Quarterly report pursuant to Section 13 or 15(d)

DEBT FINANCING

v3.22.2
DEBT FINANCING
 6 Months Ended
Jun. 30, 2022
Debt Disclosure [Abstract]  
DEBT FINANCING DEBT FINANCING
The Company's outstanding debt as of June 30, 2022 and December 31, 2021 is summarized as follows (dollars in thousands):
Interest Rate(1)
June 30, 2022 December 31, 2021
Credit Facility:
Revolving line of credit 3.04% $ 285,000  $ 490,000 
Term loan A 3.69% 125,000  125,000 
Term loan B 2.89% 250,000  250,000 
Term loan C 2.86% 225,000  225,000 
Term loan D 3.07% 175,000  175,000 
 Term loan E 2.94% 125,000  125,000 
2023 Term loan facility 2.83% 175,000  175,000 
2028 Term loan facility 4.62% 75,000  75,000 
April 2029 term loan facility 4.27% 100,000  100,000 
June 2029 term loan facility 3.34% 285,000  — 
2026 Senior Unsecured Notes 2.16% 35,000  35,000 
2029 Senior Unsecured Notes 3.98% 100,000  100,000 
August 2030 Senior Unsecured Notes 2.99% 150,000  150,000 
November 2030 Senior Unsecured Notes 2.72% 75,000  75,000 
May 2031 Senior Unsecured Notes 3.00% 90,000  90,000 
August 2031 Senior Unsecured Notes 4.08% 50,000  50,000 
November 2031 Senior Unsecured Notes 2.81% 175,000  175,000 
2032 Senior Unsecured Notes 3.09% 100,000  100,000 
May 2033 Senior Unsecured Notes 3.10% 55,000  55,000 
November 2033 Senior Unsecured Notes 2.96% 125,000  — 
2036 Senior Unsecured Notes 3.06% 75,000  75,000 
Fixed rate mortgages payable 3.82% 301,781  303,944 
Total principal 3,151,781  2,948,944 
Unamortized debt issuance costs and debt premium, net
 (9,488) (8,013)
Total debt $ 3,142,293  $ 2,940,931 
(1)Represents the effective interest rate as of June 30, 2022. Effective interest rate incorporates the stated rate plus the impact of interest rate cash flow hedges and discount and premium amortization, if applicable. For the revolving line of credit, the effective interest rate excludes fees for unused borrowings.
As of June 30, 2022, the Company's unsecured credit facility provided for total borrowings of $1.550 billion (the "credit facility") consisting of the following components: (i) a revolving line of credit (the "Revolver") which provides for a total borrowing commitment up to $650.0 million, under which the Company may borrow, repay and re-borrow amounts, (ii) a $125.0 million tranche A term loan facility (the "Term Loan A"), (iii) a $250.0 million tranche B term loan facility (the "Term Loan B"), (iv) a $225.0 million tranche C term loan facility (the "Term Loan C"), (v) a $175.0 million tranche D term loan facility (the "Term Loan D") and (vi) a $125.0 million tranche E term loan facility (the "Term Loan E"). As of June 30, 2022, the Company had an expansion option under the credit facility, which, if exercised in full, would provide for a total credit facility of $1.750 billion.
As of June 30, 2022, the Company had outstanding letters of credit totaling $5.7 million and would have had the capacity to borrow remaining Revolver commitments of $359.3 million while remaining in compliance with the credit facility's financial covenants. At June 30, 2022, the Company was in compliance with all such covenants.
June 2029 Term Loan Facility
On June 24, 2022, the Company entered into a credit agreement with a syndicated group of lenders to make available a term loan facility that matures in June 2029 in an aggregate amount of $285.0 million, the entire amount of which was drawn on June 24, 2022. The outstanding principal amount, and all accrued but unpaid interest, is due on the maturity date. The June 2029 Term Loan Facility provides for an expansion of up to $15.0 million for a total amount of up to $300.0 million.
Interest rates applicable to loans under the June 2029 Term Loan Facility are payable monthly in arrears on the first day of each month at either a base rate plus applicable margin or SOFR plus applicable margin. As of June 30, 2022, the June 2029 Term Loan Facility had a variable effective interest rate of 3.34%. The base rate is the greater of (i) prime rate, (ii) 0.50% plus the Federal Funds Effective Rate, and (iii) 1.0% plus adjusted term secured overnight financing rate ("SOFR"). The applicable margin for the June 2029 Term Loan Facility is leverage and credit rating-based and ranges from 0.55% to 1.2% for base rate loans and 1.55% to 2.2% for SOFR based loans; provided that after such time as the Company achieves an investment grade rating from at least two rating agencies, the Company may elect (but is not required to elect) that the June 2029 Term Loan Facility subject to rating-based margins ranging from 0.075% to 1.2% for base rate loans and 1.075% to 2.2% for SOFR based loans.
The Company is required to comply with the same financial covenants under the June 2029 Term Loan Facility as it does with the credit facility, the April 2029 Term Loan Facility, the 2023 Term Loan Facility and the 2028 Term Loan Facility. In addition, the terms of the June 2029 Term Loan Facility contain customary affirmative and negative covenants that are consistent with those contained in the credit facility, the April 2029 Term Loan Facility, the 2023 Term Loan Facility and the 2028 Term Loan Facility, and, among other things, limit the Company's ability to make distributions, make certain investments, incur debt, incur liens and enter into certain transactions.
November 2030, November 2031, November 2033 and 2036 Senior Unsecured Notes
On November 9, 2021, the operating partnership as issuer, and the Company, entered into a Note Purchase Agreement (the "November 2021 Note Purchase Agreement") which provides for the private placement of $75.0 million of 2.72% senior unsecured notes due November 30, 2030 (the "November 2030 Notes"), $175.0 million of 2.81% senior unsecured notes due November 30, 2031 (the "November 2031 Notes"), $125.0 million of 2.96% senior unsecured notes due November 30, 2033 (the "November 2033 Notes") and $75.0 million of 3.06% senior unsecured notes due November 30, 2036 (the "2036 Notes" and together with the November 2030 Notes, November 2031 Notes, and November 2033 Notes, the "November 2021 Senior Unsecured Notes") to certain institutional investors. The November 2021 Senior Unsecured Notes are governed by the November 2021 Note Purchase Agreement. On December 14, 2021 the operating partnership issued the November 2030 Notes, November 2031 Notes and the 2036 Notes. On January 28, 2022 the operating partnership issued the November 2033 Notes.
Future Debt Obligations
Based on existing debt agreements in effect as of June 30, 2022, the scheduled principal and maturity payments for the Company's outstanding borrowings are presented in the table below (in thousands):
Year Ending December 31, Scheduled Principal and Maturity Payments Amortization of Premium and Unamortized Debt Issuance Costs Total
Remainder of 2022 $ 2,211  $ (1,288) $ 923 
2023 376,813  (2,213) 374,600 
2024 556,964  (1,828) 555,136 
2025 512,185  (1,253) 510,932 
2026 212,322  (1,090) 211,232 
2027 212,369  (759) 211,610 
Thereafter 1,278,917  (1,057) 1,277,860 
$ 3,151,781  $ (9,488) $ 3,142,293