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Notes and Bonds Payable
 12 Months Ended
Dec. 31, 2016
Debt Disclosure [Abstract]  
Notes and Bonds Payable
Notes and Bonds Payable
The table below details the Company’s notes and bonds payable.  The Company adopted ASU No. 2015-03, "Simplifying the Presentation of Debt Issuance Costs" as of January 1, 2016. The balances the year ending December 31, 2015 shown below reflect the required reclassification of debt issuance costs. See Note 1 to the Consolidated Financial Statements for more information.
 
December 31,
Maturity
Dates
 
Contractual
Interest Rates

 
Principal
Payments
 
Interest
Payments
(Dollars in thousands)
2016

 
2015

 
 
Unsecured Credit Facility
$
107,000

 
$
206,000

7/20
 
LIBOR + 1.00%

 
At maturity
 
Quarterly
Unsecured Term Loan due 2019, net of issuance costs
149,491

 
199,257

2/19
 
LIBOR + 1.20%

 
At maturity
 
Quarterly
Senior Notes due 2021, net of discount and issuance costs
397,147

 
396,489

1/21
 
5.75
%
 
At maturity
 
Semi-Annual
Senior Notes due 2023, net of discount and issuance costs
247,296

 
246,897

4/23
 
3.75
%
 
At maturity
 
Semi-Annual
Senior Notes due 2025, net of discount and issuance costs
247,819

 
247,602

5/25
 
3.88
%
 
At maturity
 
Semi-Annual
Mortgage notes payable, net of discounts and issuance costs and including premiums
115,617

 
128,747

5/17-5/40
 
     3.60%-6.88%

 
Monthly
 
Monthly

$
1,264,370

 
$
1,424,992

 
 
 
 
 
 
 

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 impose certain limits on the Company’s ability to incur indebtedness and create liens or encumbrances. As of December 31, 2016, the Company was in compliance with its financial covenant provisions under its various debt instruments.
Unsecured Credit Facility due 2020
On October 14, 2011, the Company entered into a $700.0 million unsecured credit facility ("Unsecured Credit Facility") with a syndicate of 17 lenders. On July 29, 2016, the Company entered into the third amendment to the Unsecured Credit Facility with a syndicate of 14 lenders to extend the maturity date to July 2020. The credit facility agreement provides the Company with two six-month extension options that could extend the maturity date to July 2021. Each option is subject to an extension fee of 0.075% of the aggregate commitments. Amounts outstanding under the Unsecured Credit Facility bear interest at LIBOR plus an applicable margin rate. The margin rate, which depends on the Company's credit ratings, ranges from 0.83% to 1.55% (1.00% as of December 31, 2016). In addition, the Company pays a facility fee per annum on the aggregate amount of commitments ranging from 0.13% to 0.30% (0.20% as of December 31, 2016). In connection with the amendment, the Company paid up-front fees to the lenders of approximately $4.4 million, which will be amortized over the term of the facility. The Company wrote-off certain unamortized deferred financing costs of the original facility of approximately $0.1 million upon execution of the amendment. As of December 31, 2016, the Company had $107.0 million outstanding under the Unsecured Credit Facility with an effective interest rate of approximately 1.8% and had a remaining borrowing capacity of approximately $593.0 million.
Unsecured Term Loan due 2019
In February 2014, the Company entered into a $200.0 million unsecured term loan facility ("Unsecured Term Loan due 2019") with a syndicate of nine lenders that matures on February 26, 2019. The Unsecured Term Loan due 2019 bears interest at a rate equal to (x) LIBOR plus (y) a margin ranging from 1.00% to 1.95% (1.20% as of December 31, 2016) based upon the Company's unsecured debt ratings. Payments under the Unsecured Term Loan due 2019 are interest only, with the full amount of the principal due at maturity. The Unsecured Term Loan due 2019 may be prepaid at any time, without penalty. The proceeds from the Unsecured Term Loan due 2019 were used by the Company to repay borrowings on its Unsecured Credit Facility. The Unsecured Term Loan due 2019 has various financial covenant provisions that are required to be met on a quarterly and annual basis that are equivalent to those of the Unsecured Credit Facility. With proceeds of the equity offering that the Company completed on July 5, 2016, the Company repaid $50.0 million of the Unsecured Term Loan due 2019 leaving an outstanding balance of $150.0 million as of December 31, 2016 with an effective interest rate of approximately 1.8%.
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") in a registered public offering. The Senior Notes due 2021 bear interest at 5.75%, payable semi-annually on January 15 and July 15, 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 and the Company incurred $3.3 million in debt issuance costs, which yielded a 5.97% interest rate per annum upon issuance. For each of the years ended December 31, 2016, 2015 and 2014, the Company amortized approximately $0.3 million of the discount and $0.3 million of the debt issuance costs which are included in interest expense on the Company’s Consolidated Statements of Income. The following table reconciles the balance of the Senior Notes due 2021 on the Company’s Consolidated Balance Sheets as of December 31, 2016 and 2015:  
 
