Mortgages and Other Loans Payable

12 Months Ended

Dec. 31, 2018

The first mortgages and other loans payable collateralized by the respective properties and assignment of leases or debt investments at December 31, 2018 and 2017, respectively, were as follows (amounts in thousands):



Property	Maturity Date	Interest Rate ⁽¹⁾		December 31, 2018			December 31, 2017
Fixed Rate Debt:
762 Madison Avenue	February 2022		5.00%	771			771
100 Church Street	July 2022		4.68%	213,208			217,273
420 Lexington Avenue	October 2024		3.99%	300,000			300,000
400 East 58th Street ⁽²⁾	November 2026		3.00%	39,931			40,000
Landmark Square	January 2027		4.90%	100,000			100,000
485 Lexington Avenue	February 2027		4.25%	450,000			450,000
1080 Amsterdam ⁽³⁾	February 2027		3.58%	35,807			36,363
315 West 33rd Street	February 2027		4.17%	250,000			250,000
919 Third Avenue ⁽⁴⁾				—			500,000
Unsecured Loan ⁽⁵⁾				—			16,000
Series J Preferred Units ⁽⁶⁾				—			4,000
One Madison Avenue ⁽⁷⁾				—			486,153
Total fixed rate debt				$	1,389,717		$	2,400,560
Floating Rate Debt:
FHLB Facility	May 2019	L+	0.27%	$	13,000		$	—
2017 Master Repurchase Agreement	June 2019	L+	2.34%	300,000			90,809
FHLB Facility	December 2019	L+	0.18%	14,500			—
133 Greene Street	August 2020	L+	2.00%	15,523			—
185 Broadway ⁽⁸⁾	November 2021	L+	2.85%	111,869			58,000
712 Madison	December 2021	L+	2.50%	28,000			—
115 Spring Street	September 2023	L+	3.40%	65,550			—
719 Seventh Avenue	September 2023	L+	1.20%	50,000			41,622
220 East 42nd Street ⁽⁹⁾				—			275,000
Total floating rate debt				$	598,442		$	465,431
Total fixed rate and floating rate debt				$	1,988,159		$	2,865,991
Mortgages reclassed to liabilities related to assets held for sale				—			—
Total mortgages and other loans payable				$	1,988,159		$	2,865,991
Deferred financing costs, net of amortization				(26,919		)	(28,709		)
Total mortgages and other loans payable, net				$	1,961,240		$	2,837,282


(1)	Interest rate as of December 31, 2018, taking into account interest rate hedges in effect during the period. Floating rate debt is presented with the stated interest rate spread over 30-day LIBOR, unless otherwise specified.


(2)	The loan carries a fixed interest rate of 300 basis points for the first five years and is prepayable without penalty at the end of year five.


(3)	The loan is comprised of a $35.5 million mortgage loan and $0.9 million subordinate loan with a fixed interest rate of 350 basis points and 700 basis points, respectively, for the first five years and is prepayable without penalty at the end of year five.


(4)	Our investment in the property was deconsolidated as of January 1, 2018. See Note 6, "Investments in Unconsolidated Joint Ventures".


(5)	In May 2018, the loan was repaid in connection with the sale of the property.


(6)	In June 2018, the Series J Preferred Units were redeemed in connection with the sale of the property.


(7)	In 2018, the Company recognized a $14.9 million loss on extinguishment of debt related to the early repayment of this loan.


(8)	This loan is a $225.0 million construction facility, with reductions in interest cost based on meeting certain conditions, and has an initial three-year term with two one-year extension options. Advances under the loan are subject to incurred costs and funded equity requirements.


(9)	In 2018, the mortgage was repaid.

At December 31, 2018 and 2017, the gross book value of the properties and debt and preferred equity investments collateralizing the mortgages and other loans payable, not including assets held for sale, was approximately $3.9 billion and $4.8 billion, respectively.

Federal Home Loan Bank of New York Facility

The Company’s wholly-owned subsidiary, Ticonderoga Insurance Company, or Ticonderoga, a Vermont licensed captive insurance company, is a member of the Federal Home Loan Bank of New York, or FHLBNY. As a member, Ticonderoga may borrow funds from the FHLBNY in the form of secured advances. As of December 31, 2018, we had $13.0 million and $14.5 million in outstanding secured advances with a borrowing rate of 30-day LIBOR over 27 basis points and 30-day LIBOR over 18 basis points, respectively.

