 5.25% |  | 446,552 |  |  | 5.25%
Senior unsecured notes due 2024 (3) | 299,944 |  |  | 4.60% |  | 299,939 |  |  | 4.60%
Senior unsecured notes due 2026 (4) | 615,669 |  |  | 5.95% |  | 394,260 |  |  | 5.95%
Total fixed-rate debt | 3,170,000 |  |  | 5.37% |  | 3,594,379 |  |  | 5.48%
Variable-rate debt: |  |  |  |  |  |  |  |  |
Non-recourse term loans on operating properties | 10,868 |  |  | 3.04% |  | 19,055 |  |  | 3.13%
Recourse term loans on operating properties | 89,612 |  |  | 3.87% |  | 24,428 |  |  | 3.29%
Construction loan (5) | — |  |  | —% |  | 39,263 |  |  | 3.12%
Unsecured lines of credit | 79,970 |  |  | 2.43% |  | 6,024 |  |  | 1.82%
Unsecured term loans | 885,000 |  |  | 2.69% |  | 800,000 |  |  | 2.04%
Total variable-rate debt | 1,065,450 |  |  | 2.77% |  | 888,770 |  |  | 2.15%
Total fixed-rate and variable-rate debt | 4,235,450 |  |  | 4.72% |  | 4,483,149 |  |  | 4.82%
Unamortized deferred financing costs | (19,272 | ) |  |  |  | (17,855 | ) |  |
Total mortgage and other indebtedness, net | $ | 4,216,178 |  |  |  |  | $ | 4,465,294 |  |  |
(1) | Weighted-average interest rate includes the effect of debt premiums and discounts, but excludes amortization of deferred financing costs.
(2) | The balance is net of an unamortized discount of $3,132 and $3,448 as of September 30, 2017 and December 31, 2016, respectively.
(3) | The balance is net of an unamortized discount of $56 and $61 as of September 30, 2017 and December 31, 2016, respectively.
(4) | The balance is net of an unamortized discount of $9,331 and $5,740 as of September 30, 2017 and December 31, 2016, respectively. In September 2017, the Operating Partnership issued and sold an additional $225,000 of the series of 2026 Notes. See further information below.
(5) | The Outlet Shoppes at Laredo opened in April 2017 and the construction loan balance is included in recourse term loans on operating properties as of September 30, 2017.
Schedule of line of credit facilities | The following summarizes certain information about the Company's unsecured lines of credit as of September 30, 2017:
|  | Total Capacity |  | Total Outstanding |  | Maturity Date |  | Extended Maturity Date |
Wells Fargo - Facility A |  | $ | 500,000 |  |  | $ | — |  | (1) |  | October 2019 |  | October 2020 | (2)
First Tennessee |  | 100,000 |  |  | 36,034 |  | (3) |  | October 2019 |  | October 2020 | (4)
Wells Fargo - Facility B |  | 500,000 |  |  | 43,936 |  | (5) |  | October 2020 |  |  |
|  | $ | 1,100,000 |  |  | $ | 79,970 |  | (6) |  |  |  |  |
(1) | There was $150 outstanding on this facility as of September 30, 2017 for letters of credit. Up to $30,000 of the capacity on this facility can be used for letters of credit.
(2) | The extension option is at the Company's election, subject to continued compliance with the terms of the facility, and has a one-time extension fee of 0.15% of the commitment amount of the credit facility.
(3) | Up to $20,000 of the capacity on this facility can be used for letters of credit.
(4) | The extension option on the facility is at the Company's election, subject to continued compliance with the terms of the facility, and has a one-time extension fee of 0.20% of the commitment amount of the credit facility.
(5) | Up to $30,000 of the capacity on this facility can be used for letters of credit.
(6) | See debt covenant section below for limitation on excess capacity.
Schedule of covenant compliance | The following presents the Company's compliance with key covenant ratios, as defined, of the credit facilities and term loans as of September 30, 2017:
Ratio |  | Required |  | Actual
Debt to total asset value |  | < 60% |  | 49 | % |
Unsecured indebtedness to unencumbered asset value (1) |  | < 60% |  | 46 | % | (2)
Unencumbered NOI to unsecured interest expense |  | > 1.75x |  | 3.3 | x |
EBITDA to fixed charges (debt service) |  | > 1.5x |  | 2.5 | x |
(1) | The debt covenant was modified in the third quarter of 2017 to reduce the ratio from 62.5% to 60.0%. The definition of unencumbered asset value was also modified with respect to the assets that are included in the unencumbered asset pool.
(2) | The debt covenant limits the total amount of unsecured indebtedness the Company may have outstanding, which varies over time based on the ratio. Based on the Company’s outstanding unsecured indebtedness as of September 30, 2017, the total amount available to the Company to borrow on its lines of credit was $329,190 less than the total capacity of the lines of credit resulting in total availability of $690,840 as of September 30, 2017.