December 31,
(Dollars in thousands)
2016

 
2015

Senior Notes due 2021 face value
$
400,000

 
$
400,000

Unaccreted discount
(1,510
)
 
(1,832
)
          Issuance costs
(1,343
)
 
(1,679
)
Senior Notes due 2021 carrying amount
$
397,147

 
$
396,489


Senior Notes due 2023
On March 26, 2013, the Company issued $250.0 million of unsecured senior notes due 2023 (the "Senior Notes due 2023") in a registered public offering. The Senior Notes due 2023 bear interest at 3.75%, payable semi-annually on April 15 and October 15, beginning October 15, 2013, and are due on April 15, 2023, unless redeemed earlier by the Company. The notes were issued at a discount of approximately $2.1 million and the Company incurred debt issuance cost of $2.1 million, which yielded a 3.95% interest rate per annum upon issuance. For each of the years ended December 31, 2016, 2015 and 2014, the Company amortized approximately $0.2 million of the discount and $0.2 million of the debt issuance cost which are included in interest expense on the Company’s Consolidated Statements of Income. The following table reconciles the balance of the Senior Notes due 2023 on the Company’s Consolidated Balance Sheets as of December 31, 2016 and 2015:  
 
December 31,
(Dollars in thousands)
2016

 
2015

Senior Notes due 2023 face value
$
250,000

 
$
250,000

Unaccreted discount
(1,375
)
 
(1,565
)
          Issuance costs
(1,329
)
 
(1,538
)
Senior Notes due 2023 carrying amount
$
247,296

 
$
246,897


Senior Notes due 2025
On April 24, 2015, the Company issued $250.0 million of unsecured senior notes due 2025 (the "Senior Notes due 2025") in a registered public offering. The Senior Notes due 2025 bear interest at 3.875%, payable semi-annually on May 1 and November 1, beginning November 1, 2015, and are due on May 1, 2025, unless redeemed earlier by the Company. The notes were issued at a discount of approximately $0.2 million and the Company incurred approximately $2.3 million in debt issuance costs which yielded a 4.08% interest rate per annum upon issuance. For the years ended December 31, 2016 and 2015, the Company amortized approximately $0.2 million and $0.1 million, respectively, of the debt issuance costs which is included in interest expense on the Company's Consolidated Statements of Income. Concurrent with this transaction, the Company settled four forward starting swap agreements for $1.7 million. The Senior Notes due 2025 have various financial covenants that are required to be met on a quarterly and annual basis. The following table reconciles the balance of the Senior Notes due 2025 on the Company’s Consolidated Balance Sheets as of December 31, 2016 and 2015:
 
 
December 31,
(Dollars in thousands)
2016

 
2015

Senior Notes due 2025 face value
$
250,000

 
$
250,000

Unaccreted discount
(178
)
 
(196
)
          Issuance costs
(2,003
)
 
