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DERIVATIVE INSTRUMENTS | 9 Months Ended
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Sep. 30, 2021
INTEREST RATE CAP AGREEMENTS |
DERIVATIVE INSTRUMENTS | ​ ​ ​ ​ ​ 8 – DERIVATIVE INSTRUMENTS ​ The Company is exposed to interest rate risk on its floating rate debt. As of September 30, 2021, the Company had three interest rate cap agreements outstanding to manage interest costs and the risk associated with variable interest rates. The three interest rate cap agreements have been designated and qualify as cash flow hedges. The premium paid is recognized in income on a rational basis, and all changes in the value of the caps are deferred in Accumulated other comprehensive income (“AOCI”) and are subsequently reclassified into Interest expense in the period when the hedged interest affects earnings. ​ The following table summarizes the interest rate cap agreements in place as of September 30, 2021. ​
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Interest Rate Cap Detail | ​ | ​ | Notional Amount Outstanding
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | September 30,
Trade date | ​ | Cap Rate | ​ | Start Date | ​ | End Date |  | ​ | 2021
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
March 25, 2021 | ​ | 0.75 | % | ​ | April 29, 2021 | ​ | March 28, 2024 | ​ | $ | 50,000
July 29, 2020 | ​ | 0.75 | % | ​ | July 31, 2020 | ​ | December 29, 2023 | ​ | ​ | 100,000
March 6, 2020 | ​ | 1.50 | % | ​ | March 10, 2020 | ​ | March 10, 2023 | ​ | ​ | 50,000
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 200,000
​ The Company records the fair value of the interest rate caps as Fair value of derivatives in the non-current asset section on its Condensed Consolidated Balance Sheets. The Company has elected to use the income approach to value the interest rate derivatives using observable Level 2 market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present amount (discounted) reflecting current market expectations about those future amounts. Level 2 inputs for derivative valuations are limited to quoted prices for similar assets or liabilities in active markets (specifically futures contracts) and inputs other than quoted prices that are observable for the asset or liability (specifically LIBOR cash and swap rates, implied volatility, basis swap adjustments, and credit risk at commonly quoted intervals). Mid-market pricing is used as a practical expedient for most fair value measurements. ​ The Company recorded a $98 loss and a $40 gain for the three and nine months ended September 30, 2021, respectively, in AOCI. The estimated income that is currently recorded in AOCI as of September 30, 2021 that is expected to be reclassified into earnings within the next twelve months is $169. ​
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The Effect of Fair Value and Cash Flow Hedge Accounting on the Statement of Operations
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​ | ​ | For the Three Months Ended September 30, | ​ | For the Nine Months Ended September 30, | ​
​ | ​ | 2021 |  | 2020 |  | 2021 |  | 2020 | ​
​ | ​ | Interest Expense | ​ | Interest Expense | ​ | Interest Expense | ​ | Interest Expense | ​
Total amounts of income and expense line items presented in the statement of operations in which the effects of fair value or cash flow hedges are recorded | ​ | $ | 3,943 | ​ | $ | 5,097 | ​ | $ | 12,955 | ​ | $ | 17,515 | ​
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The effects of fair value and cash flow hedging | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
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Gain or (loss) on cash flow hedging relationships in Subtopic 815-20: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest contracts: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Amount of gain or (loss) reclassified from AOCI to income | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​
Premium excluded and recognized on an amortized basis | ​ | ​ | 43 | ​ | ​ | — | ​ | ​ | 153 | ​ | ​ | — | ​
Amount of gain or (loss) reclassified from AOCI to income as a result that a forecasted transaction is no longer probable of occurring | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​
​ The following table shows the interest rate cap assets as of September 30, 2021: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | September 30, | ​
Derivatives designated as hedging instruments | ​ | Balance Sheet Location | ​ | ​ | 2021 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​
Interest rate caps | ​ | Fair value of derivative instruments - noncurrent | ​ | $ | 424 | ​
​ ​ ​ The components of AOCI included in the accompanying Condensed Consolidated Balance Sheet consists of net unrealized gain (loss) on cash flow hedges as of September 30, 2021. ​
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AOCI — January 1, 2021 | ​ | $ | — | ​
​ | ​ | ​ | ​ | ​
Amount recognized in OCI on derivative, intrinsic | ​ |  | (59) | ​
Amount recognized in OCI on derivative, excluded | ​ |  | 99 | ​
Amount reclassified from OCI into income | ​ |  | — | ​
​ | ​ | ​ | ​ | ​
AOCI — September 30, 2021 | ​ | $ | 40 | ​
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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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