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Notes and Bonds Payable
 6 Months Ended
Jun. 30, 2012
Debt Disclosure [Abstract]  
Notes and Bonds Payable
Notes and Bonds Payable
The table below details the Company’s notes and bonds payable as of June 30, 2012 and December 31, 2011.
(Dollars in thousands)
June 30, 2012
 
December 31, 2011
 
Maturity
Dates
 
Contractual
Interest Rates
 
Principal
Payments
 
Interest
Payments
Unsecured Credit Facility
$
216,000

 
$
212,000

 
10/15
 
LIBOR + 1.50%
 
At maturity
 
Quarterly
Senior Notes due 2014, net of discount
264,445

 
264,371

 
4/14
 
5.125%
 
At maturity
 
Semi-Annual
Senior Notes due 2017, net of discount
298,594

 
298,465

 
1/17
 
6.500%
 
At maturity
 
Semi-Annual
Senior Notes due 2021, net of discount
397,178

 
397,052

 
1/21
 
5.750%
 
At maturity
 
Semi-Annual
Mortgage notes payable, net of discount and including premiums
219,383

 
221,649

 
4/13-10/30
 
5.000%-7.625%
 
Monthly
 
Monthly
 
$
1,395,600

 
$
1,393,537

 
 
 
 
 
 
 
 


The Company’s various debt agreements contain certain representations, warranties, and financial and other covenants customary in such loan agreements. Among other things, these provisions require the Company to maintain certain financial ratios and minimum tangible net worth and impose certain limits on the Company’s ability to incur indebtedness and create liens or encumbrances. At June 30, 2012, the Company was in compliance with the financial covenant provisions under all of its various debt instruments.

Unsecured Credit Facility
On October 14, 2011, the Company entered into a $700.0 million unsecured credit facility due 2015 (the “Unsecured Credit Facility”) with a syndicate of 17 lenders that matures on October 14, 2015 with an option to extend the facility for one additional year for an extension fee of 0.20% of the aggregate commitments. Amounts outstanding under the Unsecured Credit Facility bear interest at LIBOR plus the applicable margin rate (defined as a range of 1.075% to 1.900% depending on the Company’s unsecured debt ratings, currently 1.5%). In addition, the Company pays a 0.35% facility fee per annum on the aggregate amount of commitments. The facility fee ranges from 0.175% per annum to 0.45% per annum, based on the Company’s unsecured debt ratings. At June 30, 2012, the Company had $216.0 million outstanding under the Unsecured Credit Facility with a weighted average interest rate of approximately 1.75% and a remaining borrowing capacity of approximately $484.0 million.

Senior Notes due 2014
On March 30, 2004, the Company issued $300.0 million of unsecured senior notes due 2014 (the “Senior Notes due 2014”). The Senior Notes due 2014 bear interest at 5.125% per annum, payable semi-annually on April 1 and October 1, and are due on April 1, 2014, unless redeemed earlier by the Company. The notes were issued at a discount of approximately $1.5 million, which yielded a 5.19% interest rate per annum upon issuance. In previous years, the Company repurchased approximately $35.3 million of the Senior Notes due 2014 and accreted a pro-rata portion of the discount upon the repurchases. The following table reconciles the balance of the Senior Notes due 2014 on the Company’s Condensed Consolidated Balance Sheets.
(Dollars in thousands)
June 30,
2012
 
December 31,
2011
Senior Notes due 2014 face value
$
264,737

 
$
264,737

Unaccreted discount
(292
)
 
(366
)
Senior Notes due 2014 carrying amount
$
264,445

 
$
264,371



Senior Notes due 2017
On December 4, 2009, the Company issued $300.0 million of unsecured senior notes due 2017 (the “Senior Notes due 2017”). The Senior Notes due 2017 bear interest at 6.50% per annum, payable semi-annually on January 17 and July 17, and are due on January 17, 2017, unless redeemed earlier by the Company. The notes were issued at a discount of approximately $2.0 million, which yielded a 6.618% interest rate per annum upon issuance. The following table reconciles the balance of the Senior Notes due 2017 on the Company’s Condensed Consolidated Balance Sheets.

