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, 2014, 2013 and 2012 were 5.0%, 5.1% and 5.3%, respectively. Interest costs during the years ended December 31, 2014, 2013 and 2012 in the amount of $13.2 million, $9.6 million and $9.9 million, respectively, were capitalized. Cash paid for interest for the years ended December 31, 2014, 2013 and 2012 was $164.9 million, $143.2 million and $132.2 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, 2014, 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, 2014 are as follows (in thousands, except percentages):



											Weighted
	Mortgages										Average
	Principal		Principal		Unsecured		Credit				Interest
	Amortization		Maturities		Notes		Facility		Total		Rate

2015	$	12,194	$	—	$	315,981	$	—	$	328,175	5.04	%
2016	11,768		182,318		299,577		—		493,663		6.08	%
2017	10,916		2,349		296,043		—		309,308		6.56	%
2018	8,730		27,051		99,976		167,000		302,757		3.61	%
2019	8,825		50,043		—		—		58,868		4.00	%
2020	4,280		67,361		349,524		—		421,165		4.83	%
2021	2,716		65,008		—		—		67,724		4.06	%
2022	2,211		—		399,419		—		401,630		4.13	%
2023	2,319		—		299,766		—		302,085		3.39	%
2024 and thereafter	27,266		1,946		448,808		—		478,020		4.43	%
	$	91,225	$	396,076	$	2,509,094	$	167,000	$	3,163,395	4.78	%

Mortgage Loans, Unsecured Notes

Mortgage loans with maturities ranging from 2016 to 2033 are collateralized by and in some instances cross-collateralized by properties with a net book value of $908.5 million as of December 31, 2014.

The interest rates on $2,980.4 million of mortgage loans (including $103.6 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 5.4 years.

Credit Facility

The Company has maintained an unsecured credit facility throughout 2012, 2013 and 2014. 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, 2014, borrowings under the Credit Facility would bear interest at LIBOR plus 105 basis points. 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 $167.0 million of borrowings outstanding under the Credit Facility at December 31, 2014. There is also a 20 basis point annual facility fee on the current borrowing capacity. 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 February 2012, the Company closed on a mortgage with $45 million of available funds bearing interest at 4.84% and maturing in 2033. The net proceeds from this mortgage were used for construction costs on a property under development that was placed in service during the year ended December 31, 2013.

In June 2012, the Company issued $400 million of 4.125% senior unsecured notes due 2022. The net proceeds from this issuance were used to repay borrowings under the Company's unsecured credit facility and for general corporate purposes.

In August 2012, the Company used proceeds from its unsecured credit facility together with available cash on hand to repay $230.1 million of 10-year, 6.375% senior unsecured notes due August 2012.

In December 2012, the Company issued $300 million of 3.375% senior unsecured notes due 2023. The net proceeds from this issuance were used to repay borrowings under the Company's unsecured credit facility and for general corporate purposes.

In September 2013, the Company issued $450 million of 4.40% senior unsecured notes due 2024. The net proceeds from the offering were used to fund a portion of the cash consideration payable for the Cabot Acquisition (see Note 20).

In October 2013, as part of the Cabot Acquisition, the Company assumed $229.8 million in mortgages bearing interest at a weighted average rate of 5.85% with maturity dates from 2018 to 2021.

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.