Secured and unsecured senior debt

The following table summarizes our secured and unsecured senior debts and their respective principal maturities, as of June 30, 2013 (dollars in thousands):



	Fixed Rate/Hedged Variable Rate			Unhedged Variable Rate			Total Consolidated			Percentage of Total		Weighted Average Interest Rate at End of Period ⁽¹⁾		Weighted Average Remaining Term (including extension options, in years)
Secured notes payable	$	591,623		$	119,406		$	711,029		24.0	%	5.48	%	2.7
Unsecured senior notes payable	1,048,395			—			1,048,395			35.4		4.29		9.3
$1.5 billion unsecured senior line of credit	—			—			—			—		1.39		3.8
2016 Unsecured Senior Bank Term Loan	400,000			200,000			600,000			20.3		2.24		3.0
2017 Unsecured Senior Bank Term Loan	600,000			—			600,000			20.3		3.93		3.6
Total / weighted average	$	2,640,018		$	319,406		$	2,959,424		100.0	%	4.09	%	5.3
Percentage of total debt	89		%	11		%	100		%


(1)	Represents the weighted average contractual interest rate as of the end of the period plus the impact of debt premiums/discounts and our interest rate swap agreements. The weighted average interest rate excludes bank fees and amortization of loan fees.

The following table summarizes our outstanding consolidated indebtedness, as of June 30, 2013 (dollars in thousands):



	Stated Interest Rate			Weighted Average Interest Rate ⁽¹⁾		Maturity Date ⁽²⁾		Remaining for the Period Ending December 31,
Debt	Stated Interest Rate			Weighted Average Interest Rate ⁽¹⁾		Maturity Date ⁽²⁾		2013			2014			2015			2016			2017			Thereafter			Total
Secured notes payable
Greater Boston	5.26	%		5.59	%	4/1/14		$	1,945		$	208,683		$	—		$	—		$	—		$	—		$	210,628
Suburban Washington, D.C.	2.18			2.18		4/20/14	⁽³⁾	—			76,000			—			—			—			—			76,000
San Diego	6.05			4.88		7/1/14		59			6,458			—			—			—			—			6,517
San Diego	5.39			4.00		11/1/14		74			7,495			—			—			—			—			7,569
Seattle	6.00			6.00		11/18/14		120			240			—			—			—			—			360
Suburban Washington, D.C.	5.64			4.50		6/1/15		54			138			5,788			—			—			—			5,980
Greater Boston, San Francisco Bay Area, and San Diego	5.73			5.73		1/1/16		814			1,713			1,816			75,501			—			—			79,844
Greater Boston, San Diego, and Greater NYC	5.82			5.82		4/1/16		438			931			988			29,389			—			—			31,746
San Francisco Bay Area	6.35			6.35		8/1/16		1,149			2,487			2,652			126,715			—			—			133,003
San Francisco Bay Area	LIBOR+1.50			1.70		7/1/17	⁽⁴⁾	—			—			43,046			—			—			—			43,046
San Diego, Suburban Washington, D.C., and Seattle	7.75			7.75		4/1/20		685			1,453			1,570			1,696			1,832			108,469			115,705
San Francisco Bay Area	6.50			6.50		6/1/37		—			17			18			19			20			773			847
Average/Total	5.42	%		5.48				5,338			305,615			55,878			233,320			1,852			109,242			711,245
Unsecured debt
$1.5 billion unsecured senior line of credit ⁽⁵⁾	LIBOR+ 1.20%		⁽⁶⁾	1.39		4/30/17		—			—			—			—			—			—			—
2016 Unsecured Senior Bank Term Loan ⁽⁵⁾	LIBOR+ 1.75%			2.24		6/30/16	⁽³⁾	—			—			—			600,000			—			—			600,000
2017 Unsecured Senior Bank Term Loan ⁽⁵⁾	LIBOR+ 1.50%			3.93		1/31/17	⁽³⁾	—			—			—			—			600,000			—			600,000
Unsecured senior notes payable	4.60	%		4.61		4/1/22		—			250			—			—			—			550,000			550,250
Unsecured senior notes payable	3.90	%		3.94		6/15/23		—			—			—			—			—			500,000			500,000
Average/Subtotal				4.09				5,338			305,865			55,878			833,320			601,852			1,159,242			2,961,495
Unamortized discounts				—				(294		)	(200		)	(139		)	(177		)	(184		)	(1,077		)	(2,071		)
Average/Total				4.09	%			$	5,044		$	305,665		$	55,739		$	833,143		$	601,668		$	1,158,165		$	2,959,424

