Indebtedness

The Company’s indebtedness was comprised of the following as of December 31, 2017 and 2016 (dollars in thousands):



							Stated Interest		Stated Maturity
	Principal Balance						Rate		Date
	December 31,						December 31,
	2017			2016			2017
North Point Center Note 5	$	—		$	643		LIBOR + 2.00%		February 1, 2017
Harrisonburg Regal	—			3,256			6.06	%	June 8, 2017
Commonwealth of Virginia - Chesapeake	—			4,933			LIBOR + 1.90%		August 28, 2017
Sandbridge Commons (2)	8,468			9,376			LIBOR + 1.75%		January 17, 2018
Columbus Village Note 1 (1)	6,080			6,258			LIBOR + 2.00%		April 5, 2018
Columbus Village Note 2	2,218			2,266			LIBOR + 2.00%		April 5, 2018
Johns Hopkins Village	46,698			43,841			LIBOR + 1.90%		July 30, 2018
Lightfoot Marketplace	10,500			12,194			LIBOR + 1.75%		November 14, 2018
North Point Note 1	9,571			9,776			6.45	%	February 5, 2019
Harding Place	3,874			—			LIBOR + 2.95%		February 24, 2020
Town Center Phase VI	1,505			—			LIBOR + 3.50%		June 29, 2020
Southgate Square	20,708			21,150			LIBOR + 2.00%		April 29, 2021
249 Central Park Retail (3)	16,851			17,076			LIBOR + 1.95%		August 8, 2021
Fountain Plaza Retail (3)	10,145			10,281			LIBOR + 1.95%		August 8, 2021
South Retail (3)	7,394			7,493			LIBOR + 1.95%		August 8, 2021
4525 Main Street (4)	32,034			32,034			3.25	%	September 10, 2021
Encore Apartments (4)	24,966			24,966			3.25	%	September 10, 2021
Revolving credit facility	66,000			107,000			LIBOR+1.40%-2.00%		October 26, 2021
Hanbury Village	19,503			20,709			0.0378		August 15, 2022
Term loan (1)	50,000			50,000			LIBOR+1.35%-1.95%		October 26, 2022
Term loan	100,000			50,000			LIBOR+1.35%-1.95%		October 26, 2022
Socastee Commons	4,771			4,866			4.57	%	January 6, 2023
North Point Note 2	2,459			2,564			7.25	%	September 15, 2025
Smith's Landing	19,764			20,511			4.05	%	June 1, 2035
Liberty Apartments	14,694			20,005			5.66	%	November 1, 2043
The Cosmopolitan	45,209			45,884			3.35	%	July 1, 2051
Total principal balance	$	523,412		$	527,082
Unamortized fair value adjustments	(1,211		)	(1,250		)
Unamortized debt issuance costs	(4,929		)	(3,652		)
Indebtedness, net	$	517,272		$	522,180

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(1)	Subject to an interest rate swap agreement.


(2)	Subsequent to December 31, 2017, the Sandbridge Commons mortgage was extended for an additional 5 years.


(3)	Cross collateralized.


(4)	Cross collateralized.

The Company’s indebtedness was comprised of the following fixed and variable-rate debt as of December 31, 2017 and 2016 (in thousands):



	December 31,
	2017		2016
Fixed-rate debt	$	229,051	$	241,472
Variable-rate debt	294,361		285,610
Total principal balance	$	523,412	$	527,082

Certain loans require the Company to comply with various financial and other covenants, including the maintenance of minimum debt coverage ratios. As of December 31, 2017, the Company was in compliance with all loan covenants.

Scheduled principal repayments and maturities during each of the next five years and thereafter are as follows (in thousands):



Year	Scheduled Principal Payments		Maturities		Total Payments
2018	$	4,361	$	73,322	$	77,683
2019	3,951		9,333		13,284
2020	4,959		5,379		10,338
2021	4,073		172,274		176,347
2022	2,699		167,109		169,808
Thereafter	70,385		5,567		75,952
Total	$	90,428	$	432,984	$	523,412

Credit Facility

On October 26, 2017, the Operating Partnership entered into an amended and restated credit agreement (the “amended credit agreement”), which provides for a $300.0 million credit facility comprised of a $150.0 million senior unsecured revolving credit facility (the "revolving credit facility") and a $150.0 million senior unsecured term loan facility (the “term loan facility” and, together with the revolving credit facility, the “credit facility”), with a syndicate of banks. The amended credit facility replaces the prior $150.0 million revolving credit facility, which was scheduled to mature on February 20, 2019, and the prior $125.0 million term loan facility, which was scheduled to mature on February 20, 2021.

The credit facility includes an accordion feature that allows the total commitments to be increased to $450.0 million, subject to certain conditions, including obtaining commitments from any one or more lenders. The revolving credit facility has a scheduled maturity date of October 26, 2021, with two six-month extension options, subject to certain conditions, including payment of a 0.075% extension fee at each extension. The term loan facility has a scheduled maturity date of October 26, 2022.

The revolving credit facility bears interest at LIBOR plus a margin ranging from 1.40% to 2.00% and the term loan facility bears interest at LIBOR plus a margin ranging from 1.35% to 1.95%, in each case depending on the Company's total leverage. The Company is also obligated to pay an unused commitment fee of 15 or 25 basis points on the unused portions of the commitments under the revolving credit facility, depending on the amount of borrowings under the credit facility. As of December 31, 2017, the interest rates on the revolving credit facility and the term loan facility were 3.11% and 3.06%, respectively. If the Company attains investment grade credit ratings from S&P and Moody’s, the Operating Partnership may elect to have borrowings become subject to interest rates based on such credit ratings. The Company may, at any time, voluntarily prepay any loan under the credit facility in whole or in part without premium or penalty.

