v3.25.1
FAIR VALUE MEASUREMENTS
 3 Months Ended
Mar. 31, 2025
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
 
ASC 820, Fair Value Measurement and Disclosures defines fair value and establishes a framework for measuring fair value. The objective of fair value is to determine the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price). ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels: Level 1 - quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities; Level 2 - observable prices based on inputs not quoted in active markets, but corroborated by market data; and Level 3 - unobservable inputs used when little or no market data is available. The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider counterparty credit risk in our assessment of fair value.
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis
Financial assets and liabilities that are measured at fair value on our consolidated balance sheets consist of one interest rate cap and one interest rate swap. We rely on third-party valuations that use market observable inputs, such as credit spreads, yield curves and discount rates, to assess the fair value of these instruments. In accordance with the fair value hierarchy established by ASC 820, these financial instruments have been classified as Level 2 as quoted market prices are not readily available for valuing the assets. The tables below summarize the recorded amount of assets and liabilities measured at fair value on a recurring basis as of March 31, 2025 and December 31, 2024:
As of March 31, 2025
(Amounts in thousands)Level 1Level 2Level 3Total
Interest rate cap and swap(1)
$— $1,310 $— $1,310 
As of December 31, 2024
Level 1Level 2Level 3Total
Interest rate cap and swap(1)
$— $1,642 $— $1,642 
(1) Included in Prepaid expenses and other assets on the consolidated balance sheets.

Derivatives and Hedging
When we designate a derivative as a hedge, depending on the nature of the hedge, changes in the fair value of the instrument will be recognized in Other Comprehensive Income (“OCI”) until the gains or losses are reclassified to earnings. Derivatives that are not designated as hedges are adjusted to fair value through earnings. Cash flows from the derivative are included in the prepaid expenses and other assets, or accounts payable, accrued expenses and other liabilities line item in the statement of cash flows, depending on whether the hedged item is recognized as an asset or a liability. As of March 31, 2025, the Company was a counterparty to two interest rate derivative agreements which have been designated as cash flow hedges.
The tables below summarize our derivative instruments, which are used to hedge the corresponding variable rate debt, as of March 31, 2025 and December 31, 2024:
(Amounts in thousands)As of March 31, 2025
Hedged InstrumentFair ValueNotional AmountSpreadInterest RateEffective Interest RateExpiration
Plaza at Woodbridge interest rate cap$226 $50,554 
SOFR + 2.26%
6.47%5.26%7/1/2025
Montclair interest rate swap1,084 7,250 
SOFR + 2.57%
7.03%3.15%8/15/2030
As of December 31, 2024
Hedged InstrumentFair ValueNotional AmountSpreadInterest RateEffective Interest RateExpiration
Plaza at Woodbridge interest rate cap$391 $50,905 
SOFR + 2.26%
6.70%5.26%7/1/2025
Montclair interest rate swap1,251 7,250 
SOFR + 2.57%
7.10%3.15%8/15/2030

The table below summarizes the effect of our derivative instruments on our consolidated statements of income and comprehensive income for the three months ended March 31, 2025 and 2024:
Unrealized (Loss) Gain Recognized in OCI on Derivatives
(Amounts in thousands)Three Months Ended March 31,
Hedged Instrument20252024
Plaza at Woodbridge interest rate cap$(22)$189 
Montclair interest rate swap(166)104 
Total$(188)$293 

Financial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis
There were no financial assets or liabilities measured at fair value on a non-recurring basis as of March 31, 2025 and December 31, 2024.
Financial Assets and Liabilities not Measured at Fair Value
Financial assets and liabilities that are not measured at fair value on the consolidated balance sheets include cash and cash equivalents, mortgages payable and borrowings under the unsecured credit facility. Cash and cash equivalents are carried at cost, which approximates fair value. The fair value of mortgages payable and borrowings under the unsecured credit facility are calculated based on current market prices and discounted cash flows at the current rate at which similar loans would be made to borrowers with similar credit ratings for the remaining term of such debt, which is provided by a third-party specialist. The fair value of cash and cash equivalents is classified as Level 1 and the fair value of mortgages payable and borrowings under the unsecured credit facility are classified as Level 3. The table below summarizes the carrying amounts and fair value of our Level 3 financial instruments as of March 31, 2025 and December 31, 2024:
 As of March 31, 2025As of December 31, 2024
(Amounts in thousands)Carrying AmountFair ValueCarrying AmountFair Value
Mortgages payable(1)
$1,580,602 $1,487,824 $1,583,820 $1,464,996 
Unsecured credit facility75,000 72,763 50,000 48,333 
(1) Carrying amounts exclude unamortized debt issuance costs of $13.4 million and $14.1 million as of March 31, 2025 and December 31, 2024, respectively.

Nonfinancial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis
We assess the carrying value of our properties for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable. Such events and changes include macroeconomic conditions, operating performance, and environmental and regulatory changes, which may result in property operational disruption and could indicate that the carrying amount may not be recoverable.
No impairment charges were recognized during the three months ended March 31, 2025 or 2024.