Master Repurchase Agreements

The Company has entered into two Master Repurchase Agreements, or MRAs, known as the 2016 MRA and 2017 MRA, which provide us with the ability to sell certain debt investments with a simultaneous agreement to repurchase the same at a certain date or on demand. We seek to mitigate risks associated with our repurchase agreement by managing the credit quality of our assets, early repayments, interest rate volatility, liquidity, and market value. The margin call provisions under our repurchase facilities permit valuation adjustments based on capital markets activity, and are not limited to collateral-specific credit marks. To monitor credit risk associated with our debt investments, our asset management team regularly reviews our investment portfolio and is in contact with our borrowers in order to monitor the collateral and enforce our rights as necessary. The risk associated with potential margin calls is further mitigated by our ability to recollateralize the facility with additional assets from our portfolio of debt investments, our ability to satisfy margin calls with cash or cash equivalents and our access to additional liquidity through the 2017 credit facility, as defined below.

In June 2017, we entered into the 2017 MRA, with a maximum facility capacity of $300.0 million. In April 2018, we increased the maximum facility capacity to $400.0 million. The facility bears interest on a floating rate basis at a spread to 30-day LIBOR based on the pledged collateral and advance rate and has an initial one year term, with two one year extension options. In June 2018, we exercised a one year extension option. At December 31, 2018, the facility had a carrying value of $299.6 million, net of deferred financing costs.

In July 2016, we entered into a restated 2016 MRA, with a maximum facility capacity of $300.0 million. In June 2018, we terminated the restated 2016 MRA. The facility bore interest ranging from 225 and 400 basis points over 30-day LIBOR depending on the pledged collateral and had an initial two-year term, with a one year extension option. Since December 6, 2015, we had been required to pay monthly in arrears a 25 basis point fee on the excess of $150.0 million over the average daily balance during the period when the average daily balance was less than $150.0 million.

Corporate Indebtedness

2017 Credit Facility

In November 2017, we entered into an amendment to the credit facility, referred to as the 2017 credit facility, that was originally entered into by the Company in November 2012, or the 2012 credit facility. As of December 31, 2018, the 2017 credit facility consisted of a $1.5 billion revolving credit facility, a $1.3 billion term loan (or "Term Loan A"), and a $200.0 million term loan (or "Term Loan B") with maturity dates of March 31, 2022, March 31, 2023, and November 21, 2024, respectively. The revolving credit facility has two six-month as-of-right extension options to March 31, 2023. We also have an option, subject to customary conditions, to increase the capacity of the credit facility to $4.5 billion at any time prior to the maturity dates for the revolving credit facility and term loans without the consent of existing lenders, by obtaining additional commitments from our existing lenders and other financial institutions.

As of December 31, 2018, the 2017 credit facility bore interest at a spread over 30-day LIBOR ranging from (i) 82.5 basis points to 155 basis points for loans under the revolving credit facility, (ii) 90 basis points to 175 basis points for loans under Term Loan A, and (iii) 150 basis points to 245 basis points for loans under Term Loan B, in each case based on the credit rating assigned to the senior unsecured long term indebtedness of the Company.

At December 31, 2018, the applicable spread was 100 basis points for the revolving credit facility, 110 basis points for Term Loan A, and 165 basis points for Term Loan B. We are required to pay quarterly in arrears a 12.5 to 30 basis point facility fee on the total commitments under the revolving credit facility based on the credit rating assigned to the senior unsecured long term indebtedness of the Company. As of December 31, 2018, the facility fee was 20 basis points.

As of December 31, 2018, we had $11.8 million of outstanding letters of credit, $500.0 million drawn under the revolving credit facility and $1.5 billion outstanding under the term loan facilities, with total undrawn capacity of $1.0 billion under the 2017 credit facility. At December 31, 2018 and December 31, 2017, the revolving credit facility had a carrying value of $492.2 million and $30.3 million, respectively, net of deferred financing costs. At December 31, 2018 and December 31, 2017, the term loan facilities had a carrying value of $1.5 billion and $1.5 billion, respectively, net of deferred financing costs.

The Company and the Operating Partnership are borrowers jointly and severally obligated under the 2017 credit facility.

The 2017 credit facility includes certain restrictions and covenants (see Restrictive Covenants below).

