Notes Payable

6 Months Ended

Jun. 30, 2020

6.Notes Payable

Our notes payable are reflected net of issuance costs, which are amortized as interest expense on the effective interest method over the term of each respective note. Our notes payable at June 30, 2020 and December 31, 2019 are set forth in the tables below:

‎


			Amounts at June 30, 2020
	Coupon	Effective			Unamortized			Book		Fair
	Rate	Rate		Principal	Costs			Value		Value
			($ amounts in thousands)
U.S. Dollar Denominated Unsecured Debt
Notes due September 15, 2022	2.370%	2.483%	$	500,000	$	(1,155)	$	498,845	$	518,935
Notes due September 15, 2027	3.094%	3.218%		500,000		(3,812)		496,188		561,525
Notes due May 1, 2029	3.385%	3.459%		500,000		(2,722)		497,278		581,763
				1,500,000		(7,689)		1,492,311		1,662,223

Euro Denominated Unsecured Debt
Notes due April 12, 2024	1.540%	1.540%		112,290		-		112,290		117,307
Notes due November 3, 2025	2.175%	2.175%		271,756		-		271,756		294,970
Notes due January 24, 2032	0.875%	0.978%		561,448		(6,199)		555,249		551,792
				945,494		(6,199)		939,295		964,069

Mortgage Debt, secured by 27
real estate facilities with a net
book value of $104.0 million	3.995%	3.972%		26,265		-		26,265		27,137

			$	2,471,759	$	(13,888)	$	2,457,871	$	2,653,429


	Amounts at
	December 31, 2019
		Book		Fair
		Value		Value
	($ amounts in thousands)
U.S. Dollar Denominated Unsecured Debt
Notes due September 15, 2022	$	498,581	$	505,639
Notes due September 15, 2027		495,924		520,694
Notes due May 1, 2029		497,124		531,911
		1,491,629		1,558,244

Euro Denominated Unsecured Debt
Notes due April 12, 2024		112,156		115,932
Notes due November 3, 2025		271,433		298,398
Notes due January 24, 2032		-		-
		383,589		414,330

Mortgage Debt		27,275		28,506

	$	1,902,493	$	2,001,080

U.S. Dollar Denominated Unsecured Notes

On September 18, 2017, we issued, in a public offering, two tranches each totaling $500.0 million of U.S. Dollar denominated unsecured notes. In connection with the offering, we incurred a total of $7.9 million in costs. Interest on such notes is payable semi-annually on March 15 and September 15 of each year.

On April 12, 2019, we completed a public offering of $500 million in aggregate principal amount of senior notes. In connection with the offering, we incurred a total of $3.1 million in costs. Interest on such notes is payable semi-annually on May 1 and November 1 of each year.

The notes issued on April 12, 2019 and on September 18, 2017 are referred to hereinafter as the “U.S. Dollar Notes.”

The U.S. Dollar Notes have various financial covenants, all of which we were in compliance with at June 30, 2020. Included in these covenants are (a) a maximum Debt to Total Assets of 65% (approximately 8% at June 30, 2020) and (b) a minimum ratio of Adjusted EBITDA to Interest Expense of 1.5x (approximately 40x for the twelve months ended June 30, 2020) as well as covenants limiting the amount we can encumber our properties with mortgage debt.

Euro Denominated Unsecured Notes

Our Euro denominated unsecured notes (the “Euro Notes”) consist of three tranches: (i) €242.0 million issued to institutional investors on November 3, 2015 for $264.3 million in net proceeds upon converting the Euros to U.S. Dollars, (ii) €100.0 million issued to institutional investors on April 12, 2016 for $113.6 million in net proceeds upon converting the Euros to U.S. Dollars, and (iii) €500.0 million issued in a public offering on January 24, 2020 for $545.2 million in net proceeds upon converting the Euros to U.S. Dollars. Interest is payable semi-annually on the notes issued November 3, 2015 and April 12, 2016, and annually on the notes issued January 24, 2020. The Euro Notes have financial covenants similar to those of the U.S. Dollar Notes.

We reflect changes in the U.S. Dollar equivalent of the amount payable, as a result of changes in foreign exchange rates as “foreign currency exchange (loss) gain” on our income statement (losses of $19.3 million and $10.4 million for the three and six months ended June 30, 2020, respectively, as compared to losses of $5.2 million and gains of $2.6 million for the three and six months ended June 30, 2019, respectively).

Mortgage Notes

Our non-recourse mortgage debt was assumed in connection with property acquisitions, and recorded at fair value with any premium or discount to the stated note balance amortized using the effective interest method.

At June 30, 2020, the related contractual interest rates are fixed, ranging between 3.2% and 7.1%, and mature between January 1, 2022 and July 1, 2030.

At June 30, 2020 approximate principal maturities of our Notes Payable are as follows (amounts in thousands):

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	Unsecured		Mortgage
	Debt		Debt		Total


Remainder of 2020	$	-	$	1,019	$	1,019
2021		-		1,858		1,858
2022		500,000		2,584		502,584
2023		-		19,219		19,219
2024		112,290		124		112,414
Thereafter		1,833,204		1,461		1,834,665
	$	2,445,494	$	26,265	$	2,471,759
Weighted average effective rate		2.4%		4.0%		2.4%

Cash paid for interest totaled $26.4 million and $21.8 million for the six months ended June 30, 2020 and 2019, respectively. Interest capitalized as real estate totaled $1.7 million and $2.0 million for the six months ended June 30, 2020 and 2019, respectively.