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Derivatives and Hedging Activities (Tables)

6 Months Ended

Jun. 30, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated balance sheets as of June 30, 2024 and December 31, 2023:


(In thousands)	Balance Sheet Location	June 30, 2024		December 31, 2023
Derivatives designated as hedging instruments:




Interest rate “pay-fixed” swaps (USD)	Derivative liabilities, at fair value	$	—	$	(2,110)
Interest rate “pay-fixed” swaps (USD)	Derivative assets, at fair value	3,527		—

Interest rate “pay-fixed” swaps (GBP)	Derivative liabilities, at fair value	(131)		—
Interest rate “pay-fixed” swaps (EUR)	Derivative assets, at fair value	6,256		5,987

Total		$	9,652	$	3,877
Derivatives not designated as hedging instruments:
Foreign currency forwards (GBP-USD)	Derivative assets, at fair value	$	486	$	878
Foreign currency forwards (GBP-USD)	Derivative liabilities, at fair value	(1,342)		(1,906)
Foreign currency forwards (EUR-USD)	Derivative assets, at fair value	599		588
Foreign currency forwards (EUR-USD)	Derivative liabilities, at fair value	(84)		(1,129)

Interest rate swaps (EUR)	Derivative assets, at fair value	474		3,162

Total		$	133	$	1,593

Schedule of Interest Rate Derivatives

As of June 30, 2024 and December 31, 2023, the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk:


	June 30, 2024			December 31, 2023
Derivatives	Number of Instruments	Notional Amount		Number of Instruments	Notional Amount
		(In thousands)			(In thousands)
Interest rate “pay-fixed” swaps (GBP)	3	$	200,000	—	$	—
Interest rate “pay-fixed” swaps (EUR) (1)	11	529,200		11	308,233
Interest rate “pay-fixed” swaps (USD)	9	600,000		5	300,000
Total	23	$	1,329,200	16	$	608,233

________

(1) The Company entered into four additional interest rate swaps for a notional amount of approximately €250 million in July 2022 to replace existing swaps set to expire, which are not yet effective until August 1, 2024 and therefore, are not included in the notional amount in the table above.

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance

The table below details the location in the consolidated financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three and six months ended June 30, 2024 and 2023.


	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2024		2023		2024		2023
Amount of gain recognized in AOCI from derivatives	$	7,390	$	3,917	$	14,382	$	2,940
Amount of (loss) gain reclassified from AOCI into income as interest expense	$	4,806	$	4,481	$	8,437	$	7,771
Total interest expense recorded in the consolidated statements of operations	$	89,815	$	27,710	$	172,568	$	54,675

Schedule of Disclosure of Credit Derivatives

As of June 30, 2024 and December 31, 2023, the Company had the following outstanding derivatives that were not designated as hedges under qualifying hedging relationships.


	June 30, 2024			December 31, 2023
Derivatives	Number of Instruments	Notional Amount		Number of Instruments	Notional Amount
		(In thousands)			(In thousands)
Foreign currency forwards (GBP-USD)	29	$	55,010	29	$	54,745
Foreign currency forwards (EUR-USD)	25	36,972		28	41,952
Interest rate swaps (EUR)	3	149,549		3	154,062




Total	57	$	241,531	60	$	250,759

Schedule of Offsetting Assets

The table below presents a gross presentation, the effects of offsetting, and a net presentation of the Company’s derivatives as of June 30, 2024 and December 31, 2023. The net amounts of derivative assets or liabilities can be reconciled to the tabular disclosure of fair value. The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented on the accompanying consolidated balance sheets.


						Gross Amounts Not Offset on the Balance Sheet
(In thousands)	Gross Amounts of Recognized Assets		Gross Amounts of Recognized (Liabilities)	Gross Amounts Offset on the Balance Sheet	Net Amounts of (Liabilities) Assets presented on the Balance Sheet	Financial Instruments	Cash Collateral Received (Posted)	Net Amount
June 30, 2024	$	11,342	(1,557)	—	9,785	—	—	$	9,785
December 31, 2023	$	10,615	(5,145)	—	5,470	—	—	$	5,470

- Definition

Tabular disclosure of credit derivatives which includes information by sellers of credit derivatives, about each credit derivative, or each group of similar credit derivatives, including (a) the nature of the credit derivative - its term, how it arose, the events or circumstances that would require the seller to perform under the credit derivative, and the current status of the payment/performance risk of the credit derivative; (b) the maximum potential amount of future payments (undiscounted) the seller could be required to make under the credit derivative; (c) the current fair value of the credit derivative; and (d) the nature of any recourse provisions under the credit derivative, and any assets held either as collateral or by third parties. A credit derivative is a derivative instrument (1) in which one or more of its underlyings are related to the credit risk of a specified entity (or a group of entities) or an index based on the credit risk of a group of entities and (2) that exposes the seller to potential loss from credit-risk-related events specified in the contract. Examples of credit derivatives within the scope of this paragraph include, but are not limited to, credit default swaps, credit spread options, and credit index products; also includes a hybrid instrument that has an embedded credit derivative (for example, but not limited to, a credit-linked note).

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