Debt

Mortgage notes payable are collateralized by the following respective real estate properties and assignment of operating leases as of December 31, 2013 and 2012 (amounts in thousands):



	Principal Balance as of December 31, 2013			Principal Balance as of December 31, 2012		Stated Rate		Effective Rate⁽¹⁾		Maturity Date⁽²⁾
Mortgage debt collateralized by:
Fixed rate debt
501 Seventh Avenue
(Note 1)	$	1,037		$	1,075	5.75	%	6.28	%	8/1/2014
(Note 2)⁽³⁾	31,459			32,589		5.75	%	6.28	%	8/1/2014
(Note 2)⁽³⁾	6,889			7,107		6.04	%	6.55	%	8/1/2014
1359 Broadway
(first lien mortgage loan)	9,579			9,922		5.75	%	6.24	%	8/1/2014
(second lien mortgage loan)⁽⁴⁾	5,561			5,761		5.75	%	6.25	%	8/1/2014
(second lien mortgage loan)⁽⁴⁾	11,311			11,689		5.87	%	6.36	%	8/1/2014
(second lien mortgage loan)⁽⁴⁾	18,572			19,068		6.40	%	6.86	%	8/1/2014
One Grand Central Place
(first lien mortgage loan)	71,723			73,922		5.34	%	6.38	%	11/5/2014
(second lien mortgage loan)⁽⁵⁾	14,884			15,187		7.00	%	6.72	%	11/5/2014
500 Mamaroneck Avenue	32,620			33,256		5.41	%	6.70	%	1/1/2015
250 West 57th Street
(first lien mortgage loan)	25,621			26,442		5.33	%	6.92	%	1/5/2015
(second lien mortgage loan)	11,252			11,524		6.13	%	7.81	%	1/5/2015
Metro Center	96,158			—		5.89	%	6.15	%	1/1/2016
(Note 1)⁽⁶⁾	—			59,937		5.80	%	—	%	1/1/2016
(Note 2)⁽⁶⁾	—			38,151		6.02	%	—	%	1/1/2016
10 Union Square	20,972			21,284		6.00	%	6.48	%	5/1/2017
10 Bank Street	33,444			33,963		5.72	%	5.94	%	6/1/2017
1542 Third Avenue	19,011			19,370		5.90	%	6.31	%	6/1/2017
First Stamford Place	245,629			248,716		5.65	%	5.82	%	7/5/2017
1010 Third Avenue and 77 West 55th Street	28,096			28,570		5.69	%	6.12	%	7/5/2017
383 Main Avenue	30,403			30,924		5.59	%	5.72	%	7/5/2017
1333 Broadway	78,121		⁽¹⁵⁾	—		6.32	%	6.68	%	1/5/2018
1350 Broadway (first lien mortgage loan)	43,305		⁽¹⁶⁾	—		5.87	%	6.02	%	4/5/2018
69-97 Main Street ⁽⁷⁾	—			9,218		5.64	%	—		5/1/2013
Total fixed rate debt	835,647			737,675
Floating rate debt
501 Seventh Avenue (third lien mortgage loan)	6,540			6,540		⁽⁸⁾		⁽⁸⁾		8/1/2014
1350 Broadway (second lien mortgage loan)	13,543		⁽¹⁷⁾	—		⁽⁹⁾		⁽⁹⁾		10/10/2014
The Empire State Building (secured term loan)	—			219,000		⁽¹⁰⁾		⁽¹⁰⁾		7/26/2014
One Grand Central Place (third lien mortgage loan)	6,382			—		⁽¹¹⁾		⁽¹¹⁾		11/5/2014
250 West 57th Street (third lien mortgage loan)	21,000			14,935		⁽¹²⁾		⁽¹²⁾		1/5/2015
Secured revolving credit facility	25,000			—		⁽¹³⁾		⁽¹³⁾		10/5/2017
Secured term credit facility	300,000			—		⁽¹⁴⁾		⁽¹⁴⁾		10/5/2018
Total floating rate debt	372,465			240,475
Total	$	1,208,112		$	978,150

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(1)	The effective rate is the yield as of December 31, 2013, including the effects of debt issuance costs.


(2)	Pre-payment is generally allowed for each loan upon payment of a customary pre-payment penalty.


(3)	Represents the two tranches of the second lien mortgage loan.


(4)	Represents three tranches of the second lien mortgage loan.


(5)	Represents a second lien mortgage loan.


(6)	Notes 1 and 2 were pari passu.


(7)	This loan was paid off with the proceeds of a new $9.5 million floating rate loan which we closed on during April 2013 and which was subsequently repaid during December 2013.


(8)	Floating at 30 day LIBOR plus 2.0%. The rate as of December 31, 2013 was 2.17%.


(9)	Interest at the greater of 4.25% and Prime plus 1%. The rate at December 31, 2013 was 4.25%.


(10)	Floating at 30 day LIBOR plus 2.5%. The rate as of December 31, 2013 was 2.67%. This loan was paid off with the proceeds of our secured revolving and term credit facility on October 7, 2013.


(11)	Interest at the greater of Prime plus 0.50% and 3.75%. The rate as of December 31, 2013 was 3.75%.