The following presents the Company's compliance with key covenant ratios, as defined, of the Notes as of September 30, 2017:
Ratio |  | Required |  | Actual
Total debt to total assets |  | < 60% |  | 52%
Secured debt to total assets |  | < 45% (1) |  | 24%
Total unencumbered assets to unsecured debt |  | > 150% |  | 209%
Consolidated income available for debt service to annual debt service charge |  | > 1.5x |  | 3.1x
(1) | On January 1, 2020 and thereafter, secured debt to total assets must be less than 40% for the 2023 Notes and the 2024 Notes. The required ratio of secured debt to total assets for the 2026 Notes is 40% or less.
Schedule of fixed rate loans | The loan, secured by the related unconsolidated property, was retired in 2017:
Date |  | Property |  | Interest Rate at Repayment Date |  | Scheduled Maturity Date |  | Principal Balance Repaid (1)
July |  | Gulf Coast Town Center - Phase III (1) |  | 3.13% |  | July 2017 |  | $ | 4,118 |
(1) | The Company loaned the unconsolidated affiliate, JG Gulf Coast Town Center, LLC, the amount necessary to retire the loan and received a mortgage note receivable in return. See Note 8 for more information.
The Company repaid the following loans, secured by the related consolidated Properties, in 2017:
Date |  | Property |  | Interest Rate at Repayment Date |  | Scheduled Maturity Date |  | Principal Balance Repaid (1)
January |  | The Plaza at Fayette |  | 5.67% |  | April 2017 |  | $ | 37,146 |
January |  | The Shoppes at St. Clair Square |  | 5.67% |  | April 2017 |  | 18,827 |
February |  | Hamilton Corner |  | 5.67% |  | April 2017 |  | 14,227 |
March |  | Layton Hills Mall |  | 5.66% |  | April 2017 |  | 89,526 |
April |  | The Outlet Shoppes at Oklahoma City (2) |  | 5.73% |  | January 2022 |  | 53,386 |
April |  | The Outlet Shoppes at Oklahoma City - Phase II (2) |  | 3.53% |  | April 2019 |  | 5,545 |
April |  | The Outlet Shoppes at Oklahoma City - Phase III (2) |  | 3.53% |  | April 2019 |  | 2,704 |
September |  | Hanes Mall (3) |  | 6.99% |  | October 2018 |  | 144,325 |
September |  | The Outlet Shoppes at El Paso |  | 7.06% |  | December 2017 |  | 61,561 |
|  |  |  |  |  |  |  | $ | 427,247 |
(1) | The Company retired the loans with borrowings from its credit facilities unless otherwise noted.
(2) | The loan was retired in conjunction with the sale of the property which secured the loan. See Note 4 for more information. The Company recorded an $8,500 loss on extinguishment of debt due to a prepayment fee on the early retirement.
(3) | The Company recorded a $371 loss on extinguishment of debt due to a prepayment fee on the early retirement.
The following is a summary of the Company's 2017 dispositions for which the title to the consolidated mall securing the related fixed-rate debt was transferred to the lender in satisfaction of the non-recourse debt:
Date |  | Property |  | Interest Rate at Repayment Date |  | Scheduled Maturity Date |  | Balance of Non-recourse Debt |  | Gain on Extinguishment of Debt
January |  | Midland Mall |  | 6.10% |  | August 2016 |  | $ | 31,953 |  |  | $ | 3,760 |
June |  | Chesterfield Mall |  | 5.74% |  | September 2016 |  | 140,000 |  |  | 29,187 |
August |  | Wausau Center |  | 5.85% |  | April 2021 |  | 17,689 |  |  | 6,851 |
|  |  |  |  |  |  |  | $ | 189,642 |  |  | $ | 39,798 |
Schedule of principal repayments | As of September 30, 2017, the scheduled principal amortization and balloon payments on all of the Company’s consolidated mortgage and other indebtedness, excluding extensions available at the Company’s option, are as follows:
2017 |  | $ | 134,159 |
2018 |  | 667,320 |
2019 |  | 329,846 |
2020 |  | 551,004 |
2021 |  | 498,168 |
Thereafter (1) |  | 2,067,125 |
|  | 4,247,622 |
Unamortized premiums and discounts, net |  | (12,172 | )
Unamortized deferred financing costs |  | (19,272 | )
Total mortgage and other indebtedness, net |  | $ | 4,216,178 |
Schedule of gain (loss) recognized in other comprehensive income (loss) | The following tables provide further information relating to the Company’s interest rate derivatives that were designated as cash flow hedges of interest rate risk in 2016:
|  | Gain Recognized in OCI/L (Effective Portion) |  | Location of Losses Reclassified from AOCI into Earnings (Effective Portion) |  | Loss Recognized in Earnings (Effective Portion) |  | Location of Gain Recognized in Earnings (Ineffective Portion) |  | Gain Recognized in Earnings (Ineffective Portion)
Hedging Instrument |  | Nine Months Ended September 30, |  |  | Nine Months Ended September 30, |  |  | Nine Months Ended September 30,
| 2017 |  | 2016 |  |  | 2017 |  | 2016 |  |  | 2017 |  | 2016
Interest rate contracts |  | $ | — |  |  | $ | 434 |  |  | Interest Expense |  | $ | — |  |  | $ | (443 | ) |  | Interest Expense |  | $ | — |  |  | $ | — |

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