Debt Obligations

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Debt Obligations

Debt Obligations

Debt obligations consist of the following (dollars in thousands):

	June 30, 2021		December 31, 2020
Mortgages payable	$	115,178	$	130,997
Junior subordinated notes	37,400		37,400
Deferred financing costs	(740)		(880)
Total debt obligations, net of deferred costs	$	151,838	$	167,517

Mortgages Payable

The weighted average interest rate on the Company's mortgage payables at June 30, 2021 was 4.14% and the weighted average remaining term to maturity is 4.34 years. For the three months ended June 30, 2021 and 2020, interest expense, which includes amortization of deferred financing costs, was $1,378,000 and $1,468,000, respectively. For the six months ended June 30, 2021 and 2020, interest expense, which includes amortization of deferred financing costs, was $2,808,000 and $2,943,000, respectively.

In July 2021, the Company paid down $17,000,000 of mortgage debt pertaining to a primary loan of one property and a supplemental loan of a second property. Such debt was scheduled to mature in 2022 and bore a weighted average interest rate of 4.46%.

Credit Facility

The Company's credit facility with an affiliate of Valley National Bank, as amended and modified from time-to-time, allows the Company to borrow, subject to compliance with borrowing base requirements and other conditions, up to $15,000,000 to facilitate the acquisition of multi-family properties and for working capital (including dividend payments) and operating expenses. The facility is secured by the cash available in certain cash accounts maintained by the Company at Valley National Bank, matures April 2023 and bears an adjustable interest rate of 50 basis points over the prime rate, with a floor of 4.25%. The interest rate in effect as of June 30, 2021 is 4.25%. There is an unused facility fee of 0.25% per annum on the difference between the outstanding loan balance and maximum amount then available under the facility. For the three months ended June 30, 2021 and 2020, interest expense, which includes amortization of deferred financing costs and unused fees, was $19,000 and $47,000. For the six months ended June 30, 2021 and 2020, interest expense, which includes amortization of deferred financing costs and unused fees, was $36,000 and $62,000. Deferred financing costs of $30,000 and $12,000, are recorded in other assets on the Consolidated balance sheets at June 30, 2021 and December 31, 2020, respectively. At June 30, 2021, the Company is in compliance in all material respects with its obligation under the facility. At June 30, 2021 and July 31, 2021, there was no outstanding balance on the facility.

Junior Subordinated Notes

At June 30, 2021 and December 31, 2020, the outstanding principal balance of the Company's junior subordinated notes was $37,400,000, before deferred financing costs of $307,000 and $317,000, respectively. The interest rate on the

outstanding balance resets quarterly and is based on three months LIBOR + 2.00%. The rate in effect at June 30, 2021 and 2020 was 2.21% and 2.76%, respectively. The notes mature April 30, 2036.The junior subordinated notes require interest only payments through the maturity date of April 30, 2036, at which time repayment of the outstanding principal and unpaid interest become due. Interest expense for the three months ended June 30, 2021 and 2020, which includes amortization of deferred financing costs, was $212,000 and $293,000, respectively. Interest expense for the six months ended June 30, 2021 and 2020, which includes amortization of deferred financing costs, was $426,000 and $663,000, respectively.