In the normal course of our ongoing business operations, we encounter economic risk. There are four main components of economic risk that impact us: interest rate risk, credit risk, market risk, and foreign currency risk. We are primarily subject to interest rate risk on our interest-bearing liabilities, including our Senior Unsecured Credit Facility (Note 11) and unhedged variable-rate non-recourse mortgage loans. Credit risk is the risk of default on our operations and our tenants’ inability or unwillingness to make contractually required payments. Market risk includes changes in the value of our properties and related loans, Senior Unsecured Notes, other securities, and the limited partnership units we hold in CESH, due to changes in interest rates or other market factors. We own investments in North America, Europe, and Japan and are subject to risks associated with fluctuating foreign currency exchange rates.

There have been no significant changes in our derivative financial instrument policies from what was disclosed in the 2022 Annual Report. At both September 30, 2023 and December 31, 2022, no cash collateral had been posted nor received for any of our derivative positions.


Derivatives Designated as Hedging Instruments	Balance Sheet Location	Derivative Assets Fair Value at				Derivative Liabilities Fair Value at
		September 30, 2023		December 31, 2022		September 30, 2023		December 31, 2022
Foreign currency collars	Other assets, net	$	27,088	$	32,631	$	—	$	—
Interest rate swaps	Other assets, net	3,288		2,679		—		—
Interest rate cap	Other assets, net	—		14		—		—
Foreign currency collars	Accounts payable, accrued expenses and other liabilities	—		—		(612)		(1,445)
		30,376		35,324		(612)		(1,445)
Derivatives Not Designated as Hedging Instruments
Stock warrants	Other assets, net	3,950		3,950		—		—
Foreign currency collars	Other assets, net	160		—		—		—
Foreign currency collars	Accounts payable, accrued expenses and other liabilities	—		—		—		(248)
		4,110		3,950		—		(248)
Total derivatives		$	34,486	$	39,274	$	(612)	$	(1,693)


	Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive Income (Loss) (a)
	Three Months Ended September 30,				Nine Months Ended September 30,
Derivatives in Cash Flow Hedging Relationships	2023		2022		2023		2022
Foreign currency collars	$	7,928	$	20,756	$	(4,710)	$	44,410
Interest rate swaps	(514)		1,663		683		3,019
Interest rate cap	(3)		11		(9)		16
Total	$	7,411	$	22,430	$	(4,036)	$	47,445


		Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive Income (Loss)
Derivatives in Cash Flow Hedging Relationships	Location of Gain (Loss) Recognized in Income	Three Months Ended September 30,				Nine Months Ended September 30,
		2023		2022		2023		2022
Foreign currency collars	Non-operating income	$	2,787	$	4,987	$	10,656	$	10,450
Interest rate swaps and cap	Interest expense	659		(66)		1,132		(352)
Total		$	3,446	$	4,921	$	11,788	$	10,098

(a)Excludes net losses of $0.6 million and net gains of $1.2 million recognized on unconsolidated jointly owned investments for the three months ended September 30, 2023 and 2022, respectively, and net losses of $1.3 million and net gains of $3.5 million for the nine months ended September 30, 2023 and 2022, respectively.

Amounts reported in Other comprehensive (loss) income related to interest rate derivative contracts will be reclassified to Interest expense as interest is incurred on our variable-rate debt. Amounts reported in Other comprehensive (loss) income related to foreign currency derivative contracts will be reclassified to Non-operating income when the hedged foreign currency contracts are settled. As of September 30, 2023, we estimate that an additional $2.9 million and $13.9 million will be reclassified as Interest expense and Non-operating income, respectively, during the next 12 months.