(12)

Interest at the greater of 4.25% and prime plus 1%. Prior to January 5, 2015, we have the option to fix the interest rate on all or any portion of the principal then outstanding, up to three times and in minimum increments of $5,000 to an annual rate equal to either (i) the greater of (a) 4.75% or (b) 300 basis points in excess of the weekly average yield on United States Treasury Securities adjusted to a maturity closest to January 5, 2015 as most recently made available by the Federal Reserve Board as of two days prior to the effective date of the fixing of the interest rate, and (ii) the greater of (a) 5.00% or (b) 300 basis points in excess of the weekly average yield on United States Treasury Securities adjusted to a maturity closest to January 5, 2015 as most recently made available by the Federal Reserve Board as of 30 days prior to the effective date of the fixing of the interest rate. If option (i) is selected, we will be subject to the payment of pre‑payment fees, and if option (ii) is selected, we may prepay the loan without any pre‑payment fees. The rate as of December 31, 2013 was 4.25%.


(13)	Floating at 30 day LIBOR plus 1.20%. The rate as of December 31, 2013 was 1.37%.


(14)	Floating at 30 day LIBOR plus 1.35%. The rate at December 31, 2013 was 1.52%.


(15)	Includes unamortized premium of $7,674.


(16)	Includes unamortized premium of $3,885.


(17)	Includes unamortized premium of $134.

Principal Payments

Aggregate required principal payments on mortgage notes payable at December 31, 2013 are as follows (amounts in thousands):



2014	$	197,480
2015	90,493
2016	96,158
2017	402,555
2018	421,426
Total principal maturities	$	1,208,112

Secured Revolving and Term Credit Facility

We entered into an agreement for a secured revolving and term credit facility in the maximum aggregate original principal amount of up to $800.0 million with an accordion feature to increase the availability to $1.25 billion under certain circumstances. The secured revolving and term credit facility was used to fully repay the existing $500.0 million term loan previously secured by the Empire State Building, which had a balance of $300.0 million. The secured revolving and term credit facility has an outstanding balance of $325.0 million at December 31, 2013.

Amounts outstanding under the term loan bear interest at a floating rate equal to, at our election, (x) a Eurodollar rate, plus a spread ranging from 1.00% to 2.00% depending upon our leverage ratio and credit rating which, at December 31, 2013, was 1.35%; or (y) a base rate, plus a spread ranging from 0.00% to 1.00% depending upon our leverage ratio and credit rating which, at December 31, 2013, was 0.35%. Amounts outstanding under the revolving credit facility bear interest at a floating rate equal to, at our election, (x) a Eurodollar rate, plus a spread ranging from 0.925% to 1.70% depending upon our leverage ratio and credit rating which, at December 31, 2013, was 1.20%; or (y) a base rate, plus a spread ranging from 0.00% to 0.70% depending upon our leverage ratio and credit rating which, at December 31, 2013, was 0.20%. In addition, the revolving credit facility permits us to borrow at competitive bid rates determined in accordance with the procedures described in the revolving credit facility.

The term loan has a term of five years and the revolving credit facility has an initial term of four years. We have the option to extend the initial term of the revolving credit facility for an additional one-year period, subject to certain conditions, including the payment of an extension fee equal to 0.20% of the then-outstanding commitments under the revolving credit facility. The secured revolving and term credit facility also includes an unused facility fee of 0.20%. In addition, the secured revolving and term credit facility includes covenants which may restrict our ability to pay dividends if we fail to meet certain tests.

As of December 31, 2013, availability under the secured revolving and term credit facility is reduced by $33.2 million until certain capital expenditures at the Empire State Building are made by us from proceeds from the secured revolving and term credit facility or cash on hand.

Unsecured Loan and Notes Payable

Our predecessor held unsecured notes payable totaling $14.7 million to trusts which benefit parties related to the sponsors. The notes bore interest at a rate of 1.2% compounded annually and are due on November 14, 2020. This liability was distributed to certain owners of our predecessor and was not assumed by us during the Offering and formation transactions.

On April 21, 2011, one of the combined entities (500 Mamaroneck, L.P.) entered into a promissory note agreement with the sponsors, as agents for certain investors in 500 Mamaroneck, L.P. (“2011 Promissory Note”), under which such investors loaned $3.6 million (including $1.2 million from the sponsors) to 500 Mamaroneck, L.P. Loans made pursuant to the 2011 Promissory Note earn interest at the rate of 10% per annum, payable quarterly, beginning July 1, 2011. The loans had a maturity date of the earliest of (i) January 1, 2015, (ii) sale or transfer of title to the property, or (iii) satisfaction of the existing first mortgage loan on the property. Loans made under the 2011 Promissory Note were repayable without penalty at any time in part or in full, along with all accrued interest. During October 2013, this loan was repaid with proceeds of the Offering.

During April 2013, our predecessor received a loan from an entity, which is controlled by Anthony E. Malkin and Peter L. Malkin, made to fund cash needs including the payment of leasing commissions and expenditures on tenant installations at First Stamford Place. The loan had a principal amount of $4.5 million, an outstanding balance of $3.8 million, and bore interest at 30-day LIBOR plus 2.5% (2.67% at December 31, 2013). During October 2013, this loan was repaid with proceeds from the Offering.