| 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, land and development projects. As of March 31, 2021, 19 of the Company’s properties, with a total carrying value of approximately $2.9 billion and three of the Company’s land and development projects, with a total carrying value of approximately $634 million, are encumbered by the Company’s mortgages and loans payable. Payments on mortgages, loans payable and other obligations are generally due in monthly installments of principal and interest, or interest only. The Company was in compliance with its debt covenants requirements under its mortgages and loans payable as of March 31, 2021.
A summary of the Company’s mortgages, loans payable and other obligations as of March 31, 2021 and December 31, 2020 is as follows (dollars in thousands):
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Effective |
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March 31, |
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December 31, |
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Property/Project Name |
Lender |
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Rate (a) |
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2021 |
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2020 |
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Maturity |
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Port Imperial South 4/5 Retail |
American General Life & A/G PC |
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4.56 |
% |
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$ |
3,848 |
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$ |
3,866 |
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12/01/21 |
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Port Imperial 4/5 Hotel (b) |
Fifth Third Bank |
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LIBOR+3.40 |
% |
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94,000 |
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94,000 |
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04/09/22 |
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Port Imperial South 9 (c) |
Bank of New York Mellon |
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LIBOR+2.13 |
% |
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60,253 |
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46,357 |
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12/19/22 |
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Portside 7 |
CBRE Capital Markets/FreddieMac |
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3.57 |
% |
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58,998 |
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58,998 |
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08/01/23 |
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Short Hills Residential (d) |
People's United Bank |
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LIBOR+2.15 |
% |
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50,395 |
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42,459 |
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03/26/23 |
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250 Johnson |
Nationwide Life Insurance Company |
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3.74 |
% |
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43,000 |
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43,000 |
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08/01/24 |
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Liberty Towers (e) |
American General Life Insurance Company |
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3.37 |
% |
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265,000 |
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265,000 |
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10/01/24 |
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The Charlotte (f) |
QuadReal Finance |
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LIBOR+2.70 |
% |
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183,863 |
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161,544 |
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12/01/24 |
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Portside 5/6 (g) |
New York Life Insurance Company |
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4.56 |
% |
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97,000 |
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97,000 |
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03/10/26 |
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Marbella (BLVD 425) |
New York Life Insurance Company |
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4.17 |
% |
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131,000 |
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131,000 |
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08/10/26 |
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Marbella II (BLVD 401) |
New York Life Insurance Company |
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4.29 |
% |
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117,000 |
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117,000 |
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08/10/26 |
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101 Hudson |
Wells Fargo CMBS |
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3.20 |
% |
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250,000 |
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250,000 |
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10/11/26 |
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Worcester |
MUFG Union Bank |
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LIBOR+1.84 |
% |
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63,000 |
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63,000 |
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12/10/26 |
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Short Hills Portfolio (h) |
Wells Fargo CMBS |
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4.15 |
% |
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124,500 |
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124,500 |
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04/01/27 |
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150 Main St. |
Natixis Real Estate Capital LLC |
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4.48 |
% |
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41,000 |
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41,000 |
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08/05/27 |
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Monaco (BLVD 495 N/S) (l) |
The Northwestern Mutual Life Insurance Co. |
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2.91 |
% |
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165,000 |
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165,000 |
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11/10/27 |
