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Mortgage Loans Payable And Credit Facility | 9 Months Ended
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Sep. 30, 2014
Mortgage Loans Payable And Credit Facility [Abstract] |
Mortgage Loans Payable And Credit Facility | Note 6. Mortgage Loans Payable and Credit Facility Mortgage Loans P ayable During the nine months ended September 30, 2014, the Company repaid the following mortgage loans payable:
|  | Repayment |  | Maturity |  | Principal Payoff
Property |  | Date |  | Date |  | Amount
East Little Creek (a) |  | February 3, 2014 |  | September 1, 2021 |  | $ 295,000
Upland Square |  | February 11, 2014 |  | October 26, 2014 |  | $ 57,839,000
Kings Plaza |  | April 1, 2014 |  | July 1, 2014 |  | $ 7,188,000
Coliseum Marketplace |  | April 1, 2014 |  | July 1, 2014 |  | $ 11,045,000
Liberty Marketplace (a) |  | April 1, 2014 |  | July 1, 2014 |  | $ 8,171,000
Trexler Mall |  | May 11, 2014 |  | May 11, 2014 |  | $ 19,479,000
Yorktowne Plaza |  | June 2, 2014 |  | July 1, 2014 |  | $ 18,726,000
Quartermaster Plaza |  | June 5, 2014 |  | October 1, 2014 |  | $ 11,217,000
Fieldstone Marketplace |  | July 11, 2014 |  | July 11, 2014 |  | $ 16,878,000
Mechanicsburg Center |  | August 1, 2014 |  | November 1, 2014 |  | $ 8,215,000
(a) Included in mortgage loans payable - real estate held for sale/conveyance on the accompanying balance sheet at December 31, 2013.
Unsecured Revolving C redit F acility and Term Loans The Company has a $260 million revolving credit facility, expiring on August 1, 2016. T he revolving credit facility may be extended, at the Company’s option, for two additional one-year periods, s ubject to customary conditions. Under an accordion feature, the facility can be increased to $500 million, subject to customary conditions, and lending commitments from participating banks. The facility contains financial covenants including, but not limited to, maximum debt leverage, maximum secured debt, minimum interest coverage, minimum fixed charge coverage, and minimum net worth. In addition, the facility contains restrictions including, but not limited to, limits on indebtedness, certain investments and distributions. Although the facility is unsecured, borrowing availability is based on unencumbered property adjusted net operating income, as defined in the agreement. The Company’s failure to comply with the covenants or the occurrence of an event of default under the facility could result in the acceleration of the related debt. As of September 30, 2014, the Company is in compliance with all financial covenants. As of September 30, 2014, the Company had $81.0 million outstanding under the revolving credit facility, and had $168.4 million available for additional borrowings. Borrowings under the revolving credit facility are priced at LIBOR plus 175 basis points (“bps”) (a weighted average rate of 2.0% per annum at September 30, 2014), and can range from LIBOR plus 165 bps to 225 bps based on the Company’s leverage ratio. On February 11, 2014, the Company closed $150 million of unsecured term loans consisting of a five-year $75 million term loan, maturing on February 11, 2019, and a seven-year $75 million term loan, maturing on February 11, 2021. Under an accordion feature, the term loans can be increased to an aggregate of $300 million, subject to customary conditions and lending commitments from participating banks. The financial covenants and other terms contained in the loan agreement are substantially the same as those contained in the Company’s revolving credit facility (see above). In connection with the transaction, the Company paid fees and legal expenses of approximately $1.1 million. The five-year term loan, all of which was borrowed at closing, is priced at LIBOR plus 155 bps (a rate of 1.7% per annum at September 30, 2014), and can range from LIBOR plus 145 bps to 205 bps based on the Company’s leverage ratio. The seven-year term loan, all of which was borrowed on June 24, 2014, is priced at LIBOR plus 180 bps (a rate of 2.0% per annum at September 30, 2014), and can range from LIBOR plus 170 bps to 230 bps, also based on the Company’s leverage ratio. The Company has entered into forward interest rate swap agreements which convert the LIBOR rates to fixed rates for the new term loans