Derivative Instruments

9 Months Ended

Sep. 30, 2025

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative Instruments

We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate risk, primarily by managing the amount, sources, and duration of our investments, borrowings, and the use of derivative financial instruments. Specifically, we use derivative financial instruments to manage exposures that arise from business activities that result in the payment of future known and uncertain cash amounts, the value of which are determined by interest rates. Our derivative financial instruments are used to manage differences in the amount, timing, and duration of our known or expected cash payments principally related to our borrowings.

The following table summarizes changes to the notional amount of our derivative instruments in for the nine months ended September 30, 2025:

in thousands	Notional Amount as of December 31, 2024		Additions		Termination or Expiration		Notional Amount as of September 30, 2025
Interest rate caps	$	153,500	$	—	$	(153,500)	$	—
Interest rate swaps	52,500		142,900		—		195,400
Total	$	206,000	$	142,900	$	(153,500)	$	195,400

The following tables summarize the notional amount and other information related to our interest rate caps and interest rate swap as of September 30, 2025 and December 31, 2024:

	September 30, 2025
in thousands	Number of Instruments	Notional Amount(1)		Fixed Amount		Fair Value		Weighted Average Strike Rate/Fixed Rate	Weighted Average Remaining Term In Years
Assets(2)
Interest rate swap	1	52,500		N/A		554		2.73%	1.58
Total assets	1	$	52,500	$	—	$	554
Liabilities(3)
Interest rate swaps	2	$	142,900	N/A		$	493	3.86%	1.06
Total liabilities	2	$	142,900	$	—	$	493

	December 31, 2024
in thousands	Number of Instruments	Notional Amount(1)		Fixed Amount		Fair Value		Weighted Average Strike Rate/Fixed Rate	Weighted Average Remaining Term In Years
Assets(2)
Interest rate caps	3	$	153,500	$	2,108	$	237	3.08%	0.22
Interest rate swap	1	52,500		N/A		1,496		2.73%	2.32
Total	4	$	206,000	$	2,108	$	1,733

(1)The notional amount represents the amount of the mortgage note borrowings that we are hedging. It does not represent our exposure to credit, interest rate or market risks.

(2)Derivative assets are included as a component of other assets on our condensed consolidated balance sheets.

(3)Derivative liabilities are included as a component of accounts payable, accrued expenses and other liabilities on our condensed consolidated balance sheets.

The following tables summarize the effect of interest rate caps and interest rate swaps reported in gain (loss) on derivative instruments, net on the condensed consolidated statements of operations for the three months ended September 30, 2025 and 2024:

	Three Months Ended September 30, 2025
in thousands	Realized gain (loss) on derivative instruments, net		Contractual net interest income (expense)		Unrealized gain (loss), net		Gain (loss) on derivative instruments, net
Interest rate cap	$	(29)	$	113	$	7	$	91
Interest rate swaps	—		286		(195)		91
Total	$	(29)	$	399	$	(188)	$	182

	Three Months Ended September 30, 2024
in thousands	Realized gain (loss) on derivative instruments, net		Contractual net interest income (expense)		Unrealized gain (loss), net		Gain (loss) on derivative instruments, net
Interest rate caps	$	(176)	$	887	$	(1,026)	$	(315)
Interest rate swap	—		351		(1,418)		(1,067)
Total	$	(176)	$	1,238	$	(2,444)	$	(1,382)

The following tables summarize the effect of interest rate caps and interest rate swaps reported in gain (loss) on derivative instruments, net on the condensed consolidated statements of operations for the nine months ended September 30, 2025 and 2024:

	Nine Months Ended September 30, 2025
in thousands	Realized gain (loss) on derivative instruments, net		Contractual net interest income (expense)		Unrealized gain (loss), net		Gain (loss) on derivative instruments, net
Interest rate cap	$	(29)	$	251	$	(461)	$	(239)
Interest rate swaps	—		757		(973)		(216)
Total	$	(29)	$	1,008	$	(1,434)	$	(455)

	Nine Months Ended September 30, 2024
in thousands	Realized gain (loss) on derivative instruments, net		Contractual net interest income (expense)		Unrealized gain (loss), net		Gain (loss) on derivative instruments, net
Interest rate caps	$	(122)	$	2,796	$	(2,092)	$	582
Interest rate swap	—		1,046		(740)		306
Total	$	(122)	$	3,842	$	(2,832)	$	888