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Port Imperial South 11 |
The Northwestern Mutual Life Insurance Co. |
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4.52 |
% |
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100,000 |
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100,000 |
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01/10/29 |
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Soho Lofts (i) |
New York Community Bank |
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3.77 |
% |
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160,000 |
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160,000 |
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07/01/29 |
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111 River St. |
Athene Annuity and Life Company |
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3.90 |
% |
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150,000 |
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150,000 |
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09/01/29 |
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Port Imperial South 4/5 Garage (j) |
American General Life & A/G PC |
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4.85 |
% |
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33,023 |
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33,138 |
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12/01/29 |
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Emery at Overlook Ridge (k) |
New York Community Bank |
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3.21 |
% |
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72,000 |
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72,000 |
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01/01/31 |
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Principal balance outstanding |
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2,262,880 |
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2,218,862 |
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Unamortized deferred financing costs |
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(13,861) |
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(14,718) |
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Total mortgages, loans payable and other obligations, net |
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$ |
2,249,019 |
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$ |
2,204,144 |
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(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 loan required an initial debt service coverage test for quarter ended September 30, 2020. Subsequent to September 30, 2020, the Company executed an agreement moving the initial debt service coverage test to March 31, 2021. On April 29, 2021, the Company executed a letter agreement with the Lender waiving the debt service coverage compliance requirement for up to a 30-day period. During that time period, the Company anticipates negotiating a loan amendment with the lender to modify the debt service coverage test and extend its maturity date, amongst other terms. The Company has guaranteed $19.5 million of the outstanding principal, subject to certain conditions, which it would be required to repay if the loan is not amended during the 30-day waiver period discussed above. |
(c) |
This construction loan has a maximum borrowing capacity of $92 million and provides, subject to certain conditions, and a one year extension option with a fee of 15 basis points, of which the Company has guaranteed 10 percent of the outstanding principal, subject to certain conditions. |
(d) |
This construction loan has a maximum borrowing capacity of $64 million and provides, subject to certain conditions, and an 18 month extension option with a fee of 30 basis points, of which the Company has guaranteed 15 percent of the outstanding principal, subject to certain conditions. |
(e) |
In January 2020, the Company increased the size of the loan on Liberty Towers to $265 million, generating $33 million of additional proceeds. |
(f) |
This construction loan has a LIBOR floor of 2.0 percent, has a maximum borrowing capacity of $300 million and provides, subject to certain conditions, one one year extension option with a fee of 25 basis points. |
(g) |
The Company has guaranteed 10 percent of the outstanding principal, subject to certain conditions. |
(h) |
Properties, which are collateral for this mortgage loan, are classified as held for sale as of March 31, 2021. This mortgage loan does not permit early pre-payment. In April 2021, as a result of the disposal of the properties, which are collateral for this loan, the Company paid approximately $22 million at closing to defease this loan, which will be expensed in the second quarter 2021. |
(i) |
Effective rate reflects the first five years of interest payments at a fixed rate. Interest payments after that period ends are based on LIBOR plus 2.75% annually. |
(j) |
The loan was modified to defer interest and principal payments for a six month period ending December 31, 2020. As of March 31, 2021, deferred interest of $0.8 million has been added to the principal balance. |
(k) |
In December 2020, the Company obtained a new $72 million mortgage loan collateralized by the Emery that matures on January 1, 2031 and received net loan proceeds of $10.4 million after repaying its construction loan. |
(l) |
In November 2020, the Company modified this mortgage loan, extending the maturity date from February 2021 to November 2027. As of March 31, 2021 the Company has an outstanding guaranty of $12 million subject to adjustment based on property occupancy levels. |
CASH PAID FOR INTEREST AND INTEREST CAPITALIZED
Cash paid for interest for the three months ended March 31, 2021 and 2020 was $18,087,000 and $20,990,000 (of which $1,264,000 and $1,278,000 pertained to properties classified as discontinued operations), respectively. Interest capitalized by the Company for the three months ended March 31, 2021 and 2020 was $8,583,000 and $5,856,000, respectively (which amounts included $338,000 and $346,000 for the three months ended March 31, 2021 and 2020, respectively, of interest capitalized on the Company’s investments in unconsolidated joint ventures which were substantially in development).
SUMMARY OF INDEBTEDNESS
As of March 31, 2021, the Company’s total indebtedness of $2,821,964,000 (weighted average interest rate of 3.77 percent) was comprised of $447,032,000 of variable rate mortgage debt (weighted average rate of 3.47 percent) and fixed rate debt and other obligations of $2,374,932,000 (weighted average rate of 3.83 percent).
As of December 31, 2020, the Company’s total indebtedness of $2,801,797,000 (weighted average interest rate of 3.76 percent) was comprised of $427,419,000 of unsecured revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 3.38 percent) and fixed rate debt and other obligations of $2,374,378,000 (weighted average rate of 3.83 percent).
