Quantitative and Qualitative Disclosures About Market Risk
−Removed: The fair value of our mortgage payable is sensitive to fluctuations in interest rates.
−Removed: Discounted cash flow analysis is generally used to estimate the fair value of our mortgage payable, using a rate of 3.22% and 3.38% as of December 31, 2021 and 2020, respectively.
−Removed: As of both December 31, 2021 and 2020, our mortgage payable had a book value of $97.1 million and a fair value of $100.8 million.
Our future income, cash flow and fair values relevant to financial instruments are dependent upon prevalent market interest rates.
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As of December 31, 2022 and 2021 (excluding premiums, discounts, and deferred loan costs), $97.1 million (or 52.1%) and $102.1 million (or 50.2%) of our debt, respectively, was fixed rate mortgage loans, and $89.3 million (or 47.9%) and $101.4 million (or 49.8%), respectively, was floating rate borrowings.
−Removed: Based on the level of floating rate debt outstanding as of December 31, 2021 and 2020, a 50 basis point change in LIBOR would result in an annual impact to our earnings of approximately $507,000 and $1.1 million, respectively.
+Added: Based on the level of floating rate debt outstanding as of December 31, 2022 and 2021, a 50 basis point change in LIBOR and SOFR would result in an annual impact to our earnings of approximately $446,000 and $507,000, respectively.
We calculate interest rate sensitivity by multiplying the amount of floating rate debt by the respective change in rate.
−Removed: The sensitivity analysis does not take into consideration possible changes in the balances or fair value of our floating rate debt.
Financial Statements and Supplementary Data
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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.