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Derivative Financial Instruments
 9 Months Ended
Sep. 30, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Derivative Financial Instruments
Certain of the Company’s financing transactions expose the Company to interest rate risks, which include exposure to variable interest rates on certain unsecured loans and loans secured by the Company’s real estate. The Company uses derivative financial instruments to minimize the risks and/or costs associated with the Company’s financing and to limit the Company’s exposure to the future variability of interest rates. To mitigate this risk, the Company enters into derivative financial instruments with counterparties it believes to have appropriate credit ratings and that are major financial institutions with which the Company and its affiliates may also have other financial relationships.
The Company’s objective in using interest rate derivatives is to add stability to interest expense and to manage our exposure to interest rate fluctuations. To accomplish this objective, we use interest rate swap and interest rate cap contracts to manage our exposure on the variable rate interest debt. The Company has designated its derivative financial instruments as cash flow hedges as defined under GAAP as of September 30, 2023.
Changes in the fair value of cash flow hedges are recorded in accumulated other comprehensive income and subsequently reclassified into earnings in the period that the hedged transaction affects earnings. Amounts reported in accumulated other comprehensive income for our interest rate swap and interest rate caps will be reclassified to interest expense as interest payments are made on the Company’s mortgages and term loan credit facility. Refer to Note 2 - Summary of Significant Accounting Policies and Estimates for additional detail.
The following table details the Company’s outstanding interest rate derivative that is designated as a cash flow hedge of interest rate risk:
Notional Amount
Financial InstrumentsMaturity DateSeptember 30, 2023December 31, 2022
Interest rate swap8/11/2027$950,000 $700,000 
Interest rate swap1/6/202845,085 — 
Interest rate cap9/15/2024221,405 221,405 
Interest rate cap9/9/2024297,596 347,438 
$1,514,086 $1,268,843 
The fair value of our derivative financial instruments as well as their classification on our Condensed Consolidated Balance Sheet as of September 30, 2023 is detailed below.
Fair Value
Balance Sheet
Location		September 30, 2023December 31, 2022
Derivative Assets:
Derivative instruments designated as hedging instruments - interest rate swapOther Assets$28,956 $4,379 
Derivative instruments designated as hedging instruments - interest rate capsOther Assets11,369 7,387 
Total$40,325 $11,766 
The following table details the effect of the Company’s derivative financial instrument on the Condensed Consolidated Statement of Operations during the three months ended September 30, 2023:
Amount of
Unrealized Gain
(Loss) Recognized
in OCI		Location of Gain
(Loss) Recognized in
Income on Derivatives		Amount of Gain (Loss)
Reclassified from
Accumulated OCI into Income
September 30, 2023September 30, 2023
Interest rate swap$11,179 Interest Expense$3,909 
Interest rate caps(38)Interest Expense3,435 
Total$11,141 $7,344 
The following table details the effect of the Company’s derivative financial instrument on the Condensed Consolidated Statement of Operations during the nine months ended September 30, 2023:
Amount of
Unrealized Gain
(Loss) Recognized
in OCI		Location of Gain
(Loss) Recognized in
Income on Derivatives		Amount of Gain (Loss)
Reclassified from
Accumulated OCI into Income
September 30, 2023September 30, 2023
Interest rate swap$24,599 Interest Expense$9,226 
Interest rate caps143 Interest Expense8,701 
Total$24,742 $17,927 
For the period from Inception through September 30, 2022, the amount of unrealized gain recognized in OCI on interest rate swaps was $5,981, with $— reclassified from Accumulated Other Comprehensive Income into Income.