INDEBTEDNESS

Overview

Indebtedness consists of mortgage loans, unsecured notes, and borrowings under a credit facility. The weighted average interest rates for the years ended December 31, 2015, 2014 and 2013 were 4.6%, 5.0% and 5.1%, respectively. Interest costs during the years ended December 31, 2015, 2014 and 2013 in the amount of $16.7 million, $13.2 million and $9.6 million, respectively, were capitalized. Cash paid for interest for the years ended December 31, 2015, 2014 and 2013 was $149.6 million, $164.9 million and $143.2 million, respectively.

The Company is subject to financial covenants contained in some of its debt agreements, the most restrictive of which are detailed below under the heading "Credit Facility." As of December 31, 2015, the Company was in compliance with all financial and non-financial covenants.

The scheduled principal amortization and maturities of the Company's mortgage loans, unsecured notes outstanding and the Credit Facility (as defined below) and the related weighted average interest rates at December 31, 2015 are as follows (in thousands, except percentages):



													Weighted
	Mortgages												Average
	Principal		Principal		Unsecured			Credit					Interest
	Amortization		Maturities		Notes			Facility		Total			Rate
2016	$	9,518	$	16,880	$	300,000		$	—	$	326,398		5.53	%
2017	8,688		2,349		296,543			—		307,580			6.57	%
2018	6,470		27,102		100,000			259,000		392,572			3.26	%
2019	6,666		50,043		—			—		56,709			4.00	%
2020	3,351		67,370		350,000			—		420,721			4.82	%
2021	2,326		65,091		—			—		67,417			4.06	%
2022	2,172		—		400,000			—		402,172			4.13	%
2023	2,281		—		300,000			—		302,281			3.39	%
2024	2,385		—		450,000			—		452,385			4.40	%
2025 and thereafter	24,806		1,946		400,000			—		426,752			3.81	%
Subtotal	$	68,663	$	230,781	$	2,596,543		$	259,000	$	3,154,987		4.42	%
Reconciling items ⁽¹⁾	8,464		—		(16,435		)	—		(7,971		)
Total for consolidated balance sheet	$	77,127	$	230,781	$	2,580,108		$	259,000	$	3,147,016


(1)	Includes deferred financing costs, premium/discount and market adjustments.

Mortgage Loans and Unsecured Notes

Mortgage loans with maturities ranging from 2016 to 2033 were collateralized by and in some instances cross-collateralized by properties with a net book value of $603.5 million as of December 31, 2015.

The interest rates on $2,896.0 million of mortgage loans (including $101.4 million fixed via a swap arrangement - see Footnote 21 - Derivative Instruments) and unsecured notes are fixed and range from 3.0% to 7.5%. The weighted average remaining term for the mortgage loans and unsecured notes is 5.7 years.

Credit Facility

The Company has maintained an unsecured credit facility throughout 2013, 2014 and 2015. During that period the Company has replaced, restated and amended its credit facility. This activity has resulted in changes to borrowing capacity, due dates, borrowing costs and covenant calculations. As replaced, restated and amended these credit facilities are referred to below as the "Credit Facility." The interest rate on borrowings under the Credit Facility fluctuates based upon ratings from Moody’s Investors Service, Inc., Standard and Poor’s Ratings Group and Fitch, Inc. Based on the Company's ratings as of December 31, 2015, borrowings under the Credit Facility bear interest at LIBOR plus 105 basis points. There is also a 20 basis point annual facility fee on the current borrowing capacity. The Credit Facility expires in March 2018 and has two six-month extensions at the Company's option, subject to the payment of a stated fee. The Credit Facility contains a competitive bid option, whereby participating lenders bid on the interest rate to be charged. This feature is available for up to 50% of the amount of the facility. There were $259.0 million of borrowings outstanding under the Credit Facility at December 31, 2015. The total borrowing capacity for the Credit Facility is $800 million and there is an accordion feature for an additional $400 million. The Credit Facility contains financial covenants, certain of which are set forth below:


•	total debt to total assets may not exceed 0.60:1;


•	earnings before interest, taxes, depreciation and amortization to fixed charges may not be less than 1.50:1;


•	unsecured debt to unencumbered asset value must equal or be less than 60%; and


•	unencumbered net operating income to unsecured interest expense must equal or exceed 175%.

Activity

In March 2014, the Company replaced its existing $500 million Credit Facility with an $800 million Credit Facility.

In August 2014, the Company used proceeds from its Credit Facility together with available cash on hand to repay its 5.65% senior unsecured notes due August 2014 in the amount of $200 million.

In March 2015, the Company used proceeds from its Credit Facility together with available cash on hand to repay its $300 million 5.125% senior unsecured notes due March 2015.

In March 2015, the Company issued $400 million of 3.75% senior unsecured notes due 2025. The net proceeds from this issuance were used to repay borrowings under the Company's Credit Facility and for general corporate purposes.

In August 2015, the Company used proceeds from its Credit Facility to prepay in full without penalty a $105.8 million 7.0% mortgage loan due February 2016.

In December 2015, the Company used proceeds from its Credit Facility to prepay in full without penalty a $59.7 million 7.5% mortgage loan due March 2016.

In December 2015, the Company used proceeds from its Credit Facility to satisfy $16.0 million in unsecured notes bearing interest at 3.4% due December 2015.