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Debt

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

9.

Debt

EQR does not have any indebtedness as all debt is incurred by the Operating Partnership. EQR guarantees the Operating Partnership’s revolving credit facility up to the maximum amount and for the full term of the facility. Weighted average interest rates noted below for the quarter ended March 31, 2019 include the effect of any derivative instruments and amortization of premiums/discounts/OCI (other comprehensive income) on debt and derivatives.

Mortgage Notes Payable

As of March 31, 2019, the Company had outstanding mortgage debt of approximately $2.7 billion.

During the quarter ended March 31, 2019, the Company obtained $288.1 million in 3.94% fixed rate mortgage debt held in a Fannie Mae loan pool maturing on March 1, 2029.

As of March 31, 2019, the Company had $440.6 million of secured debt (primarily tax-exempt bonds) subject to third party credit enhancement.

As of March 31, 2019, scheduled maturities for the Company’s outstanding mortgage indebtedness were at various dates through May 28, 2061. At March 31, 2019, the interest rate range on the Company’s mortgage debt was 0.10% to 6.90%. During the quarter ended March 31, 2019, the weighted average interest rate on the Company’s mortgage debt was 4.01%.

Notes

As of March 31, 2019, the Company had outstanding unsecured notes of approximately $5.9 billion.

As of March 31, 2019, scheduled maturities for the Company’s outstanding notes were at various dates through August 1, 2047. At March 31, 2019, the interest rate range on the Company’s notes before the effect of certain fair value hedges was 2.375% to 7.57%. During the quarter ended March 31, 2019, the weighted average interest rate on the Company’s notes was 4.32%.

The Company’s unsecured public debt contains certain financial and operating covenants including, among other things, maintenance of certain financial ratios. The Company was in compliance with its unsecured public debt covenants for the quarter ended March 31, 2019.

Line of Credit and Commercial Paper

In November 2016, the Company replaced its existing $2.5 billion facility with a $2.0 billion unsecured revolving credit facility maturing January 10, 2022. The Company has the ability to increase available borrowings by an additional $750.0 million by adding additional banks to the facility or obtaining the agreement of existing banks to increase their commitments. The interest rate on advances under the facility will generally be LIBOR plus a spread (currently 0.825%), or based on bids received from the lending group, and the Company pays an annual facility fee (currently 0.125%). Both the spread and the facility fee are dependent on the Company’s senior unsecured credit rating.

In February 2015, the Company entered into an unsecured commercial paper note program in the United States. The Company may borrow up to a maximum of $500.0 million under this program subject to market conditions. The notes will be sold under customary terms in the United States commercial paper note market and will rank pari passu with all of the Company’s other unsecured senior indebtedness. As of March 31, 2019, there was a balance of $344.8 million outstanding on the commercial paper program ($345.0 million in principal outstanding net of an unamortized discount of $0.2 million). The notes bear interest at various floating rates with a weighted average of 2.75% for the quarter ended March 31, 2019 and a weighted average maturity of 7 days as of March 31, 2019.

As of March 31, 2019, there were no borrowings outstanding under the revolving credit facility and $6.7 million was restricted/dedicated to support letters of credit. In addition, the Company limits its utilization of the facility in order to maintain liquidity and to support its $500.0 million commercial paper program along with certain other obligations. As a result, the Company had approximately $1.55 billion available under the facility at March 31, 2019. During the quarter ended March 31, 2019, the weighted average interest rate on the revolving credit facility was 3.25%.

Other

In 2017, the Company executed a letter of credit facility with a third party financial institution which is not backed or collateralized by borrowings on the Company’s unsecured revolving credit facility. As of March 31, 2019, there was $9.0 million in letters of credit outstanding on this facility.