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| 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, land and development projects. As of March 31, 2021, 19 of the Company’s properties, with a total carrying value of approximately $2.9 billion and three of the Company’s land and development projects, with a total carrying value of approximately $634 million, are encumbered by the Company’s mortgages and loans payable. Payments on mortgages, loans payable and other obligations are generally due in monthly installments of principal and interest, or interest only. The Company was in compliance with its debt covenants requirements under its mortgages and loans payable as of March 31, 2021.
A summary of the Company’s mortgages, loans payable and other obligations as of March 31, 2021 and December 31, 2020 is as follows (dollars in thousands):
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Effective |
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March 31, |
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December 31, |
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Property/Project Name |
Lender |
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Rate (a) |
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2021 |
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2020 |
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Maturity |
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Port Imperial South 4/5 Retail |
American General Life & A/G PC |
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4.56 |
% |
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$ |
3,848 |
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$ |
3,866 |
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12/01/21 |
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Port Imperial 4/5 Hotel (b) |
Fifth Third Bank |
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LIBOR+3.40 |
% |
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94,000 |
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94,000 |
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04/09/22 |
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Port Imperial South 9 (c) |
Bank of New York Mellon |
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LIBOR+2.13 |
% |
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60,253 |
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46,357 |
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12/19/22 |
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Portside 7 |
CBRE Capital Markets/FreddieMac |
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3.57 |
% |
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58,998 |
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58,998 |
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08/01/23 |
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Short Hills Residential (d) |
People's United Bank |
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LIBOR+2.15 |
% |
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50,395 |
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42,459 |
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03/26/23 |
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250 Johnson |
Nationwide Life Insurance Company |
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3.74 |
% |
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43,000 |
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43,000 |
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08/01/24 |
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Liberty Towers (e) |
American General Life Insurance Company |
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3.37 |
% |
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265,000 |
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265,000 |
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10/01/24 |
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The Charlotte (f) |
QuadReal Finance |
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LIBOR+2.70 |
% |
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183,863 |
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161,544 |
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12/01/24 |
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Portside 5/6 (g) |
New York Life Insurance Company |
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4.56 |
% |
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97,000 |
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97,000 |
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03/10/26 |
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Marbella (BLVD 425) |
New York Life Insurance Company |
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4.17 |
% |
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131,000 |
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131,000 |
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08/10/26 |
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Marbella II (BLVD 401) |
New York Life Insurance Company |
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4.29 |
% |
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117,000 |
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117,000 |
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08/10/26 |
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101 Hudson |
Wells Fargo CMBS |
|
3.20 |
% |
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250,000 |
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250,000 |
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10/11/26 |
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Worcester |
MUFG Union Bank |
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LIBOR+1.84 |
% |
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63,000 |
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63,000 |
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12/10/26 |
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Short Hills Portfolio (h) |
Wells Fargo CMBS |
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4.15 |
% |
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124,500 |
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124,500 |
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04/01/27 |
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150 Main St. |
Natixis Real Estate Capital LLC |
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4.48 |
% |
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41,000 |
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41,000 |
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08/05/27 |
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Monaco (BLVD 495 N/S) (l) |
The Northwestern Mutual Life Insurance Co. |
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2.91 |
% |
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165,000 |
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165,000 |
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11/10/27 |
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Port Imperial South 11 |