(Dollars in thousands)
June 30,
2012
 
December 31,
2011
Senior Notes due 2017 face value
$
300,000

 
$
300,000

Unaccreted discount
(1,406
)
 
(1,535
)
Senior Notes due 2017 carrying amount
$
298,594

 
$
298,465



Senior Notes due 2021
On December 13, 2010, the Company issued $400.0 million of unsecured senior notes due 2021 (the “Senior Notes due 2021”). The Senior Notes due 2021 bear interest at 5.75% per annum, payable semi-annually on January 15 and July 15, beginning January 15, 2011, and are due on January 15, 2021, unless redeemed earlier by the Company. The notes were issued at a discount of approximately $3.2 million, which yielded a 5.855% interest rate per annum upon issuance. The following table reconciles the balance of the Senior Notes due 2021 on the Company’s Condensed Consolidated Balance Sheets.
(Dollars in thousands)
June 30,
2012
 
December 31,
2011
Senior Notes due 2021 face value
$
400,000

 
$
400,000

Unaccreted discount
(2,822
)
 
(2,948
)
Senior Notes due 2021 carrying amount
$
397,178

 
$
397,052



Mortgage Notes Payable
The following table reconciles the Company’s aggregate mortgage notes principal balance with the Company’s Condensed Consolidated Balance Sheets.
(Dollars in thousands)
June 30,
2012
 
December 31,
2011
Mortgage notes payable principal balance
$
222,941

 
$
225,377

Unaccreted discount, net of premium
(3,558
)
 
(3,728
)
Mortgage notes payable carrying amount
$
219,383

 
$
221,649



The following table further details the Company’s mortgage notes payable, with related collateral, at June 30, 2012.
 
 
 
Effective
 
 
 
 
 
 
 
Investment in
Collateral at
 
Balance at
(Dollars in millions)
Original
Balance
 
Interest
Rate (18)
 
Maturity
Date
 
Collateral(19)
 
Payments (14)
 
June 30, 2012
 
June 30, 2012
 
December 31, 2011
Life Insurance Co.
$
4.7

 
7.765
%
 
1/17
 
MOB
 
Monthly/20-yr amort.
 
$
11.7

 
$
1.8

 
$
1.9

Commercial Bank
1.8

 
5.550
%
 
10/30
 
OTH
 
Monthly/27-yr amort.
 
7.9

 
1.6

 
1.6

Life Insurance Co.
15.1

 
5.490
%
 
1/16
 
MOB
 
Monthly/10-yr amort.
 
32.7

 
12.9

 
13.1

Commercial Bank (1)
17.4

 
6.480
%
 
5/15
 
MOB
 
Monthly/10-yr amort.
 
19.9

 
14.6

 
14.5

Commercial Bank (2)
12.0

 
6.110
%
 
7/15
 
2 MOBs
 
Monthly/10-yr amort.
 
19.5

 
9.8

 
9.8

Commercial Bank (3)
15.2

 
7.650
%
 
7/20
 
MOB
 
(15)
 
20.2

 
12.8

 
12.8

Life Insurance Co. (4)
1.5

 
6.810
%
 
7/16
 
MOB
 
Monthly/9-yr amort.
 
2.1

 
1.1

 
1.1

Commercial Bank (5)
12.9

 
6.430
%
 
2/21
 
MOB
 
Monthly/12-yr amort.
 
20.6

 
11.3

 
11.4

Investment Fund
80.0

 
7.250
%
 
12/16
 
15 MOBs
 
Monthly/30-yr amort.(16)
 
155.0

 
78.0

 
78.4

Life Insurance Co.
7.0

 
5.530
%
 
1/18
 
MOB
 
Monthly/15-yr amort.
 
14.5

 
3.3

 
3.5

Investment Co. (6)
15.9

 
6.550
%
 
4/13
 
MOB
 
Monthly/30-yr amort.(17)
 
23.3

 
15.0

 
15.2

Investment Co.
4.6

 
5.250
%
 
9/15
 
MOB
 
Monthly/10-yr amort.
 
