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Derivative Financial Instruments
12 Months Ended
Dec. 31, 2013
Derivative Financial Instruments
10. Derivative Financial Instruments

During the year ended December 31, 2013, Armada Hoffler entered into four LIBOR interest rate cap agreements on an aggregate notional amount of $121.5 million with strike prices ranging between 1.50% and 3.50% for collective premiums totaling $0.3 million. All four interest rate cap agreements expire in 2016.

Armada Hoffler’s derivatives comprised the following as of December 31, 2013 and 2012 (in thousands):

 

     December 31,  
     2013     2012  
     Notional
Amount 
     Fair Value     Notional
Amount
     Fair Value  
            Asset      Liability            Asset      Liability  

Pay fixed interest rate swaps

   $ 705      $ —        $ (16 )   $ 11,721      $ —        $ (239 )

Interest rate caps

     130,672        102        —         9,356        9         —    
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Total

   $ 131,377      $ 102      $ (16 )   $ 21,077      $ 9       $ (239 )
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

The changes in the fair value of Armada Hoffler’s derivatives during each of the three years ended December 31, 2013 was as follows (in thousands):

 

     Years Ended December 31,  
     2013     2012     2011  

Pay fixed interest rate swaps

   $ 152     $ 445     $ 436  

Interest rate caps

     (164 )     (37 )     —    
  

 

 

   

 

 

   

 

 

 

Other (expense) income

   $ (12 )   $ 408     $ 436  
  

 

 

   

 

 

   

 

 

 

 

Subsequent to December 31, 2013

On March 14, 2014, the Company executed a LIBOR interest rate cap agreement on a notional amount of $50.0 million and a strike price of 1.25% for a premium of $0.4 million. The interest rate cap agreement expires on March 1, 2017.