As of June 30, 2024 and December 31, 2023, the Company had the following mortgages and credit facility payable:


	June 30, 2024						December 31, 2023
Type of Debt	Principal Amount			Weighted Average Interest Rate			Principal Amount			Weighted Average Interest Rate
Fixed rate mortgages payable	$	111,851			3.84	%	$	112,019			3.84	%
Variable rate mortgages payable with swap agreements		26,000			4.55	%		26,000			4.55	%
Mortgages payable		137,851			3.97	%		138,019			3.97	%
Credit facility payable		705,000			4.94	%		709,000			4.95	%
Total debt before unamortized debt issuance costs including impact of interest rate swaps		842,851			4.78	%		847,019			4.79	%
(Less): Unamortized debt issuance costs		(2,531	)					(3,129	)
Total debt	$	840,320					$	843,890

The Company’s indebtedness bore interest at a weighted average interest rate of 4.78% per annum as of June 30, 2024, which includes the effects of interest rate swaps. The Company estimates the fair value of its total debt by discounting the future cash flows of each instrument at rates currently offered for similar debt instruments of comparable maturities by the Company’s lenders using Level 3 inputs. The carrying value of the Company’s debt excluding unamortized debt issuance costs was $842,851 and $847,019 as of June 30, 2024 and December 31, 2023, respectively, and its estimated fair value was $837,499 and $841,313 as of June 30, 2024 and December 31, 2023, respectively.

As of June 30, 2024, scheduled principal payments and maturities on the Company’s debt were as follows:


	June 30, 2024
Scheduled Principal Payments and Maturities by Year:	Scheduled Principal Payments		Maturities of Mortgage Loans		Maturity of Credit Facility		Total
2024 (remainder of the year)	$	173	$	—	$	—	$	173
2025		295		92,656		—		92,951
2026		—		44,727		130,000		174,727
2027		—		—		575,000		575,000
2028		—		—		—		—
Thereafter		—		—		—		—
Total	$	468	$	137,383	$	705,000	$	842,851

On February 3, 2022, the Company entered into a second amended and restated credit agreement (the “Credit Agreement”) with KeyBank National Association, individually and as administrative agent, KeyBanc Capital Markets Inc., PNC Capital Markets LLC and BofA Securities, Inc., as joint lead arrangers, and other lenders from time to time parties to the Credit Agreement (the “Credit Facility”).

Pursuant to the Credit Agreement, the aggregate total commitments under the Credit Facility were increased from $350,000 to $475,000. The Credit Facility consists of the “Revolving Credit Facility” providing revolving credit commitments in an aggregate amount of $200,000 and a term loan facility (the term loans funded under such commitments, the “Term Loan”) providing term loan commitments in an aggregate amount of $275,000 (increased from $150,000). On May 17, 2022, the Company entered into a First Amendment to Credit Agreement Regarding Incremental Term Loans (the “First Amendment”), amending the terms of the Credit Agreement primarily to draw an additional $300,000. The Credit Agreement provides the Company with the ability from time to time to increase the size of the Credit Facility up to a total of $1,200,000, subject to certain conditions.

The Revolving Credit Facility matures on February 3, 2026, and the Company has the option to extend the maturity date for one additional year subject to the payment of an extension fee and certain other conditions. The Term Loan matures on February 3, 2027. Borrowings under the Credit Facility bear interest equal to one-month Term Secured Overnight Financing Rate (“SOFR”) plus a margin, the amount of which depends on the Company’s leverage ratio.

As of June 30, 2024, the Company had $130,000 outstanding under the Revolving Credit Facility and $575,000 outstanding under the Term Loan. As of June 30, 2024, the interest rates on the Revolving Credit Facility and the Term Loan were 7.34% and 4.39%, respectively. As of June 30, 2024, the Company had a maximum amount of $70,000 available for borrowing under the Revolving Credit Facility, subject to the terms and conditions of the Credit Agreement that governs the Credit Facility, including compliance with the covenants which could further limit the amount available. Although all of the amount available under the Revolving Credit Facility is available to pay off existing mortgages, due to the covenant limitations, the Company expects to have substantially less than all $70,000 available to draw or otherwise undertake as additional debt.

