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Credit Facility, Notes Payable and Derivative Instruments
 12 Months Ended
Dec. 31, 2025
Credit Facility, Notes Payable and Derivative Instruments  
Credit Facility, Notes Payable and Derivative Instruments

Note 4 – Credit Facility, Notes Payable and Derivative Instruments

Credit Facility

On October 8, 2025, the Operating Partnership, as borrower, and certain of its subsidiaries entered into an amended and restated $900 million unsecured syndicated credit facility with JPMorgan Chase Bank, N.A. as administrative agent (the “Credit Facility”). The Credit Facility consists of (i) $500 million of term loans, which include (a) a $350 million loan that is comprised of three term loans as follows: a $100 million term loan maturing in October 2029 (“Term Loan A-1”); a $100 million term loan maturing in October 2030 (“Term Loan A-2”); and a $150 million term loan maturing in April 2031 (“Term Loan A-3,” collectively the “Term Loan A Tranches”); and (b) a $150 million term loan maturing in February 2028 (“Term Loan B”), and (ii) a $400 million revolver maturing in October 2029 with two, six-month extension options available at the Company’s election (the “Revolver”). The Credit Facility also includes a $500 million accordion feature. Interest rates on amounts outstanding under the Credit Facility equal the term SOFR plus a borrowing spread based on the current pricing grid in the Credit Facility.

The Operating Partnership is subject to a number of financial covenants under the Credit Facility, including, among other things, the following as of the end of each fiscal quarter, (i) a maximum consolidated unsecured leverage ratio of less than 60%, (ii) a maximum consolidated secured leverage ratio of less than 30%, (iii) a maximum consolidated secured recourse leverage ratio of less than 10%, (iv) a minimum fixed charge coverage ratio of 1.50:1.00, (v) a minimum unsecured interest coverage ratio of 1.50:1.00, (vi) a maximum consolidated leverage ratio of less than 60%, and (vii) a minimum net worth of $595.6 million plus 75% of all net proceeds raised through equity offerings subsequent to June 30, 2025. As of December 31, 2025, management believed it complied with all of the financial and non-financial covenants contained in the Credit Facility.

The Company has entered into interest rate swaps to hedge its interest rate risk on the Term Loan A Tranches and Term Loan B through their respective maturities. For additional information see the “Derivative Instruments - Interest Rate Swaps” section herein.

During the year ended December 31, 2025, the Company borrowed $138,300 under the Credit Facility and repaid $111,725, for a net amount borrowed of $26,575. During the year ended December 31, 2024, the Company borrowed $143,800 under the Credit Facility and repaid $99,600, for a net amount borrowed of $44,200. Interest expense incurred on the Credit Facility was $28,193, $25,628, and $25,868 for the years ended December 31, 2025, 2024, and 2023, respectively.

As of December 2025 and 2024, the Company had the following outstanding borrowings under the Credit Facility:

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​

​

​

​

​

​

​

  ​ ​ ​

December 31, 2025

  ​ ​ ​

December 31, 2024

Revolver

​

$

163,175

​

$

136,600

Term Loan A Tranches (1)

​

​

350,000

​

​

350,000

Term Loan B

​

 

150,000

​

 

150,000

Credit Facility, gross

​

​

663,175

​

​

636,600

Less: Unamortized debt issuance costs

​

 

(10,476)

​

 

(4,868)

Credit Facility, net

​

$

652,699

​

$

631,732

(1)

The balance as of December 31, 2024 consisted of one term loan that was replaced by the Term Loan A tranches through the amended and restated Credit Facility on October 8, 2025.

Costs incurred related to the Credit Facility, net of accumulated amortization, are netted against the Company’s “Credit Facility, net of unamortized debt issuance costs” balance in the accompanying Consolidated Balance Sheets. During the year ended December 31, 2025, the Company paid $8,580 related to amendments and modifications to the Credit Facility, and no such costs were incurred during the year ended December 31, 2024. Amortization expense incurred was $2,972, $2,198, and $2,199 for the years ended December 31, 2025, 2024, and 2023, respectively, and is included in the “Interest Expense” line item in the accompanying Consolidated Statements of Operations.

Notes Payable, Net of Debt Issuance Costs

The Company, through certain of its wholly owned subsidiaries, entered into or assumed loans in connection with the acquisitions of the Rosedale and Toledo facilities. As of December 31, 2025 and 2024, the Company had the following outstanding borrowings under these loans:

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​

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​

​

  ​ ​ ​

December 31, 2025

  ​ ​ ​

December 31, 2024

Rosedale loan (1)

​

$

—

​

$

13,158

Toledo loan (2)

​

​

1,153

​

​

1,263

Notes payable, gross

​

​

1,153

​

​

14,421

Unamortized debt issuance costs

​

 

—

​

 

(22)

Notes payable, net

​

$

1,153

​

$

14,399

(1)The Rosedale loan had an annual interest rate of 3.85% and matured on July 31, 2025.
(2)The Toledo loan has an annual interest rate of 5.0% and matures on July 30, 2033.

