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Derivative Instruments and Hedging
 12 Months Ended
Dec. 31, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Derivative Instruments and Hedging
Interest Rate Derivatives—We are exposed to risks arising from our business operations, economic conditions and financial markets. To manage these risks, we primarily use interest rate derivatives to hedge our debt and our cash flows, which include interest rate caps and floors. To mitigate nonperformance risk, we routinely use a third party’s analysis of the creditworthiness of the counterparties, which supports our belief that the counterparties’ nonperformance risk is limited. All derivatives are recorded at fair value. Payments from counterparties on in-the-money interest rate caps and floors are recognized as realized gains on our consolidated statements of operations.
The following table presents a summary of our interest rate derivatives entered into over each applicable period:
Year Ended December 31,
202420232022
Interest rate caps:
Notional amount (in thousands)$2,341,742 
(1)
$2,583,271 
(1)
$3,365,941 
(1)
Strike rate low end of range3.10 %2.50 %2.90 %
Strike rate high end of range7.31 %6.90 %5.50 %
Effective date range
February 2024 - December 2024
March 2023 - December 2023January 2022 - December 2022
Termination date range
February 2025 - November 2027
February 2024 - June 2025January 2023 - January 2025
Total cost (in thousands)$15,532 $28,256 $40,119 
Interest rate floors:
Notional amount (in thousands)$121,500 
(1)
$— $— 
Strike rate low end of range2.75 %
Strike rate high end of range2.75 %
Effective date rangeNovember 2024
Termination date rangeNovember 2027
Total cost (in thousands)$754 $— $— 
_______________
(1)These instruments were not designated as cash flow hedges.
We held interest rate instruments as summarized in the table below:
December 31, 2024December 31, 2023
Interest rate caps:
Notional amount (in thousands)$2,477,192 
(1)
$3,351,271 
(1)
Strike rate low end of range3.10 %2.00 %
Strike rate high end of range7.31 %6.90 %
Termination date range
January 2025 - November 2027
February 2024 - June 2025
Aggregate principal balance on corresponding mortgage loans (in thousands)$2,123,951 $2,689,927 
Interest rate floors: (2)
Notional amount (in thousands)$121,500 
(1)
$— 
Strike rate low end of range2.75 %
Strike rate high end of range2.75 %
Termination date rangeNovember 2027
_______________
(1)These instruments were not designated as cash flow hedges.
Compound Embedded Debt Derivative—Based on certain provisions in the Oaktree Credit Agreement, the Company is required to pay an exit fee. Under the applicable accounting guidance, the exit fee is considered an embedded derivative liability that meets the criteria for bifurcation from the debt host. There were other features that were bifurcated, but did not have a material value. The compound embedded debt derivative, consisting of the exit fee and other features which were bifurcated, was initially measured at fair value and the fair value of the embedded debt derivative is estimated at each reporting period. See note 10. On February 12, 2025, we repaid the outstanding balance on the Oaktree Credit Agreement including the $30.0 million exit fee.