The Company’s performance of the obligations under the Credit Facility, including the payment of any outstanding indebtedness under the Credit Facility, is guaranteed by certain subsidiaries of the Company, including each of the subsidiaries of the Company which owns or leases any of the properties included in the pool of unencumbered properties comprising the borrowing base. Additional properties will be added to and removed from the pool from time to time to support amounts borrowed under the Credit Facility so long as at any time there are at least fifteen unencumbered properties with an unencumbered pool value of $300,000 or more. As of June 30, 2024, there were 47 properties included in the pool of unencumbered properties.

The Credit Facility requires compliance with certain covenants, including a minimum tangible net worth requirement, a limitation on the use of leverage, a distribution limitation, restrictions on indebtedness and investment restrictions, as defined. It also contains customary default provisions including the failure to comply with the Company's covenants and the failure to pay when amounts outstanding under the Credit Facility become due. As of June 30, 2024, the Company was in compliance with all financial covenants related to the Credit Facility as amended.

The Company’s mortgage loans require compliance with certain covenants, such as debt service ratios, investment restrictions and distribution limitations. As of June 30, 2024, the Company was current on all of its debt service payments and in compliance with all financial covenants. All of the Company’s mortgage loans are secured by first mortgages on the respective real estate assets. As of June 30, 2024, the weighted average years to maturity for the Company’s mortgages payable was 1.5 years. There are no mortgage loans maturing in the next twelve months.

The Company entered into interest rate swaps to fix certain of its floating SOFR based debt under variable rate loans to a fixed rate to manage its risk exposure to interest rate fluctuations. The Company will generally match the maturity of the underlying variable rate debt with the maturity date on the interest swap. See Note 13 – “Fair Value Measurements” for further information.

As of June 30, 2024, the Company had hedged all of its variable rate mortgage loans of $26,000 and $525,000 of the Term Loan using interest rate swap contracts. The following table summarizes the Company’s interest rate swap contracts outstanding as of June 30, 2024.


Date Entered	Effective Date	Maturity Date	Receive Floating Rate Index (a)	Pay Fixed Rate			Notional Amount		Fair Value as of June 30, 2024
Assets
December 5, 2022	December 1, 2022	January 1, 2026	One-month Term SOFR		2.25	%		26,000		923
February 3, 2022	March 1, 2022	February 3, 2027	One-month Term SOFR		1.69	%		90,000		5,834
February 3, 2022	March 1, 2022	February 3, 2027	One-month Term SOFR		1.85	%		100,000		6,089
February 3, 2022	March 1, 2022	February 3, 2027	One-month Term SOFR		1.72	%		85,000		5,470
May 17, 2022	June 1, 2022	February 3, 2027	One-month Term SOFR		2.71	%		60,000		2,383
May 17, 2022	June 1, 2022	February 3, 2027	One-month Term SOFR		2.71	%		60,000		2,384
May 17, 2022	June 1, 2022	February 3, 2027	One-month Term SOFR		2.71	%		75,000		2,980
May 17, 2022	June 1, 2022	February 3, 2027	One-month Term SOFR		2.77	%		55,000		2,114
							$	551,000	$	28,177

(a)

As of June 30, 2024, the one-month term SOFR was 5.34%.

The table below presents the effect of the Company’s derivative financial instruments on the consolidated statements of operations and comprehensive income (loss) for the three and six months ended June 30, 2024 and 2023.


	Three Months Ended June 30,						Six Months Ended June 30,
Derivatives in Cash Flow Hedging Relationships	2024			2023			2024			2023
Effective portion of derivatives	$	3,187		$	14,170		$	13,253		$	9,625
Reclassification adjustment for amounts included in net gain or loss (effective portion)	$	(4,322	)	$	(3,849	)	$	(8,659	)	$	(7,334	)

The total amount of interest expense presented on the consolidated statements of operations and comprehensive income (loss) was $10,386 and $10,806, for the three months ended June 30, 2024 and 2023, respectively. The total amount of interest expense presented on the consolidated statements of operations and comprehensive income (loss) was $20,816 and $21,215, for the six months ended June 30, 2024 and 2023, respectively. The net gain or loss reclassified into income from accumulated other comprehensive income (loss) is reported in interest expense on the consolidated statements of operations and comprehensive income (loss). The amount that is expected to be reclassified from accumulated other comprehensive income into income (loss) in the next 12 months is $15,211.