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Amortization expense incurred related to the debt issuance costs on these loans was $22, $44, and $146, for the years ended December 31, 2025, 2024, and 2023, respectively, and is included in the “Interest Expense” line item in the accompanying Consolidated Statements of Operations. Additionally, in connection with the Cantor Loan defeasance $240 of unamortized debt issuance costs were written off during the year ended December 31, 2023, and included as a component of the “Loss on Extinguishment of Debt” line item in the accompanying Consolidated Statements of Operations.

On March 31, 2016, the Company entered into a $32,097 CMBS loan (the “Cantor Loan”). On December 6, 2023, the Company defeased the Cantor Loan in accordance with the provisions of the underlying loan agreement. The defeasance resulted in a total payment of $31,525 during the year ended December 31, 2023, which consisted of the payment of the outstanding principal balance on December 6, 2023 of $30,897 and transaction costs of $628. The transaction costs are included as a component of the “Loss on Extinguishment of Debt” line item in the accompanying Consolidated Statements of Operations. The total loss on extinguishment of debt during the year ended December 31, 2023, resulting from the defeasance was $868.

The Company made principal payments of $13,268 and $11,544 during the years ended December 31, 2025 and 2024, respectively. Interest expense incurred on these loans was $365, $819, and $2,680 for the years ended December 31, 2025, 2024, and 2023, respectively.

As of December 31, 2025, scheduled principal payments due for each year ended December 31 were as follows:

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​

​

​

2026

​

$

117

2027

​

​

124

2028

​

​

131

2029

​

​

139

2030

​

​

147

Thereafter

​

​

495

Total

​

$

1,153

​

Derivative Instruments - Interest Rate Swaps

As of December 31, 2025, the Company had nine interest rate swaps that are used to manage its interest rate risk by fixing the SOFR component of its term loans through their maturities. Five of the Company’s interest rate swaps related to a term loan that was in place prior to the entry into the third amended and restated Credit Facility on October 8, 2025, with a combined notional value of $350 million. These five interest rate swaps remain in place and fix the SOFR component on that term loan through April 2026 at 1.36%. That term loan was replaced by the Term Loan A Tranches under the third amended and restated Credit Facility. Four of the Company’s interest rate swaps related to Term Loan B with a combined notional value of $150 million that fix the SOFR component on Term Loan B through January 2028 at 2.54%. In addition, the Company entered into seven forward starting interest rate swaps on October 7, 2025, with a combined notional value of $350 million that will be effective upon the April 2026 matruity of the existing five interest rate swaps discussed above. These forward starting interest rate swaps fully hedge the SOFR component of the Term Loan A Tranches through their respective maturities.

The Company records the swaps either as an asset or a liability measured at its fair value at each reporting period. When hedge accounting is applied, the change in the fair value of derivatives designated and that qualify as cash flow hedges is (i) recorded in accumulated other comprehensive income in the equity section of the Company’s Consolidated Balance Sheets and (ii) subsequently reclassified into earnings as interest expense for the period that the hedged forecasted transactions affect earnings. If specific hedge accounting criteria are not met, changes in the Company’s derivative instruments’ fair value are recognized currently as an adjustment to net income. As of December 31, 2025 and 2024, all of the Company’s swaps met the criteria for hedge accounting.

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The Company’s interest rate swaps are not traded on an exchange. The Company’s interest rate swaps are recorded at fair value based on a variety of observable inputs including contractual terms, interest rate curves, yield curves, measure of volatility, and correlations of such inputs. The Company measures its derivatives at fair value on a recurring basis based on the expected size of future cash flows on a discounted basis and incorporates a measure of non-performance risk. The fair values are based on Level 2 inputs within the framework of ASC Topic 820. The Company considers its own credit risk, as well as the credit risk of its counterparties, when evaluating the fair value of its derivative instruments.

The fair value of the Company’s interest rate swaps was an asset of $6,102 and $18,613 as of December 31, 2025 and 2024, respectively. The balances are included in the “Derivative Assets” line item on the Company’s Consolidated Balance Sheets as of December 31, 2025 and 2024, respectively.

The table below details the components of the amounts presented on the accompanying Consolidated Statements of Comprehensive Income recognized on the Company’s interest rate swap agreements designated as cash flow hedges:

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Year Ended December 31, 

​

2025

  ​ ​ ​

2024

  ​ ​ ​

2023

Amount of gain recognized in other comprehensive loss

$

(308)

​

$

(10,683)

​

$

(6,056)

Amount of gain reclassified from accumulated other comprehensive income into interest expense

 

12,819

​

 

17,195

​

 

15,605

Total change in accumulated other comprehensive income

$

12,511

​

$

6,512

​

$

9,549

​

During the next twelve months, the Company estimates that an additional $3,822 will be reclassified as a decrease to interest expense. Additionally, during the years ended December 31, 2025, 2024, and 2023, the Company recorded total interest expense in its Consolidated Statements of Operations of $31,754, $28,689, and $30,893, respectively.

Weighted-Average Interest Rate and Term

The weighted average interest rate and term of the Company’s debt was 3.74% and 4.1 years, respectively, at December 31, 2025, compared to 3.75% and 2.0 years, respectively, as of December 31, 2024.