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Fair Value of Derivative and Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2019

Summary of Company's Outstanding Interest Rate Swaps

As of March 31, 2019, the Company had the following outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk (dollars in thousands):

Effective Date	Termination Date	Notional		Fixed Rate (1)
July 1, 2016	June 1, 2021	$	100,000		1.1055	%
July 1, 2016	June 1, 2021		100,000		1.0210	%
July 1, 2016	June 1, 2021		100,000		0.9000	%
September 1, 2016	June 1, 2021		100,000		0.9560	%
April 1, 2017	April 1, 2022		100,000		1.9570	%
May 1, 2017	April 1, 2022		50,000		1.9610	%
July 1, 2017	July 1, 2022		100,000		1.7820	%
		$	650,000		1.3388	%	(2)

(1)	The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2019, one-month LIBOR was 2.4945%.

(2)	Represents the weighted average fixed rate of the interest rate swaps.

Schedule of Outstanding Interest Rate Derivatives

As of March 31, 2019, the Company had the following outstanding derivatives that were not designated as hedges in qualifying hedging relationships (dollars in thousands):

Product

Number of

Instruments

Notional

Interest rate caps

310,028

Summary of Derivative Financial Instruments and Classification on the Consolidated Balance Sheet

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 March 31, 2019 and December 31, 2018 (in thousands):

		Asset Derivatives				Liability Derivatives
	Balance Sheet Location	March 31, 2019		December 31, 2018		March 31, 2019		December 31, 2018
Derivatives designated as hedging instruments:
Interest rate swaps	Fair market value of interest rate swaps	$	12,467	$	18,141	$	—	$	—

Derivatives not designated as hedging instruments:
Interest rate caps	Prepaid and other assets		4		10		—		—
Total		$	12,471	$	18,151	$	—	$	—

Summary of Derivative Financial Instruments on Consolidated Statements of Operations and Comprehensive Income

The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations and comprehensive income for the three months ended March 31, 2019 and 2018 (in thousands):

	Amount of gain (loss) recognized in OCI						Location of gain (loss) reclassified from accumulated	Amount of gain (loss) reclassified from OCI into income					Location of gain (loss) recognized	Amount of gain (loss) recognized in income
	2019			2018			OCI into income	2019		2018			in income	2019		2018
Derivatives designated as hedging instruments:
For the three months ended March 31,
Interest rate products	$	(3,785	)	$	8,100	(1)	Interest expense	$	1,880	$	339	(1)	Interest expense	$	—	$	—	(2)

(1)	Represents the effective portion of changes in fair value.

(2)	Represents the ineffective portion of changes in fair value.

	Location of gain (loss)	Amount of gain (loss) recognized in income
	recognized in income	2019			2018
Derivatives not designated as hedging instruments:
For the three months ended March 31,
Interest rate products	Interest expense	$	(26	)	$	10