(2,202
)
Senior Notes due 2025 carrying amount
$
247,819

 
$
247,602


Mortgage Notes Payable
The following table reconciles the Company’s aggregate mortgage notes principal balance with the Company’s Consolidated Balance Sheets as of December 31, 2016 and 2015. For the years ended December 31, 2016, 2015 and 2014, the Company amortized approximately $0.3 million, $0.8 million and $1.1 million of the discount and $0.9 million, $1.0 million, and $1.0 million of the premium. For the years ended December 31, 2016, 2015 and 2014, the Company also amortized approximately $0.2 million, $0.2 million, and $0.2 million of the debt issuance costs, respectively, on the mortgage notes payable which is included in interest expense on the Company’s Consolidated Statements of Income.
 
December 31,
(Dollars in thousands)
2016

 
2015

Mortgage notes payable principal balance
$
114,934

 
$
128,161

Unamortized premium
2,569

 
2,704

Unaccreted discount
(1,450
)
 
(1,779
)
          Issuance costs
(436
)
 
(339
)
Mortgage notes payable carrying amount
$
115,617

 
$
128,747


The following table details the Company’s mortgage notes payable, with related collateral.
 
Original Balance

 
Effective Interest Rate (20)

 
Maturity
Date
 
Collateral (21)
 
Principal and Interest Payments (19)

 
Investment in Collateral at December 31,

 
Balance at December 31,
(Dollars in millions)
 
 
 
 
 
2016

 
2016

 
2015

Commercial Bank (1)
$
13.1

 
5.00
%
 
4/16
 
MOB
 
Monthly/25-yr amort.

 
$
—

 
$
—

 
$
10.2

Commercial Bank (2)
8.1

 
4.54
%
 
8/16
 
MOB
 
Monthly/10-yr amort.

 
—

 
—

 
7.4

Commercial Bank (3)
18.3

 
5.40
%
 
12/16
 
MOB
 
Monthly/30-yr amort.

 
—

 
—

 
16.0

Life Insurance Co. (4)
4.7

 
7.77
%
 
1/17
 
MOB
 
Monthly/20-yr amort.

 
—

 
—

 
0.4

Life Insurance Co. 
7.0

 
5.53
%
 
1/18
 
MOB
 
Monthly/15-yr amort.

 
14.3

 
0.7

 
1.4

Insurance Co. (5)
7.3

 
5.54
%
 
12/18
 
MOB
 
Monthly/25-yr amort.

 
14.2

 
6.2

 
6.5

Commercial Bank (6)
9.5

 
5.07
%
 
3/19
 
MOB
 
Monthly/5-yr amort.

 
13.9

 
9.5

 
9.7

Commercial Bank (7)
9.4

 
4.55
%
 
7/19
 
MOB
 
Monthly/8-yr amort

 
27.8

 
9.3

 
9.5

Commercial Bank (8)
15.2

 
7.65
%
 
7/20
 
MOB
 
(18
)
 
20.2

 
12.7

 
12.7

Life Insurance Co. (9)
7.9

 
4.00
%
 
8/20
 
MOB
 
Monthly/15-yr amort.

 
20.7

 
2.7

 
3.3

Life Insurance Co. (10)
7.3

 
5.25
%
 
8/20
 
MOB
 
Monthly/27-yr amort.

 
17.9

 
6.7

 
6.9

Commercial Bank (11)
12.9

 
6.43
%
 
2/21
 
MOB
 
Monthly/12-yr amort.

 
19.9

 
10.7

 
10.8

Life Insurance Co. (12)
13.3

 
4.13
%
 
1/24
 
MOB
 
Monthly/10-yr amort.

 
20.5

 
13.6

 
—

Financial Services (13)
9.7

 
4.32
%
 
9/24
 
MOB
 
Monthly/10-yr amort.

 
16.1

 
9.1

 
9.3

First Tennessee Bank
11.5

 
3.71
%
 
1/26
 
MOB
 
Monthly/10-yr amort.