Balloon payments								$	—		$	297,330		$	48,774		$	830,029		$	600,000		$	654,352		$	2,430,485
Principal amortization								5,044			8,335			6,965			3,114			1,668			503,813			528,939
Total consolidated debt								$	5,044		$	305,665		$	55,739		$	833,143		$	601,668		$	1,158,165		$	2,959,424

Fixed rate/hedged variable rate debt								$	4,924		$	229,425		$	12,693		$	633,143		$	601,668		$	1,158,165		$	2,640,018
Unhedged variable rate debt								120			76,240			43,046			200,000			—			—			319,406
Total consolidated debt								$	5,044		$	305,665		$	55,739		$	833,143		$	601,668		$	1,158,165		$	2,959,424


(1)	Represents the weighted average contractual interest rate as of the end of the period plus the impact of debt premiums/discounts and our interest rate swap agreements. The weighted average interest rate excludes bank fees and amortization of loan fees.


(2)	Includes any extension options that we control.


(3)	This loan may be prepaid without any prepayment penalty.


(4)	We have two, one year options to extend the stated maturity date of July 1, 2015.


(5)	Does not reflect amendments completed or in progress subsequent to June 30, 2013, that will reduce our borrowing costs and/or extend our maturity as noted in our Subsequent Events note to the consolidated financial statements. See Note 13 for amended terms.


(6)	In addition to the stated rate, we were subject to an annual facility fee of 0.25% as of June 30, 2013.

3.90% Unsecured senior notes payable

In June 2013, we completed a $500 million public offering of our unsecured senior notes payable at a stated interest rate of 3.90% (“3.90% Unsecured Senior Notes”). The unsecured senior notes payable were priced at 99.712% of the principal amount with a yield to maturity of 3.94% and are due June 15, 2023. The unsecured senior notes payable are unsecured obligations of the Company and are fully and unconditionally guaranteed by Alexandria Real Estate Equities, L.P., a 100% owned subsidiary of the Company. The unsecured senior notes payable rank equally in right of payment with all other senior unsecured indebtedness. However, the unsecured senior notes payable are effectively subordinated to existing and future mortgages and other secured indebtedness (to the extent of the value of the collateral securing such indebtedness) and to all existing and future preferred equity and liabilities, whether secured or unsecured, of the Company’s subsidiaries, other than Alexandria Real Estate Equities, L.P. We used the net proceeds of this offering to prepay $150 million of the outstanding principal balance of $750 million on our unsecured senior bank term loan due in 2016 (“2016 Unsecured Senior Bank Term Loan”), to reduce the outstanding borrowings on our unsecured senior line of credit to zero, and to hold the remaining proceeds in cash and cash equivalents to fund near-term opportunities related to development/redevelopment projects, to fund near-term property acquisitions, and for general corporate purposes. As a result of the $150 million prepayment, we recognized a loss on early extinguishment of debt related to the write-off of a portion of unamortized loan fees in June 2013, totaling $560 thousand.

Unsecured senior line of credit and unsecured senior bank term loans

The maturity date of the unsecured senior line of credit is April 2017, assuming we exercise our sole right to extend the maturity date twice by an additional six months after each exercise. Borrowings under the unsecured senior line of credit will bear interest at LIBOR or the base rate specified in the amended unsecured senior line of credit agreement, plus in either case a specified margin (the “Applicable Margin”). The Applicable Margin for LIBOR borrowings under the unsecured senior line of credit as of June 30, 2013, was 1.20%, which is based on our existing credit rating as set by certain rating agencies. As of June 30, 2013, we did not have any borrowings outstanding. Our unsecured senior line of credit is subject to an annual facility fee of 0.25% based on the aggregate commitments outstanding.

In addition, the terms of the unsecured senior line of credit and unsecured senior bank term loan agreements, among other things, limit the ability of the Company, Alexandria Real Estate Equities, L.P., and the Company’s subsidiaries to i) consummate a merger, or consolidate or sell all or substantially all of the Company’s assets, and ii) incur certain secured or unsecured indebtedness. Additionally, the terms of the unsecured senior line of credit and unsecured senior bank term loan agreements include a restriction that may limit our ability to pay dividends, including distributions with respect to common stock or other equity interests, during any time a default is continuing, except to enable us to continue to qualify as a REIT for federal income tax purposes. As of June 30, 2013, we were in compliance with all such covenants.

The following table outlines our interest expense for the three and six months ended June 30, 2013 and 2012 (in thousands):



	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Gross interest	$	31,668		$	33,747		$	63,709		$	65,239
Capitalized interest	(15,690		)	(15,825		)	(29,711		)	(31,091		)
Interest expense	$	15,978		$	17,922		$	33,998		$	34,148