6.9

 
4.3

 
4.3

Life Insurance Co. (7)
13.9

 
4.700
%
 
1/16
 
MOB
 
Monthly/25-yr amort.
 
26.4

 
12.1

 
12.4

Life Insurance Co. (8)
21.5

 
4.700
%
 
8/15
 
MOB
 
Monthly/25-yr amort.
 
43.8

 
18.5

 
18.8

Insurance Co. (9)
7.3

 
5.100
%
 
12/18
 
MOB
 
Monthly/25-yr amort.
 
14.6

 
7.4

 
7.5

Commercial Bank (10)
8.1

 
4.540
%
 
8/16
 
MOB
 
Monthly/10-yr amort.
 
15.1

 
7.6

 
7.7

Life Insurance Co. (11) (12)
5.3

 
4.060
%
 
11/14
 
MOB
 
Monthly/25-yr amort.
 
11.6

 
4.6

 
4.8

Life Insurance Co. (13)
3.1

 
4.060
%
 
11/14
 
MOB
 
Monthly/25-yr amort.
 
6.7

 
2.7

 
2.8

 
 
 
 
 
 
 
 
 
 
 
$
452.5

 
$
219.4

 
$
221.6

_______________
(1) The unaccreted portion of a $2.7 million discount recorded on this note upon acquisition is included in the balance above.
(2) The unaccreted portion of a $2.1 million discount recorded on this note upon acquisition is included in the balance above.
(3) The unaccreted portion of a $2.4 million discount recorded on this note upon acquisition is included in the balance above.
(4) The unaccreted portion of a $0.2 million discount recorded on this note upon acquisition is included in the balance above.
(5) The unaccreted portion of a $1.0 million discount recorded on this note upon acquisition is included in the balance above.
(6) The unamortized portion of a $0.5 million premium recorded on this note upon acquisition is included in the balance above.
(7) The unamortized portion of a $0.3 million premium recorded on this note upon acquisition is included in the balance above.
(8) The unamortized portion of a $0.4 million premium recorded on this note upon acquisition is included in the balance above.
(9) The unamortized portion of a $0.6 million premium recorded on this note upon acquisition is included in the balance above.
(10) The unamortized portion of a $0.2 million premium recorded on this note upon acquisition is included in the balance above.
(11) The balance consists of two notes secured by the same building.
(12) The unamortized portions of a $0.3 million premium recorded on these notes upon acquisition are included in the balance above.
(13) The unamortized portion of a $0.2 million premium recorded on this note upon acquisition is included in the balance above.
(14) Payable in monthly installments of principal and interest with the final payment due at maturity (unless otherwise noted).
(15) Payable in monthly installments of interest only for 24 months and then installments of principal and interest based on an 11-year amortization with the final payment due at maturity.
(16) The Company has the option to extend the maturity for two, one-year floating rate extension terms.
(17) The Company has the option to extend the maturity for three years at a fixed rate of 6.75%.
(18) The contractual interest rates for the 19 outstanding mortgage notes ranged from 5.00% to 7.625% at June 30, 2012.
(19) MOB-Medical office building; OTH-Other.

Long-Term Debt Maturities
Future contractual maturities of the Company’s notes and bonds payable as of June 30, 2012 were:
(Dollars in thousands)
Principal
Maturities
 
Net Accretion/
Amortization (1)
 
Notes and
Bonds Payable
 
%
2012 (remaining)
$
2,512

 
$
(520
)
 
$
1,992

 
0.1
%
2013
19,781

 
(1,263
)
 
18,518

 
1.3
%
2014
276,349

 
(1,404
)
 
274,945

 
19.7
%
2015
265,775

 
(1,215
)
 
264,560

 
19.0
%
2016
106,376

 
(907
)
 
105,469

 
7.6
%
2017 and thereafter
732,885

 
(2,769
)
 
730,116

 
52.3
%
 
$
1,403,678

 
$
(8,078
)
 
$
1,395,600

 
100.0
%
_______________
(1) Includes discount accretion and premium amortization related to the Company’s Senior Notes due 2014, Senior Notes due 2017, Senior Notes due 2021 and 13 mortgage notes payable.