The Northwestern Mutual Life Insurance Co. |
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4.52 |
% |
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100,000 |
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100,000 |
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01/10/29 |
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Soho Lofts (i) |
New York Community Bank |
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3.77 |
% |
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160,000 |
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160,000 |
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07/01/29 |
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111 River St. |
Athene Annuity and Life Company |
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3.90 |
% |
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150,000 |
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150,000 |
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09/01/29 |
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Port Imperial South 4/5 Garage (j) |
American General Life & A/G PC |
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4.85 |
% |
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33,023 |
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33,138 |
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12/01/29 |
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Emery at Overlook Ridge (k) |
New York Community Bank |
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3.21 |
% |
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72,000 |
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|
72,000 |
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01/01/31 |
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Principal balance outstanding |
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2,262,880 |
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2,218,862 |
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Unamortized deferred financing costs |
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(13,861) |
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(14,718) |
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Total mortgages, loans payable and other obligations, net |
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|
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$ |
2,249,019 |
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$ |
2,204,144 |
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(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 loan required an initial debt service coverage test for quarter ended September 30, 2020. Subsequent to September 30, 2020, the Company executed an agreement moving the initial debt service coverage test to March 31, 2021. On April 29, 2021, the Company executed a letter agreement with the Lender waiving the debt service coverage compliance requirement for up to a 30-day period. During that time period, the Company anticipates negotiating a loan amendment with the lender to modify the debt service coverage test and extend its maturity date, amongst other terms. The Company has guaranteed $19.5 million of the outstanding principal, subject to certain conditions, which it would be required to repay if the loan is not amended during the 30-day waiver period discussed above. |
(c) |
This construction loan has a maximum borrowing capacity of $92 million and provides, subject to certain conditions, and a one year extension option with a fee of 15 basis points, of which the Company has guaranteed 10 percent of the outstanding principal, subject to certain conditions. |
(d) |
This construction loan has a maximum borrowing capacity of $64 million and provides, subject to certain conditions, and an 18 month extension option with a fee of 30 basis points, of which the Company has guaranteed 15 percent of the outstanding principal, subject to certain conditions. |
(e) |
In January 2020, the Company increased the size of the loan on Liberty Towers to $265 million, generating $33 million of additional proceeds. |
(f) |
This construction loan has a LIBOR floor of 2.0 percent, has a maximum borrowing capacity of $300 million and provides, subject to certain conditions, one one year extension option with a fee of 25 basis points. |
(g) |
The Company has guaranteed 10 percent of the outstanding principal, subject to certain conditions. |
(h) |
Properties, which are collateral for this mortgage loan, are classified as held for sale as of March 31, 2021. This mortgage loan does not permit early pre-payment. In April 2021, as a result of the disposal of the properties, which are collateral for this loan, the Company paid approximately $22 million at closing to defease this loan, which will be expensed in the second quarter 2021. |
(i) |
Effective rate reflects the first five years of interest payments at a fixed rate. Interest payments after that period ends are based on LIBOR plus 2.75% annually. |
(j) |
The loan was modified to defer interest and principal payments for a six month period ending December 31, 2020. As of March 31, 2021, deferred interest of $0.8 million has been added to the principal balance. |
(k) |
In December 2020, the Company obtained a new $72 million mortgage loan collateralized by the Emery that matures on January 1, 2031 and received net loan proceeds of $10.4 million after repaying its construction loan. |
(l) |
In November 2020, the Company modified this mortgage loan, extending the maturity date from February 2021 to November 2027. As of March 31, 2021 the Company has an outstanding guaranty of $12 million subject to adjustment based on property occupancy levels. |
CASH PAID FOR INTEREST AND INTEREST CAPITALIZED
Cash paid for interest for the three months ended March 31, 2021 and 2020 was $18,087,000 and $20,990,000 (of which $1,264,000 and $1,278,000 pertained to properties classified as discontinued operations), respectively. Interest capitalized by the Company for the three months ended March 31, 2021 and 2020 was $8,583,000 and $5,856,000, respectively (which amounts included $338,000 and $346,000 for the three months ended March 31, 2021 and 2020, respectively, of interest capitalized on the Company’s investments in unconsolidated joint ventures which were substantially in development).
SUMMARY OF INDEBTEDNESS
As of March 31, 2021, the Company’s total indebtedness of $2,821,964,000 (weighted average interest rate of 3.77 percent) was comprised of $447,032,000 of variable rate mortgage debt (weighted average rate of 3.47 percent) and fixed rate debt and other obligations of $2,374,932,000 (weighted average rate of 3.83 percent).
As of December 31, 2020, the Company’s total indebtedness of $2,801,797,000 (weighted average interest rate of 3.76 percent) was comprised of $427,419,000 of unsecured revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 3.38 percent) and fixed rate debt and other obligations of $2,374,378,000 (weighted average rate of 3.83 percent).
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