Secured and unsecured senior debt (Tables)

12 Months Ended

Dec. 31, 2013

The following table summarizes our secured and unsecured senior debts as of December 31, 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 (in years)
Secured notes payable	$	586,578		$	122,253		$	708,831		23.2	%	5.45	%	2.2
4.60% unsecured senior notes payable	549,603			—			549,603			17.9		4.61		8.3
3.90% unsecured senior notes payable	498,627			—			498,627			16.3		3.94		9.5
$1.5 billion unsecured senior line of credit	—			204,000			204,000			6.7		1.27		5.0
2016 Unsecured Senior Bank Term Loan	350,000			150,000			500,000			16.3		2.37		2.6
2019 Unsecured Senior Bank Term Loan	600,000			—			600,000			19.6		2.85		5.0
Total / weighted average	$	2,584,808		$	476,253		$	3,061,061		100.0	%	3.76	%	5.3
Percentage of total debt	84		%	16		%	100		%


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

Summary of fixed rate/hedged and unhedged floating rate debt and their respective principal maturities

The following table summarizes our outstanding consolidated indebtedness and respective principal maturities as of December 31, 2013 (dollars in thousands):



	Stated Rate			Weighted Average Interest Rate⁽¹⁾		Maturity Date⁽²⁾		Principal Payments for the Period Ending December 31,
Debt	Stated Rate			Weighted Average Interest Rate⁽¹⁾		Maturity Date⁽²⁾		2014				2015			2016			2017			2018			Thereafter			Total
Secured notes payable
Greater Boston	5.26	%		5.59	%	04/01/14		$	208,683		⁽³⁾	$	—		$	—		$	—		$	—		$	—		$	208,683
San Diego	6.05			4.88		07/01/14		6,446				—			—			—			—			—			6,446
San Diego	5.39			4.00		11/01/14		7,480				—			—			—			—			—			7,480
Seattle	6.00			6.00		11/18/14		240				—			—			—			—			—			240
Maryland	5.64			4.50		06/01/15		127				5,788			—			—			—			—			5,915
San Francisco Bay Area	L+1.50			1.67		07/01/15	⁽⁴⁾	—				46,013			—			—			—			—			46,013
Greater Boston, San Francisco Bay Area, and San Diego	5.73			5.73		01/01/16		1,713				1,816			75,501			—			—			—			79,030
Greater Boston, San Diego, and Greater New York City	5.82			5.82		04/01/16		931				988			29,389			—			—			—			31,308
San Francisco Bay Area	L+1.40			1.57		06/01/16	⁽⁵⁾	—				—			—			—			—			—			—
San Francisco Bay Area	6.35			6.35		08/01/16		2,487				2,652			126,715			—			—			—			131,854
Maryland	2.16			2.16		01/20/17		—				—			—			76,000			—			—			76,000
Greater Boston	L+1.35			1.52		08/23/17	⁽⁶⁾	—				—			—			—			—			—			—
San Diego, Maryland, and Seattle	7.75			7.75		04/01/20		1,453				1,570			1,696			1,832			1,979			106,491			115,021
San Francisco Bay Area	6.50			6.50		06/01/37		17				18			19			20			22			751			847
Average/Total	5.39	%		5.45				229,577				58,845			233,320			77,852			2,001			107,242			708,837

2016 Unsecured Senior Bank Term Loan	L+1.20	%		2.37		07/31/16		—				—			500,000			—			—			—			500,000
2019 Unsecured Senior Bank Term Loan	L+1.20	%		2.85		01/03/19		—				—			—			—			—			600,000			600,000
$1.5 billion unsecured senior line of credit	L+1.10	%	⁽⁷⁾	1.27		01/03/19		—				—			—			—			—			204,000			204,000
Unsecured senior notes payable	4.60	%		4.61		04/01/22		—				—			—			—			—			550,000			550,000
Unsecured senior notes payable	3.90	%		3.94		06/15/23		—				—			—			—			—			500,000			500,000
Average/Subtotal				3.76				229,577				58,845			733,320			77,852			2,001			1,961,242			3,062,837
Unamortized discounts				—				(199		)		(139		)	(177		)	(184		)	(192		)	(885		)	(1,776		)
Average/Total				3.76	%			$	229,378			$	58,706		$	733,143		$	77,668		$	1,809		$	1,960,357		$	3,061,061

