4 unchanged sentences
Interest Rate Risk
−Removed: We are exposed to the effects of interest rate changes primarily as a result of long-term debt used to acquire and develop properties and other permitted investments.
+Added: We are exposed to the effects of interest rate changes primarily as a result of long-term debt used to acquire and develop properties and other investments.
Our interest rate risk is monitored using a variety of techniques.
2 unchanged sentences
We have entered into, and may continue to enter into, derivative financial instruments such as interest rate swaps and interest rate caps in order to mitigate our interest rate risk on a related financial instrument, and for which we have not and may not elect hedge accounting treatment.
−Removed: We have not elected to apply hedge accounting treatment to these derivatives;
−Removed: therefore, changes in the fair value of interest rate derivative financial instruments are recorded as a component of interest expense in gain or loss in fair value of derivative financial instruments in our accompanying consolidated statements of operations and comprehensive income (loss).
−Removed: As of December 31, 2021, our interest rate swaps are recorded in security deposits, prepaid rent and other liabilities in our accompanying consolidated balance sheets at their fair value of $500,000, and such swaps matured in January 2022.
+Added: We did not elect to apply hedge accounting treatment to these derivatives;
+Added: therefore, changes in the fair value of interest rate derivative financial instruments were recorded as a component of interest expense in gain or loss in fair value of derivative financial instruments in our accompanying consolidated statements of operations and comprehensive income (loss).
+Added: As of December 31, 2022, we did not have any derivative financial instruments.
We do not enter into derivative transactions for speculative purposes.
−Removed: In July 2017, the Financial Conduct Authority, or FCA, that regulates LIBOR announced its intention to stop compelling banks to submit rates for the calculation of LIBOR after 2021.
−Removed: As a result, the Federal Reserve Board and the Federal Reserve Bank of New York organized the Alternative Reference Rates Committee, which identified the Secured Overnight Financing Rate, or SOFR, as its preferred alternative to United States dollar LIBOR in derivatives and other financial contracts.
−Removed: The FCA ceased publishing one-week and two-month LIBOR after December 31, 2021 and intends to cease publishing all remaining LIBOR after June 30, 2023.
−Removed: On January 19, 2022, we entered into the 2022 Credit Agreement that bears interest at varying rates based upon our option, as follows:
−Removed: (i) the Daily Simple Secured Overnight Financing Rate, or Daily SOFR, as defined in the 2022 Credit Agreement, plus the Applicable Rate for Daily SOFR Rate Loans or (ii) the Term Secured Overnight Financing Rate, or the Term SOFR, as defined in the 2022 Credit Agreement, plus the Applicable Rate for Term SOFR Rate Loans.
−Removed: Please see Note 22, Subsequent Events — 2022 Credit Facility, for a further discussion.
−Removed: We have variable rate debt outstanding and maturing on various dates from 2022 to 2031 and interest rate swaps maturing in January 2022, as discussed above, that are indexed to LIBOR.
+Added: See Note 22, Subsequent Events — Interest Rate Swap, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.
+Added: The Financial Conduct Authority, or FCA, ceased publishing one-week and two-month LIBOR after December 31, 2021 and intends to cease publishing all remaining LIBOR after June 30, 2023.
+Added: On January 19, 2022, we through our operating partnership, entered into the 2022 Credit Facility that bears interest at varying SOFR rates, at our option.
+Added: On December 20, 2022, we entered into an amendment to the 2019 Trilogy Credit Facility, that among other things, replaced all references of LIBOR to SOFR.
+Added: See Note 9, Lines of Credit and Term Loans — 2022 Credit Facility, and 2019 Trilogy Credit Facility, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion of the interest rate terms applicable to such facilities.
+Added: We have variable-rate debt outstanding and maturing on various dates from 2023 to 2031 that are indexed to LIBOR.
As such, we are monitoring and evaluating the related risks of the discontinuation of LIBOR, which include possible changes to the interest on loans or amounts received and paid on derivative instruments we may enter into in the future.
These risks arise in connection with transitioning contracts to a new alternative rate, including any resulting value transfer that may occur.
−Removed: The value of loans or derivative instruments tied to LIBOR could also be impacted if LIBOR is discontinued.
+Added: The value of loans or derivative instruments tied to LIBOR could also be impacted when LIBOR is discontinued.
For some instruments, the method of transitioning to an alternative rate may be challenging, as they may require negotiation with the respective counterparty.
−Removed: If a contract is not transitioned to an alternative rate and LIBOR is discontinued, the impact on our contracts is likely to vary.
−Removed: If LIBOR is discontinued, interest rates on our current or future indebtedness may be adversely affected.
+Added: If a contract is not transitioned to an alternative rate when LIBOR is discontinued, the impact on our contracts is likely to vary.
+Added: When LIBOR is discontinued, interest rates on our current or future indebtedness may be adversely affected.
Currently we cannot estimate the overall impact of the phase-out of LIBOR on our current debt agreements, although it is possible that an alternative variable rate could raise our borrowing costs.
24 unchanged sentences
As of December 31, 2022, we had 68 fixed-rate mortgage loans payable and 11 variable-rate mortgage loans payable with effective interest rates ranging from 2.21% to 7.26% per annum and a weighted average effective interest rate of 5.29%.
−Removed: In addition, as of December 31, 2021, we had $1,226,634,000 outstanding under our lines of credit and term loans, at a weighted-average interest rate of 2.55% per annum.
−Removed: On October 1, 2021, as a result of the Merger, we recognized the fair value of GAHR IV's three fixed-rate mortgage loans of $18,602,000, which consist of an aggregate principal balance of $18,291,000 and premium of $311,000.
−Removed: These mortgage loans carry interest rates ranging from 3.67% to 5.25% per annum with maturity dates ranging from April 1, 2025 to February 1, 2051 and a weighted average effective interest rate of 3.91%.
−Removed: As of December 31, 2021, the weighted average effective interest rate on our outstanding debt, factoring in our fixed-rate interest rate swaps, was 3.18% per annum.
+Added: In addition, as of December 31, 2022, we had $1,282,634,000 ($1,281,794,000, net of deferred financing fees) outstanding under our lines of credit and term loans, at a weighted-average interest rate of 6.34% per annum.
+Added: As of December 31, 2022, the weighted average effective interest rate on our outstanding debt was 5.82% per annum.
An increase in the variable interest rate on our variable-rate mortgage loans payable and lines of credit and term loans constitutes a market risk.
−Removed: As of December 31, 2021, we have three fixed-rate interest rate swaps on our term loan;
−Removed: an increase in the variable interest rate thereon would have no effect on our overall annual interest expense.
As of December 31, 2022, a 0.50% increase in the market rates of interest would have increased our overall annualized interest expense on all of our other variable-rate mortgage loans payable and lines of credit and term loans by $8,371,000, or 7.76% of total annualized interest expense on our mortgage loans payable and lines of credit and term loans.
−Removed: Note 8, Mortgage Loans Payable, Net, and Note 9, Lines of Credit and Term Loans, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.
+Added: See Note 8, Mortgage Loans Payable, Net, and Note 9, Lines of Credit and Term Loans, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.
Other Market Risk
4 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.