The Operating Partnership is the borrower under the credit facility, and its obligations under the credit facility are guaranteed by the Company and certain of its subsidiaries that are not otherwise prohibited from providing such guaranty. The credit agreement contains customary representations and warranties and financial and other affirmative and negative covenants. The Company's ability to borrow under the credit facility is subject to ongoing compliance with a number of financial covenants, affirmative covenants and other restrictions. The credit agreement includes customary events of default, in certain cases subject to customary cure periods. The occurrence of an event of default, if not cured within the applicable cure period, would permit the lenders to, among other things, declare the unpaid principal, accrued and unpaid interest and all other amounts payable under the credit facility to be immediately due and payable.

The Company is currently in compliance with all covenants under the credit facility.

Other 2017 Financing Activity

On February 1, 2017, the Company paid off the North Point Center Note 5 in full for $0.6 million.

On February 24, 2017, the Company secured a $29.8 million construction loan for the Harding Place project in Charlotte, North Carolina.

On April 7, 2017, the Company paid off the Harrisonburg Regal note in full for $3.2 million.

On April 19, 2017, the Company entered into a second amendment to the credit agreement for the Lightfoot Marketplace loan, which amended certain definitions and covenant requirements.

On June 29, 2017, the Company secured a $27.9 million construction loan for the Town Center Phase VI project in Virginia Beach, Virginia.

On July 13, 2017, the Company paid off the remaining balance of $4.9 million for the note secured by the Commonwealth of Virginia building in Chesapeake, Virginia in conjunction with the sale of this property.

On August 9, 2017, the Company refinanced the Hanbury Village note. The new note matures in August 2022 and has a fixed annual interest rate of 3.78%.

On August 10, 2017, the Company paid off $0.7 million of the Sandbridge Commons note in conjunction with the sale of a land outparcel at this property.

On September 1, 2017, the Company entered into a modification of The Cosmopolitan note, which reduced the interest rate from 3.75% to 3.35%.

On October 13, 2017, the Company paid down $5.0 million of the Liberty Apartments note.

On November 1, 2017, the Company extended the Lightfoot construction loan after paying the balance down to $10.5 million and paying an extension fee. The loan is now set to mature in November 2018.

On December 28, 2017, the Company secured a $66.5 million construction loan for the 595 King Street and 530 Meeting Street development projects. There are no borrowings on this loan as of December 31, 2017.

During the year ended December 31, 2017, the Company borrowed $8.9 million under its construction loans to fund new development and construction.

Subsequent to December 31, 2017

On January 22, 2018, the Company extended the Sandbridge Commons mortgage. The loan bears interest at a rate of LIBOR plus a spread of 1.75% and will mature on January 17, 2023.

In January 2018, the Company increased its borrowings under the revolving credit facility by $58.0 million.

Other 2016 Financing Activity

On August 8, 2016, the Company repaid the existing $15.1 million mortgage loan secured by 249 Central Park Retail, the $6.7 million mortgage loan on South Retail and the $7.6 million mortgage loan on Fountain Plaza and refinanced them with a $35.0 million five-year term mortgage loan that bears interest at LIBOR plus 1.95% and matures on August 8, 2021. The new mortgage loan is collateralized by all three properties. The loss on extinguishment of debt recognized on the refinancing was less than $0.1 million.

On August 30, 2016, the Company repaid the existing $31.6 million construction loan secured by 4525 Main Street and the $25.2 million construction loan on Encore Apartments and refinanced them with a $57.0 million five-year term mortgage loan that bears interest at 3.25% and matures on September 10, 2021. The new mortgage is collateralized by both properties. The loss on extinguishment of debt recognized on the refinancing was less than $0.1 million for the year ended December 31, 2016.

During the year ended December 31, 2016, the Company borrowed $44.4 million under its construction loans to fund new development and construction.

Other 2015 Financing Activity

On May 20, 2015, the Company repaid the $17.8 million construction loan secured by Whetstone Apartments and recognized a loss on extinguishment of debt of $0.1 million representing unamortized debt issuance costs.

On May 27, 2015, the Company repaid the existing $24.4 million mortgage secured by Smith’s Landing and refinanced the property with a new $21.6 million loan that bears interest at 4.05% and matures on June 1, 2035. As a result of the refinancing, the Company recognized a $0.1 million loss on extinguishment of debt representing the unamortized debt issuance costs associated with the repaid mortgage.

On July 1, 2015, the Company assumed debt with an outstanding principal balance of $5.0 million in connection with the acquisition of Socastee Commons. The mortgage bears interest at 4.57% and matures on January 6, 2023.

On July 10, 2015, the Company assumed two loans with an aggregate outstanding principal balance of $8.8 million in connection with the acquisition of Columbus Village. Both loans bear interest at LIBOR plus 2.00% and mature on April 5, 2018.

On July 30, 2015, the Company entered into a $50.0 million loan agreement to fund the development and construction of Johns Hopkins Village. The construction loan bears interest at LIBOR plus 1.90% and matures on July 30, 2018.

On September 1, 2015, the Company repaid the $6.1 million mortgage secured by the Oyster Point office building.

On October 6, 2015, the Operating Partnership entered into a $6.4 million note secured by the Oyster Point office building, which bears interest at LIBOR plus 1.40% to 2.00% and matures on February 28, 2017. This note was paid in full in conjunction with the sale of the Oyster Point office building.

On October 30, 2015, the Company repaid the $18.7 million construction loan secured by the Oceaneering International building and recognized a loss on debt extinguishment of debt of $0.1 million representing unamortized debt issuance costs.