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Debt Obligations | 9 Months Ended
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Sep. 30, 2017
Debt Disclosure [Abstract] |
DEBT OBLIGATIONS | 6. DEBT OBLIGATIONS The following table sets forth information regarding the Company’s consolidated debt obligations outstanding at September 30, 2017 and December 31, 2016 (in thousands):
| September 30, 2017 |  |  | December 31, 2016 |  |  | Effective Interest Rate |  |  | Maturity Date |
MORTGAGE DEBT: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Two Logan Square | $ | 84,839 |  |  | $ | 86,012 |  |  |  | 3.98% |  |  | May 2020 |
One Commerce Square |  | 124,518 |  |  |  | 127,026 |  |  |  | 3.64% |  | (a) | Apr 2023 |
Two Commerce Square |  | 112,000 |  |  |  | 112,000 |  |  |  | 4.51% |  | (b) | Apr 2023 |
Principal balance outstanding |  | 321,357 |  |  |  | 325,038 |  |  |  |  |  |  |  |
Plus: fair market value premium (discount), net |  | (2,434 | ) |  |  | (2,761 | ) |  |  |  |  |  |  |
Less: deferred financing costs |  | (606 | ) |  |  | (728 | ) |  |  |  |  |  |  |
Mortgage indebtedness | $ | 318,317 |  |  | $ | 321,549 |  |  |  |  |  |  |  |
UNSECURED DEBT |  |  |  |  |  |  |  |  |  |  |  |  |  |
$600.0M Revolving Credit Facility | $ | 178,000 |  |  | $ | - |  |  | LIBOR + 1.20% |  |  | May 2019 |
Seven-Year Term Loan - Swapped to fixed |  | 250,000 |  |  |  | 250,000 |  |  |  | 3.72% |  |  | Oct 2022 |
$300.0M 5.70% Guaranteed Notes due 2017 (c) |  | - |  |  |  | 300,000 |  |  |  | 5.68% |  |  | May 2017 |
$325.0M 4.95% Guaranteed Notes due 2018 |  | 325,000 |  |  |  | 325,000 |  |  |  | 5.13% |  |  | Apr 2018 |
$250.0M 3.95% Guaranteed Notes due 2023 |  | 250,000 |  |  |  | 250,000 |  |  |  | 4.02% |  |  | Feb 2023 |
$250.0M 4.10% Guaranteed Notes due 2024 |  | 250,000 |  |  |  | 250,000 |  |  |  | 4.33% |  |  | Oct 2024 |
$250.0M 4.55% Guaranteed Notes due 2029 |  | 250,000 |  |  |  | 250,000 |  |  |  | 4.60% |  |  | Oct 2029 |
Indenture IA (Preferred Trust I) - Swapped to fixed |  | 27,062 |  |  |  | 27,062 |  |  |  | 2.75% |  |  | Mar 2035 |
Indenture IB (Preferred Trust I) - Swapped to fixed |  | 25,774 |  |  |  | 25,774 |  |  |  | 3.30% |  |  | Apr 2035 |
Indenture II (Preferred Trust II) - Swapped to fixed |  | 25,774 |  |  |  | 25,774 |  |  |  | 3.09% |  |  | Jul 2035 |
Principal balance outstanding |  | 1,581,610 |  |  |  | 1,703,610 |  |  |  |  |  |  |  |
Plus: original issue premium (discount), net |  | (3,937 | ) |  |  | (4,678 | ) |  |  |  |  |  |  |
Less: deferred financing costs |  | (6,350 | ) |  |  | (7,369 | ) |  |  |  |  |  |  |
Total unsecured indebtedness | $ | 1,571,323 |  |  | $ | 1,691,563 |  |  |  |  |  |  |  |
Total Debt Obligations | $ | 1,889,640 |  |  | $ | 2,013,112 |  |  |  |  |  |  |  |
| (a) | This loan was assumed upon acquisition of the related properties on December 19, 2013. On December 29, 2015, the Company refinanced the debt increasing the principal balance to $130.0 million and extended the scheduled maturity date from January 6, 2016 to April 5, 2023. The effective interest rate as of December 31, 2015 was 3.64%. A default under this loan will also constitute a default under the loan secured by Two Commerce Square. This loan is also secured by a lien on Two Commerce Square.
| (b) | This loan was assumed upon acquisition of the related property on December 19, 2013. The interest rate reflects the market rate at the time of acquisition. A default under this loan will also constitute a default under the loan secured by One Commerce Square. This loan is also secured by a lien on One Commerce Square.
| (c) | On May 1, 2017, the entire principal balance of the unsecured 5.70% Guaranteed Notes was repaid upon maturity. Available cash balances and the Credit Facility (as defined below) were used to fund the repayment of the unsecured notes.
As of September 30, 2017 and December 31, 2016, the Company’s weighted-average effective interest rates on its mortgage notes payable were both 4.03%. The Company utilizes its four-year unsecured revolving credit facility (the “Credit Facility”) borrowings for general business purposes, including acquisition, development and redevelopment properties and the repayment of other debt. The Credit Facility provides for borrowings of up to $600.0 million and the per annum variable interest rate on the outstanding balances is LIBOR plus 1.20%. The interest rate and facility fee are subject to adjustment upon a change in the Company’s unsecured debt ratings. As of September 30, 2017, the Company had $178.0 million of borrowings and $13.5 million in letters of credit outstanding, leaving $408.5 million of unused availability under the Credit Facility. During the nine months ended September 30, 2017, the weighted-average interest rate on Credit Facility borrowings was 2.34%. As of September 30, 2017, the effective interest rate on Credit Facility borrowings was 2.43%. As of and during the nine-month period ended September 30, 2016, the Company had no borrowings under the Credit Facility. The Parent Company unconditionally guarantees the unsecured debt obligations of the Operating Partnership (or is a co-borrower with the Operating Partnership) but does not by itself incur unsecured indebtedness. The Parent Company has no material assets other than its investment in the Operating Partnership. The Company was in compliance with all financial covenants as of September 30, 2017. Management continuously monitors the Company’s compliance with and anticipated compliance with the covenants. Certain of the covenants restrict the Company’s ability to obtain alternative sources of capital. While the Company currently believes it will remain in compliance with its covenants, in the event that the economy deteriorates in the future, the Company may not be able to remain in compliance with such covenants, in which case a default would result absent a lender waiver. As of September 30, 2017, the Company’s aggregate scheduled principal payments of debt obligations, excluding amortization of discounts and premiums, are as follows (in thousands):
2017 (three months remaining) | $ | 1,250 |
2018 |  | 331,601 |
2019 |  | 185,360 |
2020 |  | 86,978 |
2021 |  | 6,099 |
Thereafter |  | 1,291,679 |
Total principal payments |  | 1,902,967 |
Net unamortized premiums/(discounts) |  | (6,371 | )
Net deferred financing costs |  | (6,956 | )
Outstanding indebtedness | $ | 1,889,640 |

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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