 
37.3

 
11.0

 
—

Commercial Bank (14)
15.0

 
5.25
%
 
4/27
 
MOB
 
Monthly/20-yr amort.

 
33.4

 
10.4

 
11.1

Commercial Bank
1.8

 
5.55
%
 
10/30
 
OTH
 
Monthly/27-yr amort.

 
7.9

 
1.3

 
1.4

Municipal Government (15) (16)
11.9

 
4.79
%
 
(17) 
 
MOB
 
Semi-Annual (17)

 
20.9

 
11.7

 
12.1

 
 
 
 
 
 
 
 
 
 
 
$
285.0

 
$
115.6

 
$
128.7

______ 
(1)
The Company repaid this mortgage note in February 2016.
(2)
The Company repaid this mortgage note in April 2016.
(3)
The Company repaid this mortgage note in September 2016.
(4)
The Company repaid this mortgage note in October 2016.
(5)
The unamortized portion of the $0.6 million premium recorded on this note upon acquisition is included in the balance above.
(6)
The unamortized portion of the $0.2 million premium recorded on this note upon acquisition is included in the balance above.
(7)
The unamortized portion of the $0.3 million premium recorded on this note upon acquisition is included in the balance above.
(8)
The unaccreted portion of the $2.4 million discount recorded on this note upon acquisition is included in the balance above.
(9)
The unamortized portion of the $0.3 million premium recorded on this note upon acquisition is included in the balance above.
(10)
The unamortized portion of the $0.4 million premium recorded on this note upon acquisition is included in the balance above.
(11)
The unaccreted portion of a $1.0 million discount recorded on this note upon acquisition is included in the balance above.
(12)
The unamortized portion of the $0.8 million premium recorded on this note upon acquisition is included in the balance above.
(13)
The unaccreted portion of the $0.1 million premium recorded on this note upon acquisition is included in the balance above.
(14)
The unamortized portion of a $0.7 million premium recorded on this note upon acquisition is included in the balance above.
(15)
Balance consists of four notes secured by the same building.
(16)
The unamortized portion of the $1.0 million premium recorded on the four notes upon acquisition is included in the balance above.
(17)
These four mortgage notes payable are series municipal bonds that have maturity dates ranging from from May 2017 to May 2040. The note payable with the earliest maturity date will require principal and interest payments while the remaining notes payable will require interest only payments. One of the notes payable matures in May 2017 and the remaining three have future maturity dates but allow repayment after May 2020 without penalty. The Company intends on repaying all three notes payable at that time.
(18)
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.
(19)
Payable in monthly installments of principal and interest with the final payment due at maturity (unless otherwise noted).
(20)
The contractual interest rates for the 17 outstanding mortgage notes ranged from 3.6% to 6.9% as of December 31, 2016.
(21)
MOB-Medical office building; OTH-Other.






Other Long-Term Debt Information
Future maturities of the Company’s notes and bonds payable as of December 31, 2016 were as follows: 
(Dollars in thousands)
Principal
Maturities

 
Net Accretion/
Amortization (1)

 
Debt Issuance Costs

 
Notes and Bonds Payable

%

2017
$
4,374

 
$
(233
)
 
$
(1,086
)
 
3,055

0.2
%
2018
9,649

 
(295
)
 
(1,089
)
 
8,265

0.7
%
2019
171,643

 
(514
)
 
(876
)
 
170,253

13.5
%
2020
128,692

 
(683
)
 
(825
)
 
127,184

10.1
%
2021
412,149

 
(144
)
 
(490
)
 
411,515

32.5
%
2022 and thereafter
545,427

 
(75
)
 
(1,254
)
 
544,098

43.0
%
 
$
1,271,934

 
$
(1,944
)
 
$
(5,620
)
 
1,264,370

100.0
%
______ 
(1)
Includes discount accretion and premium amortization related to the Company’s Senior Notes due 2021, Senior Notes due 2023, Senior Notes due 2025, and 14 mortgage notes payable.