beginning July 1, 2014 through their maturities. As a result, based on the Company’s leverage ratio as of September 30, 2014, the effective fixed interest rates are 3.2% for the five-year term loan and 4.1% for the seven-year term loan. Derivative Financial I nstruments As discussed above, on February 11, 2014, the Company closed $150 million of unsecured term loans for which it entered into forward interest rate swap agreements, which became effective on July 1, 2014. On May 29, 2014, the Company sold Townfair Center, which collateralized an $11.8 million mortgage loan payable subject to an interest rate swap having a fair value recorded as a liability of $0.7 million. At closing, the buyer assumed both the outstanding mortgage loan payable and the related interest rate swap, and the aforementioned $0.7 million was removed from both other comprehensive loss and accounts payable and accrued liabilities. At September 30, 2014, the Company had $933,000 on the consolidated balance sheet included in a ccounts payable and accrued liabilities relating to the fair value of the interest rate swaps applicable to the $150 million unsecured term loans which closed on February 11, 2014. Charges and/or credits relating to the changes in the fair value of the interest rate swaps are made to accumulated other comprehensive income (loss), noncontrolling interests (minority interests in consolidated joint ventures and limited partners’ interest), or operations (included in interest expense), as app licable. Over time, the unrealized gains and losses recorded in accumulated other comprehensive loss will be reclassified into earnings as an increase or reduction to interest expense in the same periods in which the hedged interest payments affect earnings. The Company estimates that approximately $2.8 million of accumulated other comprehensive loss will be reclassified as a charge to earnings within the next twelve months. The following is a summary of the derivative financial instruments held by the Company at September 30, 2014 and December 31, 201 3:
|  |  |  |  | Notional values |  |  |  | Balance |  | Fair value
Designation/ |  |  |  |  | September 30, |  |  |  | December 31, |  | Maturity |  | sheet |  | September 30, |  | December 31,
Cash flow | Derivative |  | Count |  | 2014 |  | Count |  | 2013 |  | date |  | location |  | 2014 |  | 2013
Qualifying | Interest rate swaps |  | 2 |  | $ 150,000,000 |  | - |  | $ - |  | 2019/2021 |  | Accounts payable and accrued liabilities |  | $ 933,000 |  | $ -
Qualifying | Interest rate swap |  | - |  | $ - |  | 1 |  | $ 11,894,000 | (a) | - |  | Accounts payable and accrued liabilities |  | $ - |  | $ 647,000
(a) Amount is an interest rate swap related to mortgage loans payable - real estate held for sale/conveyance on the consolidated balance sheet.
The following presents the effect of the Company’s derivative financial instruments on the consolidated statements of operations and the consolidated statements of equity for the three and nine months ended September 30, 2014 and 201 3, respectively:
|  |  |  | Gain (loss) recognized in other
|  |  |  | comprehensive income (effective portion)
Designation/ |  |  |  | Three months ended September 30, |  | Nine months ended September 30,
Cash flow |  | Derivative |  | 2014 |  | 2013 |  | 2014 |  | 2013
Qualifying |  | Interest rate swaps |  | $ 324,000 |  | $ (92,000) |  | $ (1,118,000) |  | $ 174,000
|  |  |  | Gain (loss) recognized in other
|  |  |  | comprehensive income reclassified into earnings (effective portion)
|  |  |  | Three months ended September 30, |  | Nine months ended September 30,
|  | Classification |  | 2014 |  | 2013 |  | 2014 |  | 2013
|  | Continuing Operations |  | $ 757,000 |  | $ 180,000 |  | $ 908,000 |  | $ 670,000
|  | Discontinued Operations |  | $ - |  | $ 78,000 |  | $ 129,000 |  | $ 232,000
As of September 30, 2014, the Company believes it has no significant risk associated with non-performance of the financial institutions which are the counterparties to its derivative contracts.

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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 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 19, 20, 22 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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