Senior Unsecured Notes

The following table sets forth our senior unsecured notes and other related disclosures as of December 31, 2018 and 2017, respectively, by scheduled maturity date (amounts in thousands):



Issuance	December 31, 2018 Unpaid Principal Balance		December 31, 2018 Accreted Balance			December 31, 2017 Accreted Balance			Interest Rate (1)			Initial Term (in Years)	Maturity Date
March 16, 2010 ⁽²⁾	$	250,000	$	250,000		$	250,000			7.75	%	10	March 2020
August 7, 2018 ^{(3) (4)}	350,000		350,000			—			L+	0.98	%	3	August 2021
October 5, 2017 ⁽³⁾	500,000		499,591			499,489				3.25	%	5	October 2022
November 15, 2012 ⁽⁵⁾	300,000		304,168			305,163				4.50	%	10	December 2022
December 17, 2015 ⁽²⁾	100,000		100,000			100,000				4.27	%	10	December 2025
August 5, 2011 ^{(2) (6)}	—		—			249,953
	$	1,500,000	$	1,503,759		$	1,404,605
Deferred financing costs, net			(8,545		)	(8,666		)
	$	1,500,000	$	1,495,214		$	1,395,939


(1)	Interest rate as of December 31, 2018, taking into account interest rate hedges in effect during the period. Floating rate notes are presented with the stated spread over 3-month LIBOR, unless otherwise specified. Interest on the senior unsecured notes is payable semi-annually with principal and unpaid interest due on the scheduled maturity dates.


(2)	Issued by the Company and the Operating Partnership as co-obligors.


(3)	Issued by the Operating Partnership with the Company as the guarantor.


(4)	Beginning on August 8, 2019 and at any time thereafter, the notes are subject to redemption at the Company's option, in whole but not in part, at a redemption price equal to 100% of the principal amount of the notes, plus unpaid accrued interest thereon to the redemption date.


(5)	In October 2017, the Company and the Operating Partnership as co-obligors issued an additional $100.0 million of 4.50% senior unsecured notes due December 2022. The notes were priced at 105.334%.


(6)	The balance was repaid in August 2018.

Restrictive Covenants

The terms of the 2017 credit facility and certain of our senior unsecured notes include certain restrictions and covenants which may limit, among other things, our ability to pay dividends, make certain types of investments, incur additional indebtedness, incur liens and enter into negative pledge agreements and dispose of assets, and which require compliance with financial ratios relating to the maximum ratio of total indebtedness to total asset value, a minimum ratio of EBITDA to fixed charges, a maximum ratio of secured indebtedness to total asset value and a maximum ratio of unsecured indebtedness to unencumbered asset value. The dividend restriction referred to above provides that, we will not during any time when a default is continuing, make distributions with respect to common stock or other equity interests, except to enable the Company to continue to qualify as a REIT for Federal income tax purposes. As of December 31, 2018 and 2017, we were in compliance with all such covenants.

Junior Subordinated Deferrable Interest Debentures

In June 2005, the Company and the Operating Partnership issued $100.0 million in unsecured trust preferred securities through a newly formed trust, SL Green Capital Trust I, or the Trust, which is a wholly-owned subsidiary of the Operating Partnership. The securities mature in 2035 and bear interest at a floating rate of 125 basis points over the three-month LIBOR. Interest payments may be deferred for a period of up to eight consecutive quarters if the Operating Partnership exercises its right to defer such payments. The Trust preferred securities are redeemable at the option of the Operating Partnership, in whole or in part, with no prepayment premium. We do not consolidate the Trust even though it is a variable interest entity as we are not the primary beneficiary. Because the Trust is not consolidated, we have recorded the debt on our consolidated balance sheets and the related payments are classified as interest expense.

Principal Maturities

Combined aggregate principal maturities of mortgages and other loans payable, 2017 credit facility, trust preferred securities, senior unsecured notes and our share of joint venture debt as of December 31, 2018, including as-of-right extension options and put options, were as follows (in thousands):



	Scheduled Amortization		Principal		Revolving Credit Facility		Unsecured Term Loans		Trust Preferred Securities		Senior Unsecured Notes		Total		Joint Venture Debt
2019	$	6,241	$	27,500	$	—	$	—	$	—	$	—	$	33,741	$	115,295
2020	11,117		315,523		—		—		—		250,000		576,640		278,791
2021	11,636		139,869		—		—		—		350,000		501,505		518,371
2022	9,429		198,588		—		—		—		800,000		1,008,017		220,810
2023	7,301		115,550		500,000		1,300,000		—		—		1,922,851		277,996
Thereafter	9,290		1,136,115		—		200,000		100,000		100,000		1,545,405		2,430,198
	$	55,014	$	1,933,145	$	500,000	$	1,500,000	$	100,000	$	1,500,000	$	5,588,159	$	3,841,461

Consolidated interest expense, excluding capitalized interest, was comprised of the following (in thousands):



	Year Ended December 31,
	2018			2017			2016
Interest expense before capitalized interest	$	244,788		$	284,649		$	348,062
Interest capitalized	(34,162		)	(26,020		)	(24,067		)
Interest income	(1,957		)	(1,584		)	(2,796		)
Interest expense, net	$	208,669		$	257,045		$	321,199