3 unchanged sentences
The following is a summary of our annual exposure to a change in interest rates:
−Removed: September 30, 2023
+Added: March 31, 2024
December 31, 2023
13 unchanged sentences
(1) Includes variable rate mortgage loans with interest rate cap agreements.
−Removed: For mortgage loans with interest rate caps, the weighted average interest rate cap strike was 3.16%, and the weighted average maturity date of the interest rate caps is December 2024.
+Added: For mortgage loans with interest rate caps, the weighted average interest rate cap strike was 3.41%, and the weighted average maturity date of the interest rate caps was April 2025.
The interest rate cap strike is exclusive of the credit spreads associated with the mortgage loans.
−Removed: As of September 30, 2023, one-month term SOFR was 5.32%.
+Added: As of March 31, 2024, one-month term SOFR was 5.33%.
The impact of these interest rate caps is reflected in our calculation of the annual effect of a 1% change in base rates.
(2) Includes variable rate mortgages with interest rates fixed by interest rate swap agreements.
−Removed: (3) As of September 30, 2023, daily SOFR was 5.31%.
+Added: (3) As of March 31, 2024, daily SOFR was 5.34%.
The interest rate for our revolving credit facility excludes a 0.15% facility fee.
−Removed: (4) As of September 30, 2023 and December 31, 2022, the outstanding balance was fixed by interest rate swap agreements.
−Removed: As of September 30, 2023, the interest rate swaps fix SOFR at a weighted average interest rate of 1.46% for the Tranche A-1 Term Loan and 2.29% for the Tranche A-2 Term Loan.
+Added: (4) As of March 31, 2024 and December 31, 2023, the outstanding balance was fixed by interest rate swap agreements.
+Added: As of March 31, 2024, the interest rate swaps fix SOFR at a weighted average interest rate of 1.46% for the Tranche A-1 Term Loan, 2.29% for the Tranche A-2 Term Loan and 4.01% for the 2023 Term Loan.
See Note 7 to the financial statements for additional information.
−Removed: (5) As of September 30, 2023, the outstanding balance was fixed by an interest rate swap agreement, which fixes SOFR at an interest rate of 4.01% through the maturity date.
The fair value of our mortgage loans is estimated by discounting the future contractual cash flows of these instruments using current risk-adjusted rates available to borrowers with similar credit profiles based on market sources.
The fair value of our revolving credit facility and term loans is calculated based on the net present value of payments over the term of the facilities using estimated market rates for similar notes and remaining terms.
−Removed: As of September 30, 2023 and December 31, 2022, the estimated fair value of our consolidated debt was $2.5 billion and $2.4 billion.
+Added: As of March 31, 2024 and December 31, 2023, the estimated fair value of our consolidated debt was $2.5 billion.
These estimates of fair value, which are made at the end of the reporting period, may be different from the amounts that may ultimately be realized upon the disposition of our financial instruments.
4 unchanged sentences
We assess the effectiveness of our hedges both at inception and on an ongoing basis.
−Removed: If the hedges are deemed to be effective, the fair value is recorded in "Accumulated other comprehensive income"
−Removed: in our balance sheets and is subsequently reclassified into "Interest expense"
−Removed: in our statements of operations in the period that the hedged forecasted transactions affect earnings.
+Added: If the hedges are deemed to be effective, the fair value is recorded in "Accumulated other comprehensive income" in our balance sheets and is subsequently reclassified into "Interest expense" in our statements of operations in the period that the hedged forecasted transactions affect earnings.
Our hedges become less than perfectly effective if the critical terms of the hedging instrument and the forecasted transactions do not perfectly match such as notional amounts, settlement dates, reset dates, calculation period and interest rates.
1 unchanged sentence
While management believes its judgments are reasonable, a change in a derivative's effectiveness as a hedge could materially affect expenses, net income (loss) and equity.
−Removed: As of September 30, 2023 and December 31, 2022, we had interest rate swap and cap agreements with an aggregate notional value of $1.9 billion and $1.4 billion, which were designated as effective hedges.
−Removed: The fair value of our interest rate swaps and caps designated as effective hedges primarily consisted of assets totaling $69.5 million and $53.5 million as of September 30, 2023 and December 31, 2022, included in "Other assets, net"
−Removed: in our balance sheets.
−Removed: Derivative Financial Instruments Designated as Ineffective Hedges
−Removed: Certain derivative financial instruments, consisting of interest rate cap agreements, are cash flow hedges that are designated as ineffective hedges, and are carried at their estimated fair value on a recurring basis.
−Removed: Realized and unrealized gains or losses are recorded in "Interest expense"
−Removed: in our statements of operations.
−Removed: As of September 30, 2023 and December 31, 2022, we had various interest rate cap agreements with an aggregate notional value of $642.7 million and $711.8 million, which were designated as ineffective hedges.
−Removed: The fair value of our interest rate cap agreements designated as ineffective hedges consisted of assets totaling $9.9 million and $8.1 million as of September 30, 2023 and December 31, 2022, included in "Other assets, net"
−Removed: in our balance sheets, and liabilities totaling $9.2 million as of September 30, 2023, included in "Other liabilities, net"
−Removed: in our balance sheets.
+Added: As of March 31, 2024 and December 31, 2023, we had interest rate swap and cap agreements with an aggregate notional value of $2.2 billion, which were designated as effective hedges.
+Added: The fair value of our interest rate swaps and caps designated as effective hedges primarily consisted of assets totaling $40.6 million and $35.6 million as of March 31, 2024 and December 31, 2023, included in "Other assets, net" in our balance sheets, and liabilities totaling $16,000 and $7.9 million as of March 31, 2024 and December 31, 2023, included in "Other liabilities, net" in our balance sheet.
+Added: Non-Designated Derivatives
+Added: Certain derivative financial instruments, consisting of interest rate cap agreements, do not meet the accounting requirements to be classified as hedging instruments.
+Added: These derivatives are carried at their estimated fair value on a recurring basis with realized and unrealized gains recorded in "Interest expense" in our statements of operations.
+Added: As of March 31, 2024 and December 31, 2023, we had various interest rate cap agreements with an aggregate notional value of $475.2 million and $642.7 million, which were non-designated derivatives.
+Added: The fair value of our interest rate cap agreements which were non-designated derivatives consisted of assets totaling $6.5 million and $6.7 million as of March 31, 2024 and December 31, 2023, included in "Other assets, net" in our balance sheets, and liabilities totaling $6.4 million and $6.5 million as of March 31, 2024 and December 31, 2023, included in "Other liabilities, net" in our balance sheets.
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.