v3.25.4
Interest Rate Derivatives
 12 Months Ended
Dec. 31, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Interest Rate Derivatives Interest Rate Derivatives
Recent Transactions
On June 30, 2025, we executed three interest rate swap transactions with an aggregate notional value of $400.0 million to manage our exposure to changes in daily SOFR related to a portion of our variable-rate debt. These swaps, which became effective on July 1, 2025 and mature on May 30, 2030, fix daily SOFR at a weighted average rate of 3.41375%.
The following table sets forth a summary of the terms and fair value of our interest rate swaps as of December 31, 2025 and 2024 (dollars in thousands). We record all derivative instruments on a gross basis in the consolidated balance sheets, and accordingly, there are no offsetting amounts that net assets against liabilities. 
    
Notional Value(1)
Fair Value of Interest Rate
Derivative Assets/ (Liabilities)(2)
Derivative InstrumentEffective DateMaturity Date
Interest Strike Rate
December 31, 2025December 31, 2024December 31, 2025December 31, 2024
Interest Rate Swaps
4/3/20236/30/20253.98500 %$— $200,000 $— $233 
Interest Rate Swap4/3/20236/30/20253.96625 %$— $100,000 $— $126 
Interest Rate Swap4/3/20236/30/20253.95300 %$— $100,000 $— $132 
Interest Rate Swap4/3/20237/30/20263.71000 %$60,000 $60,000 $(65)$298 
Interest Rate Swaps7/27/20225/26/20272.81700 %$150,000 $150,000 $1,013 $4,079 
Interest Rate Swaps7/27/20225/26/20272.81750 %$150,000 $150,000 $1,012 $4,074 
Interest Rate Swap7/1/20255/30/20303.41750 %$250,000 $— $(522)$— 
Interest Rate Swap7/1/20255/30/20303.40500 %$125,000 $— $(189)$— 
Interest Rate Swap7/1/20255/30/20303.42000 %$25,000 $— $(53)$— 
(1)Represents the notional value of swaps that are effective as of the balance sheet date presented. 
(2)The fair value of derivative assets is included in the line item “Interest rate swap asset” and the fair value of derivative liabilities is included in the line item “Interest rate swap liability” in the accompanying consolidated balance sheets.
Derivative instruments that are subject to master netting arrangements and qualify for net presentation in the consolidated balance sheets are presented on a gross basis in the consolidated balance sheets as of December 31, 2025 and December 31, 2024. As of December 31, 2025, if we had recognized these derivative instruments on a net basis, we would have reported an interest rate swap asset of $1.7 million and an interest rate swap liability of $0.5 million, which represent the net balances after the effect of offsetting with counterparties where we had both derivative assets and derivative liabilities.
Our interest rate swaps are designated and qualify as cash flow hedges. We do not use derivatives for trading or speculative purposes. The change in fair value of derivatives designated and qualifying as cash flow hedges is initially recorded in AOCI and is subsequently reclassified from AOCI into earnings in the period that the hedged forecasted transactions affect earnings.
The following table sets forth the impact of our interest rate swaps on our financial statements for the periods presented (in thousands):
Year Ended December 31,
  2025 2024 2023
Interest Rate Swaps in Cash Flow Hedging Relationships:   
Amount of (loss) gain recognized in AOCI on derivatives
$(782)$11,932 $9,307 
Amount of gain reclassified from AOCI into earnings as “Interest expense” (1)
$6,654 $12,364 $10,454 
Total interest expense presented in the Consolidated Statement of Operations in which the effects of cash flow hedges are recorded (line item “Interest expense”)$104,903 $98,596 $61,400 
(1)Includes amounts that are being amortized from AOCI into interest expense on a straight-line basis related to (i) the treasury rate lock agreements that were settled in August 2021 and March 2023 and for which amounts will continue to be reclassified over the ten-year and five-year terms of the hedged transactions and (ii) the interest rate swap that was terminated in May 2022 for which amounts were reclassified into interest expense through its original maturity date of November 2024.
As of December 31, 2025, we estimate that approximately $1.2 million of net unrealized gains will be reclassified from AOCI into earnings as a net decrease to interest expense over the next twelve months.
Credit-risk-related Contingent Features
Certain of our agreements with our derivative counterparties contain a provision where if we default on any of our indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender within a specified time period, then we could also be declared in default on its derivative obligations.
Certain of our agreements with our derivative counterparties contain provisions where if a merger or acquisition occurs that materially changes our creditworthiness in an adverse manner, we may be required to fully collateralize our obligations under the derivative instrument.