Derivative Financial Instruments

9 Months Ended

Sep. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

Cash Flow Hedges of Interest Rate Risk

The Company's objective in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in Accumulated Other Comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings.

As of September 30, 2021, the Company did not have any outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk.

The table below presents the fair value of the Company’s derivative financial instruments as well as its classification on the consolidated balance sheets as of the dates indicated (dollars in thousands):

Derivatives as of:
September 30, 2021			December 31, 2020
Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Accounts payable and accrued liabilities	$	—	Accounts payable and accrued liabilities	$	23

The following table presents the effect of the Company’s interest rate swaps on the consolidated statements of comprehensive income (loss) for the dates indicated (dollars in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Amount of (loss) gain recognized on derivative in Other Comprehensive Income	$	(1)	$	—	$	(1)	$	(25)
Amount of (loss) gain reclassified from Accumulated Other Comprehensive Income into Interest expense	$	(2)	$	(5)	$	(12)	$	5
Total amount of Interest expense presented in the Consolidated Statements of Operations	$	1,535	$	1,731	$	4,804	$	5,400

During the three and nine months ended September 30, 2021, the Company accelerated the reclassification of losses of $12,000 from other comprehensive income to earnings as a result of the hedged forecasted transactions becoming probable not to occur.