Quarterly report pursuant to Section 13 or 15(d)

Debt of the Operating Partnership

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Debt of the Operating Partnership
 9 Months Ended
Sep. 30, 2023
Debt Disclosure [Abstract]  
Debt of the Operating Partnership Debt Guaranteed by the Company
All of the Company’s debt is held by the Operating Partnership and its consolidated subsidiaries.

The Company guarantees the Operating Partnership’s obligations with respect to its unsecured lines of credit which have a total borrowing capacity of $520.0 million as of September 30, 2023. The Company also guarantees the Operating Partnership’s unsecured term loan.

The Operating Partnership had the following principal amounts outstanding on the debt guaranteed by the Company (in thousands):
As of
September 30, 2023 December 31, 2022
Unsecured lines of credit $ —  $ — 
Unsecured term loan $ 325,000  $ 325,000 
Debt of the Operating Partnership
The debt of the Operating Partnership consisted of the following (in thousands):
As of As of
September 30, 2023 December 31, 2022
Stated Interest Rate(s) Maturity Date Principal
Book Value(1)
Principal
Book Value(1)
Senior, unsecured notes:  
Senior notes 3.125  % September 2026 $ 350,000  $ 348,323  $ 350,000  $ 347,894 
Senior notes 3.875  % July 2027 300,000  298,444  300,000  298,142 
Senior notes 2.750  % September 2031 400,000  392,610  400,000  391,962 
Mortgages payable:
Atlantic City (2) (3)
6.44  % - 7.65% December 2024- December 2026 13,562  13,889  17,109  17,625 
     Southaven Adj SOFR + 2.00% October 2026 51,700  51,404  51,700  51,346 
Unsecured term loan Adj SOFR + 0.95% January 2027 325,000  322,162  325,000  321,525 
Unsecured lines of credit Adj SOFR + 1.00% July 2025 —  —  —  — 
  $ 1,440,262  $ 1,426,832  $ 1,443,809  $ 1,428,494 
(1)Including premiums and net of debt discount and debt origination costs. Excludes $2.8 million and $3.5 million of unamortized debt origination costs related to the unsecured lines of credit for the periods ended September 30, 2023 and December 31, 2022, respectively, recorded in prepaids and other assets in the Consolidated Balance Sheet.
(2)The effective interest rate assigned during the purchase price allocation to the Atlantic City mortgages assumed during the acquisition in 2011 was 5.05%.
(3)Principal and interest due monthly with remaining principal due at maturity.

Certain of our properties, which had a net book value of approximately $139.2 million at September 30, 2023, serve as collateral for mortgages payable. As of September 30, 2023, we maintained unsecured lines of credit that provided for borrowings of up to $520.0 million. The unsecured lines of credit as of September 30, 2023 included a $20.0 million liquidity line and a $500.0 million syndicated line. The syndicated line may be increased up to $1.2 billion through an accordion feature in certain circumstances.

We provide guarantees to lenders for our joint ventures, which include standard non-recourse carve out indemnifications for losses arising from items such as but not limited to fraud, physical waste, payment of taxes, environmental indemnities, misapplication of insurance proceeds or security deposits and failure to maintain required insurance. For term loans, we may include a guaranty of completion as well as a principal guaranty ranging from 0% to 17.2% of principal. As of September 30, 2023, the maximum amount of unconsolidated joint venture debt guaranteed by the Company was $10.0 million.

The unsecured lines of credit and senior unsecured notes include covenants that require the maintenance of certain ratios, including debt service coverage and leverage, and limit the payment of dividends such that dividends and distributions will not exceed funds from operations, as defined in the agreements, for the prior fiscal year on an annual basis or 95% of funds from operations on a cumulative basis. As of September 30, 2023, we believe we were in compliance with all of our debt covenants.

In May 2023, Fitch Ratings assigned a first-time ‘BBB’ long-term issuer default rating to the Company and the Operating Partnership, along with a Stable rating outlook. Fitch also assigned a ‘BBB’ rating to Operating Partnership’s senior unsecured debt, which includes our lines of credit, a term loan and senior notes. As a result, the applicable pricing margin on each of our unsecured lines of credit and our term loan was reduced by 25 basis points (including a 5 basis point reduction in the facility fee on the unsecured lines of credit).
Debt Maturities

Maturities and principal amortization of the existing long-term debt as of September 30, 2023 for the next five years and thereafter are as follows (in thousands):
Calendar Year Amount
For the remainder of 2023 $ 1,226 
2024 5,130 
2025 1,501 
2026 407,405 
2027 625,000 
Thereafter 400,000 
Subtotal 1,440,262 
Net discount and debt origination costs (13,430)
Total $ 1,426,832 
We have considered our short-term (one year or less from the date of filing these financial statements) liquidity needs and the adequacy of our estimated cash flows from operating activities and other financing sources to meet these needs. These other sources include but are not limited to: existing cash, ongoing relationships with certain financial institutions, our ability to sell debt or issue equity subject to market conditions and proceeds from the potential sale of non-core assets. We believe that we have access to the necessary financing to fund our short-term liquidity needs.