Note 4 - Mortgage Notes Payable and Credit Facilities

3 Months Ended

Jun. 30, 2013

4.	Mortgage Notes Payable and Credit Facilities

ROIC does not hold any indebtedness. All debt is held directly or indirectly by the Operating Partnership; however, ROIC has guaranteed the Operating Partnership’s revolving credit facility, term loan, and carve-out guarantees on property-level debt.

Mortgage Notes Payable

The mortgage notes payable collateralized by respective properties and assignment of leases at June 30, 2013 and December 31, 2012, respectively, were as follows:

Property	Maturity Date	Interest Rate			June 30, 2013		December 31, 2012
Gateway Village I	February 2014		5.58	%		6,638,629		6,718,119
Gateway Village II	May 2014		5.73	%		6,794,397		6,872,265
Euclid Plaza	November 2014		5.23	%		8,238,053		8,329,824
Country Club Gate	January 2015		5.04	%		12,357,860		12,477,997
Renaissance Towne Centre	June 2015		5.13	%		16,625,667		16,760,383
Gateway Village III	July 2016		6.10	%		7,414,797		7,460,907
Bernardo Heights	July 2017		5.70	%		8,826,429		—
Santa Teresa Village	February 2018		6.20	%		11,129,744		11,223,888
					$	78,025,576	$	69,843,383
Mortgage Premium						3,117,525		2,846,459
Total mortgage notes payable					$	81,143,101	$	72,689,842

Credit Facilities

The Operating Partnership has a revolving credit facility (the "credit facility") with several banks. The credit facility provides for borrowings of up to $200.0 million and contains an accordion feature, which allows the Operating Partnership to increase the facility amount up to an aggregate of $300.0 million subject to commitments and other conditions. The initial maturity date of the credit facility is August 29, 2016, subject to a one-year extension option, which may be exercised by the Operating Partnership upon satisfaction of certain conditions.

The Operating Partnership has a term loan agreement (the “term loan”) with several banks. The term loan provides for a loan of $200.0 million and contains an accordion feature, which allows the Operating Partnership to increase the facility amount up to an aggregate of $300.0 million subject to commitments and other conditions. The maturity date of the term loan is August 29, 2017.

The Company obtained investment grade credit ratings from Moody’s Investors Service (Baa2) and Standard & Poor’s Ratings Services (BBB-) credit agencies during the second quarter of 2013. Prior to receiving such investment grade ratings, borrowings under the credit facility and term loan agreements (collectively, the “loan agreements”) accrued interest on the outstanding principal amount at a rate equal to an applicable rate based on the consolidated leverage ratio of the Company and its subsidiaries, plus, as applicable, (i) a LIBOR rate determined by reference to the cost of funds for dollar deposits for the relevant period (the "Eurodollar Rate"), or (ii) a base rate determined by reference to the highest of (a) the federal funds rate plus 0.50%, (b) the rate of interest announced by KeyBank National Association as its "prime rate," and (c) the Eurodollar Rate plus 1.00% (the "Base Rate"). Effective as of June 26, 2013, and in connection with receiving the investment grade credit ratings from two rating agencies, borrowings under the loan agreements bear interest on the outstanding principal amount at a rate equal to an applicable rate based on the credit rating level of the Company, plus, as applicable, (i) the Eurodollar Rate, or (ii) the Base Rate. Prior to June 26, 2013, the Operating Partnership was obligated to pay an unused fee of (a) 0.35% of the undrawn balance if the total outstanding principal amount was less than 50% of the aggregate commitments or (b) 0.25% if the total outstanding principal amount was greater than or equal to 50% of the aggregate commitments, and a fronting fee at a rate of 0.125% per year with respect to each letter of credit issued under the agreements. Subsequent to June 26, 2013, the Operating Partnership is obligated to pay a facility fee at a facility fee rate based on the credit rating level of the Company, and a fronting fee at a rate of 0.125% per year with respect to each letter of credit issued under the agreements. The agreements contain certain representations, financial and other covenants typical for these types of facilities. The Operating Partnership’s ability to borrow under the loan agreements is subject to its compliance with the covenants and other restrictions on an ongoing basis. The Operating Partnership was in compliance with such covenants at June 30, 2013.

As of June 30, 2013, $200.0 million and $105.1 million were outstanding under the term loan and credit facility, respectively. The average interest rate on both the term loan and the credit facility during the three and six months ended June 30, 2013 was 1.8%. The Company had $94.9 million available to borrow under the credit facility at June 30, 2013. The Company had no available borrowings under the term loan.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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