		Amount of Gain (Loss) on Derivatives Recognized in Income
Derivatives in Cash Flow Hedging Relationships	Location of Gain (Loss) Recognized in Income	Three Months Ended September 30,				Nine Months Ended September 30,
		2023		2022		2023		2022
Foreign currency collars	Non-operating income	$	951	$	3,737	$	935	$	7,520
Interest rate swaps	Interest expense	(683)		56		(1,220)		387
Derivatives Not in Cash Flow Hedging Relationships
Foreign currency collars	Other gains and (losses)	450		447		409		1,573
Total		$	718	$	4,240	$	124	$	9,480

We are exposed to the impact of interest rate changes primarily through our borrowing activities. To limit this exposure, we generally seek long-term debt financing on a fixed-rate basis. However, from time to time, we have obtained, and may in the future obtain, variable-rate (i) non-recourse mortgage loans and (ii) unsecured term loans (Note 11) and, as a result, we have entered into, and may continue to enter into, interest rate swap agreements or interest rate cap agreements with counterparties. Interest rate swaps, which effectively convert the variable-rate debt service obligations of a loan to a fixed rate, are agreements in which one party exchanges a stream of interest payments for a counterparty’s stream of cash flow over a specific period. The notional, or face, amount on which the swaps are based is not exchanged. Interest rate caps limit the effective borrowing rate of variable-rate debt obligations while allowing participants to share in downward shifts in interest rates. Our objective in using these derivatives is to limit our exposure to interest rate movements.


Interest Rate Derivatives	Number of Instruments	Notional Amount		Fair Value at September 30, 2023 (a)
Designated as Cash Flow Hedging Instruments
Interest rate swaps	4	513,214	EUR	$	2,147
Interest rate swaps	4	31,249	USD	1,141
				$	3,288

We are exposed to foreign currency exchange rate movements, primarily in the euro and, to a lesser extent, the British pound sterling and certain other currencies. In order to hedge certain of our foreign currency cash flow exposures, we enter into foreign currency collars. A foreign currency collar consists of a written call option and a purchased put option to sell the foreign currency at a range of predetermined exchange rates. A foreign currency collar guarantees that the exchange rate of the currency will not fluctuate beyond the range of the options’ strike prices. Our foreign currency collars have maturities of 59 months or less.


Foreign Currency Derivatives	Number of Instruments	Notional Amount		Fair Value at September 30, 2023
Designated as Cash Flow Hedging Instruments
Foreign currency collars	63	280,000	EUR	$	22,936
Foreign currency collars	48	30,740	GBP	3,540
Not Designated as Cash Flow Hedging Instruments
Foreign currency collar	1	8,000	EUR	160
				$	26,636

We measure our credit exposure on a counterparty basis as the net positive aggregate estimated fair value of our derivatives, net of any collateral received. No collateral was received as of September 30, 2023. At September 30, 2023, our total credit exposure and the maximum exposure to any single counterparty was $30.1 million and $4.9 million, respectively.

Some of the agreements we have with our derivative counterparties contain cross-default provisions that could trigger a declaration of default on our derivative obligations if we default, or are capable of being declared in default, on certain of our indebtedness. At September 30, 2023, we had not been declared in default on any of our derivative obligations. The estimated fair value of our derivatives in a net liability position was $0.6 million and $1.7 million at September 30, 2023 and December 31, 2022, respectively, which included accrued interest and any nonperformance risk adjustments. If we had breached any of these provisions at September 30, 2023 or December 31, 2022, we could have been required to settle our obligations under these agreements at their aggregate termination value of $0.6 million and $1.7 million, respectively.

Certain borrowings under our Senior Unsecured Notes, Unsecured Revolving Credit Facility, and Unsecured Term Loans (all as defined in Note 11) denominated in euro, British pounds sterling, or Japanese yen are designated as, and are effective as, economic hedges of our net investments in foreign entities.

Exchange rate variations impact our financial results because the financial results of our foreign subsidiaries are translated to U.S. dollars each period, with the effect of exchange rate variations being recorded in Other comprehensive (loss) income as part of the cumulative foreign currency translation adjustment. As a result, changes in the value of our borrowings under our euro-denominated senior notes and changes in the value of our euro, Japanese yen, and British pound sterling borrowings under our Senior Unsecured Credit Facility, related to changes in the spot rates, will be reported in the same manner as foreign currency translation adjustments, which are recorded in Other comprehensive (loss) income as part of the cumulative foreign currency translation adjustment. Such gains (losses) related to non-derivative net investment hedges were $108.0 million and $215.0 million for the three months ended September 30, 2023 and 2022, respectively, and $38.6 million and $528.4 million for the nine months ended September 30, 2023 and 2022, respectively.