Balloon payments								$	221,080			$	51,741		$	730,029		$	76,000		$	—		$	1,958,352		$	3,037,202
Principal amortization								8,298				6,965			3,114			1,668			1,809			2,005			23,859
Total consolidated debt								$	229,378			$	58,706		$	733,143		$	77,668		$	1,809		$	1,960,357		$	3,061,061

Fixed-rate/hedged variable-rate debt								$	229,138			$	12,693		$	583,143		$	1,668		$	1,809		$	1,756,357		$	2,584,808
Unhedged variable-rate debt								240				46,013			150,000			76,000			—			204,000			476,253
Total consolidated debt								$	229,378			$	58,706		$	733,143		$	77,668		$	1,809		$	1,960,357		$	3,061,061


(1)	Represents the weighted average contractual interest rate as of the end of the period plus the impact of debt premiums/discounts and 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)	Secured note payable related to Alexandria Technology Square^® was repaid on January 31, 2014. Our partner has a 10% interest in this project and provided $20.9 million for the repayment.


(4)	Secured construction loan with aggregate commitments of $55.0 million. We have two, one-year options to extend the stated maturity date to July 1, 2017, subject to certain conditions.


(5)	Secured construction loan with aggregate commitments of $36.0 million. We have two, one-year options to extend the stated maturity date to June 1, 2018, subject to certain conditions. In February 2014, $2.2 million was drawn on this loan.


(6)	Secured construction loan with aggregate commitments of $250.4 million. We have a one-year option to extend the stated maturity date to August 23, 2018, subject to certain conditions. We expect to begin drawing on this loan in the first quarter of 2014.


(7)	In addition to the stated rate, the line of credit is subject to an annual facility fee of 0.20%.

Schedule of changes to long-term debt

The maturity dates below reflect any available extension options that we control.

Balance at 12/31/13

Maturity Date

Applicable Rate

Facility Fee

Facility

Prior

Amended

Prior

Amended

Prior

Amended

2016 Unsecured Senior Bank Term Loan

500

million

June 2016

July 2016

L+1.75%

L+1.20%

N/A

2019 Unsecured Senior Bank Term Loan

600

million

January 2017

January 2019

L+1.50%

L+1.20%

N/A

$1.5 billion unsecured senior line of credit

204

million

April 2017

January 2019

L+1.20%

L+1.10%

0.25

0.20

Summary of financial covenants under unsecured senior line of credit and unsecured senior bank term loans

The requirements of the key financial covenants under our unsecured senior notes payable as of December 31, 2013, are as follows:



Covenant Ratios ⁽¹⁾		Requirement
Total Debt to Total Assets		Less than or equal to 60%
Consolidated EBITDA to Interest Expense		Greater than or equal to 1.5x
Unencumbered Total Asset Value to Unsecured Debt		Greater than or equal to 150%
Secured Debt to Total Assets		Less than or equal to 40%


(1)	For a definition of the ratios used in the table above, refer to the Indenture dated June 7, 2013, which governs the unsecured senior notes payable, which was filed as an exhibit to the Form 8-K filed with the SEC on June 7, 2013

The requirements of the key financial covenants under our unsecured senior line of credit and unsecured senior bank term loans as of December 31, 2013, are as follows:



Covenant Ratios ⁽¹⁾		Requirement
Leverage Ratio		Less than or equal to 60.0%
Fixed Charge Coverage Ratio		Greater than or equal to 1.50x
Secured Debt Ratio		Less than or equal to 45.0%
Unsecured Leverage Ratio		Less than or equal to 60.0%
Unsecured Interest Coverage Ratio		Greater than or equal to 1.50x


(1)	For a definition of the ratios, refer to the amended unsecured senior line of credit and unsecured senior bank term loan agreements, each dated as of August 30, 2013 and July 26, 2013, which are filed as exhibits to our Quarterly Report on Form 10-Q filed with the SEC on November 7, 2013.

Schedule of interest expense incurred

The following table summarizes interest expense for the years ended December 31, 2013, 2012, and 2011 (in thousands):



	Year Ended December 31,
	2013			2012			2011
Gross interest	$	128,567		$	131,935		$	124,429
Capitalized interest	(60,615		)	(62,751		)	(61,056		)
Interest expense ⁽¹⁾	$	67,952		$	69,184		$	63,373

(1) Includes interest expense related to and classified in income from discontinued operations in the accompanying consolidated statements of income.