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Credit Facility
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
Credit Facility Credit Facility
The Company's outstanding credit facility as of December 31, 2023 and 2022 consisted of the following (amounts in thousands):
Weighted
Average Contractual Rate(1)
December 31, 2023December 31, 2022
Variable rate revolving line of credit—%$— $8,000 
Variable rate term loans fixed through interest rate swaps3.28%525,000 485,000 
Variable rate term loans—%— 90,000 
Total credit facility, principal amount outstanding3.28%525,000 583,000 
Unamortized deferred financing costs related to credit facility term loans(1,847)(2,412)
Total credit facility, net of deferred financing costs$523,153 $580,588 
(1)Weighted average contractual rate is as of December 31, 2023.
Significant activities regarding the credit facility during the year ended December 31, 2023 include:
•On February 17, 2023, the Company entered into an interest rate swap agreement to hedge $40,000,000 of its variable rate term loans with an effective date of March 1, 2023.
•On March 8, 2023, the Company repaid $8,000,000 on its revolving line of credit with cash flows from operations.
•On April 13, 2023, the Company repaid $10,000,000 on its 2024 term loan with proceeds from a disposition and cash flows from operations.
•On July 13, 2023, the Company repaid $10,000,000 on its 2024 term loan with proceeds from the collection of a note receivable related to a disposition and cash flows from operations.
•On September 26, 2023, the Company drew $50,000,000 on its revolving line of credit to fund an acquisition.
•On November 1, 2023, the Company repaid $8,000,000 on its revolving line of credit with cash flows from operations and proceeds from a disposition.
•On December 8, 2023, the Company, the Operating Partnership, and Truist Bank amended the credit facility to address the calculation of pool availability, including (i) removing the implied debt service coverage ratio restriction which reduces the impact of market interest rate volatility on the Company’s ability to access commitments available, (ii) removing the ground lease concentration limitation, and (iii) amending the credit facility from a borrowing base calculation to an unencumbered pool structure, including the addition of an unsecured interest coverage ratio requirement.
•On December 19, 2023, the Company repaid $42,000,000 on its revolving line of credit and $30,000,000 on its 2024 term loan with proceeds from a disposition.
The principal payments due on the credit facility as of December 31, 2023, for each of the next five years ending December 31 and thereafter, are as follows (amounts in thousands):
Amount
2024 (1)
$250,000 
2025— 
2026— 
2027— 
2028275,000 
Thereafter— 
$525,000 
(1)The 2024 term loan has a maturity date of December 31, 2024, and, at the Company's election, may be extended for a period of six-months on no more than two occasions, subject to the satisfaction of certain conditions, including the payment of an extension fee. The Company currently meets these conditions and therefore may choose to exercise its option to extend the maturity date of the 2024 term loan.
As of December 31, 2023, the maximum commitments available under the revolving line of credit were $500,000,000, which may be increased, subject to lender approval, through incremental term loans and/or revolving loan commitments in an aggregate amount not to exceed $1,000,000,000. As of December 31, 2023, the maximum commitments available under the 2024 Term Loan were $250,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $550,000,000. As of December 31, 2023, the maximum commitments available under the 2028 Term Loan Agreement were $275,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $500,000,000.
At the Company’s election, loans under the credit facility may be made as Base Rate Loans or Secured Overnight Financing Rate, or SOFR, Loans. The applicable margin for loans that are Base Rate Loans is adjustable based on a total leverage ratio, ranging from 0.25% to 0.90%. The applicable margin for loans that are SOFR Loans is adjustable based on a total leverage ratio, ranging from 1.25% to 1.90%.
In addition to interest, the Company is required to pay a fee on the unused portion of the lenders’ commitments under the revolving line of credit at a rate per annum equal to 0.20% if the average daily amount outstanding under the revolving line of credit is less than 50% of the aggregate commitments, or 0.15% if the average daily amount outstanding under the revolving line of credit is equal to or greater than 50% of the aggregate commitments. The unused fee is payable quarterly in arrears and recorded as interest expense in the accompanying consolidated statements of comprehensive income.
The revolving line of credit contains customary financial and operating covenants, including covenants relating to a maximum consolidated leverage ratio, maximum secured leverage ratio, fixed charge coverage ratio, unsecured interest coverage ratio, minimum consolidated tangible net worth, maximum distribution/payout ratio, covenants restricting the issuance of debt, imposition of liens, and entering into affiliate transactions.