Veris Residential, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Mortgages, Loans Payable And Other Obligations

Mortgages, Loans Payable And Other Obligations

12 Months Ended

Dec. 31, 2011

Mortgages, Loans Payable And Other Obligations [Abstract]

Mortgages, Loans Payable And Other Obligations

10.	MORTGAGES, LOANS PAYABLE AND OTHER OBLIGATIONS

The Company has mortgages, loans payable and other obligations which primarily consist of various loans collateralized by certain of the Company's rental properties. As of December 31, 2011, 32 of the Company's properties, with a total book value of approximately $950,891,000, are encumbered by the Company's mortgages and loans payable. Payments on mortgages, loans payable and other obligations are generally due in monthly installments of principal and interest, or interest only.

A summary of the Company's mortgages, loans payable and other obligations as of December 31, 2011 and 2010 is as follows: (dollars in thousands


			Effective
				Interest	December 31,
Property Name	Lender			Rate (a)	2011		2010	Maturity
2200 Renaissance Boulevard (b)	Wachovia CMBS			5.888%	$ 16,171		$ 16,171	12/01/12
One Grande Commons (c)	Capital One Bank	LIBOR +2.00%			11,000		11,000	12/31/12
Soundview Plaza	Morgan Stanley Mortgage Capital			6.015%	15,531		16,089	01/01/13
9200 Edmonston Road	Principal Commercial Funding L.L.C.			5.534%	4,479		4,646	05/01/13
6305 Ivy Lane	John Hancock Life Insurance Co.			5.525%	6,245		6,475	01/01/14
395 West Passaic	State Farm Life Insurance Co.			6.004%	10,781		11,270	05/01/14
6301 Ivy Lane	John Hancock Life Insurance Co.			5.520%	5,899		6,103	07/01/14
35 Waterview Boulevard	Wachovia CMBS			6.348%	19,051		19,341	08/11/14
6 Becker, 85 Livingston, 75 Livingston & 20 Waterview	Wachovia CMBS			10.220%	62,127		61,224	08/11/14
4 Sylvan	Wachovia CMBS			10.190%	14,438		14,395	08/11/14
10 Independence	Wachovia CMBS			12.440%	15,908		15,606	08/11/14
4 Becker	Wachovia CMBS			9.550%	37,769		37,096	05/11/16
5 Becker	Wachovia CMBS			12.830%	12,056		11,599	05/11/16
210 Clay	Wachovia CMBS			13.420%	11,844		11,467	05/11/16
51 Imclone	Wachovia CMBS			8.390%	3,886		3,893	05/11/16
Various (d)	Prudential Insurance			6.332%	150,000		150,000	01/15/17
23 Main Street	JPMorgan CMBS			5.587%	31,002		31,537	09/01/18
Harborside Plaza 5	The Northwestern Mutual Life Insurance Co. & New York Life Insurance Co.			6.842%	231,603		234,521	11/01/18
100 Walnut Avenue	Guardian Life Insurance Co.			7.311%	19,241		19,443	02/01/19
One River Center (e)	Guardian Life Insurance Co.			7.311%	44,079		44,540	02/01/19
581 Main Street (f)	Valley National Bank			6.935% (g)		16,338	16,627	07/01/34

Total mortgages, loans payable and other obligations					$739,448		$743,043

(a) Reflects effective rate of debt, including deferred financing costs, comprised of the cost of terminated treasury lock agreements (if any), debt initiation costs, mark-to-market adjustment of acquired debt and other transaction costs, as applicable.

(b) The property does not generate sufficient cash flow to meet debt service requirements. As a result, beginning January 2011, debt service has not been made and the Company is currently in discussion with the lender regarding a deed in lieu of foreclosure. As of December 31, 2010, the Company estimated that the carrying value of the property may not be recoverable over its anticipated holding period. In order to reduce the carrying value of the property to its estimated fair market value, the Company recorded an impairment charge of approximately $9.5 million in 2010.

(d) Mortgage is collateralized by seven properties. The Operating Partnership has agreed, subject to certain conditions, to guarantee repayment of a portion of the loan.

(e) Mortgage is collateralized by the three properties comprising One River Center.

(f) The Operating Partnership has agreed, subject to certain conditions, to guarantee repayment of a portion of the loan.

(g) The coupon interest rate will be reset at the end of year 10 (2019) and year 20 (2029) at 225 basis points over the 10-year treasury yield 45 days prior to the reset dates with a minimum rate of 6.875 percent.

)SCHEDULED PRINCIPAL PAYMENTS

Scheduled principal payments and related weighted average annual interest rates for the Company's senior unsecured notes (see Note 8), unsecured revolving credit facility and mortgages, loans payable and other obligations as of December 31, 2011 are as follows: (dollars in thousands)


	Scheduled			Principal					Weighted Avg.
	Amortization			Maturities		Total			Interest Rate of
Period	($000's)			($000's)		($000's)			Future Repayments (a)
2012	$	11,159		$	221,148	$	232,307			6.05	%
2013		11,315			145,223		156,538			5.39	%
2014		10,468			335,257		345,725			6.82	%
2015		8,941			205,500		214,441			4.41	%	(b)
2016		8,753			273,120		281,873			7.16	%
Thereafter		26,992			679,562		706,554			7.15	%
Sub-total		77,628			1,859,810		1,937,438
Adjustment for unamortized debt
discount/premium and
mark-to-market, net, as of
December 31, 2011		(23,223	)		--		(23,223	)

Totals/Weighted Average	$	54,405		$	1,859,810	$	1,914,215			6.46	%

(a) The actual weighted average LIBOR rate for the Company's outstanding variable rate debt was 0.29 percent as of December 31, 2011.
(b) Excludes amortized deferred financing costs pertaining to the Company's unsecured revolving credit facility which amounted to $2.6 million for the year ended December 31, 2011.

CASH PAID FOR INTEREST AND INTEREST CAPITALIZED

Cash paid for interest for the years ended December 31, 2011, 2010 and 2009 was $116,772,000, $153,608,000 and $131,912,000, respectively. Interest capitalized by the Company for the years ended December 31, 2011, 2010 and 2009 was $1,081,000, $1,912,000 and $1,401,000, respectively.

SUMMARY OF INDEBTEDNESS

As of December 31, 2011, the Company's total indebtedness of $1,914,215,000 (weighted average interest rate of 6.46 percent) was comprised of $66,500,000 of revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 1.77 percent) and fixed rate debt and other obligations of $1,847,715,000 (weighted average rate of 6.63 percent).

As of December 31, 2010, the Company's total indebtedness of $2,089,494,000 (weighted average interest rate of 5.97 percent) was comprised of $239,000,000 of revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 0.90 percent) and fixed rate debt and other obligations of $1,850,494,000 (weighted average rate of 6.62 percent).