Borrowing Arrangements

12 Months Ended

Dec. 31, 2021

Mortgage Notes Payable

Our mortgage notes payable is classified as Level 2 in the fair value hierarchy as of December 31, 2021 and 2020. The following table presents the fair value of our mortgage notes payable:


	As of December 31, 2021				As of December 31, 2020
(amounts in thousands)	Fair Value		Carrying Value		Fair Value		Carrying Value
Mortgage notes payable, excluding deferred financing costs	$	2,743,527	$	2,654,086	$	2,537,137	$	2,472,876

As of December 31, 2021 and 2020, we had outstanding mortgage indebtedness on Properties of approximately $2,627.8 million and $2,444.9 million, respectively, net of deferred financing costs. The weighted average interest rate on our outstanding mortgage indebtedness, including the impact of premium/discount amortization and loan cost amortization on mortgage indebtedness, as of December 31, 2021 and December 31, 2020, was approximately 3.8% and 4.1% per annum, respectively. The debt bears interest at stated rates ranging from 2.4% to 8.9% per annum and matures on various dates ranging from 2022 to 2041. The debt encumbered a total of 117 and 116 of our Properties as of December 31, 2021 and December 31, 2020, respectively and the gross carrying value of such Properties was approximately $2,817.5 million and $2,580.9 million, as of December 31, 2021 and December 31, 2020, respectively.

2021 Activity

During the quarter ended March 31, 2021, we entered into a $270.0 million secured financing transaction maturing in 10 years and bearing a fixed interest rate of 2.4% per annum. The loan is secured by two RV communities and one MH community. The net proceeds from the transaction were used to repay $67.0 million of principal on two mortgage loans that were due to mature in 2022, incurring $1.9 million of prepayment penalties, as well as to repay a portion of the outstanding balance on our line of credit. These mortgage loans had a weighted average interest rate of 5.1% per annum and were secured by two RV communities.

2020 Activity

We entered into two secured credit facilities with Fannie Mae, for total gross proceeds of $662.3 million. The average maturity for these credit facilities is 12 years and has a weighted average interest rate of 2.6%. The facilities were secured by 18 MH and four RV communities.

We also repaid $48.1 million of principal on three mortgage loans that were due to mature in 2020 and $166.8 million of principal on secured loans that were due to mature in 2021. The secured loans had a weighted average interest rate of approximately 5.1% per annum and were secured by 21 MH and three RV communities. As part of the repayment of the loans, we incurred early debt retirement costs of $9.0 million.

2019 Activity

We defeased mortgage debt of $11.2 million in conjunction with the disposition of the five all-age MH communities as disclosed in Note 6. Acquisitions. These loans had a weighted average interest rate of 5.0% per annum. We also assumed mortgage debt of $18.6 million, excluding mortgage note premium of $0.6 million, in connection with the acquisitions that were closed during the year ended December 31, 2019. These loans carry a weighted average interest rate of 5.4% per annum and mature between 2022 and 2024.

We also repaid $66.8 million of principal on four mortgage loans that were due to mature in 2020, incurring $1.4 million of prepayment penalties. These mortgage loans had a weighted average interest rate of 6.9% per annum and were secured by three MH and one RV communities.

Third Amended and Restated Unsecured Credit Facility

During the year ended December 31, 2021, we entered into a Third Amended and Restated Credit Agreement (the “Third Amended and Restated Credit Agreement”) by and among us, MHC Operating Limited Partnership, Wells Fargo Bank, National Association, as Administrative Agent (the “Administrative Agent”) and the other lenders named therein, pursuant to which we have access to a $500.0 million unsecured line of credit (the “LOC”) and a $300.0 million senior unsecured term loan (the “Term Loan”). We have the option to increase the borrowing capacity by $200.0 million, subject to certain conditions. The LOC maturity date was extended to April 18, 2025 and this term can be extended two times for additional six month increments, subject to certain conditions. The LOC bears interest at a rate of LIBOR plus 1.25% to 1.65% and requires an annual facility fee of 0.20% to 0.35%. The Term Loan matures on April 17, 2026 and has an interest rate of LIBOR plus 1.40% to 1.95% per annum. For both the LOC and Term Loan, the spread over LIBOR is variable based on leverage throughout the respective loan terms.

The Term Loan proceeds were used to repay the $300.0 million senior unsecured term loan agreement entered into during the first quarter of 2021.

Unsecured Debt

During the year ended December 31, 2021, we paid off and borrowed amounts on our LOC, leaving a balance of $349.0 million outstanding as of December 31, 2021. As of December 31, 2021, our LOC has a remaining borrowing capacity of $151.0 million with the option to increase the borrowing capacity by $200.0 million, subject to certain conditions. The LOC had a $222.0 million outstanding balance as of December 31, 2020.

Future Maturities of Debt

The following table presents the aggregate scheduled payments of principal on long-term borrowings for each of the next five years and thereafter as of December 31, 2021:


(amounts in thousands)	Amount
2022	$	133,565
2023	150,901
2024	70,184
2025	496,633
2026	362,451
Thereafter	2,089,011
Net unamortized premiums	341
Unamortized deferred financing costs	(28,867)
Total	$	3,274,219

As of December 31, 2021, we were in compliance in all material respects with the covenants in our borrowing arrangements.