v3.25.4
Debt
 12 Months Ended
Dec. 31, 2025
Debt Disclosure [Abstract]  
Debt Debt
Total debt outstanding as of December 31, 2025 and 2024 was as follows:
20252024
Debt, gross$122,904 $123,884 
Mortgage discount(1,637)(1,855)
Deferred financing costs, net(1,132)(1,316)
Total Debt, net$120,135 $120,713 
The Company’s outstanding mortgage indebtedness included 11 mortgage loans with various maturities through January 2036. The following table presents the principal amount of debt maturing each year, including amortization of principal based on debt outstanding at December 31, 2025, and the weighted average interest rates for the maturing debt in each specified period:
For the year ended December 31,As of December 31, 2025Weighted average
interest rate
2026$23,084 4.56 %
202710,785 3.99 %
2028234 — %
202920,245 5.71 %
(1)
203028,208 5.88 %
Thereafter40,348 5.32 %
(1)
Total$122,904 5.25 %
(1)See below for discussion of the derivative agreements entered into with the mortgage loans obtained on Trimble and The Muse. For Trimble (2029), the interest rate in the table above is the fixed rate. For The Muse (thereafter), the interest rate is the rate in effect at December 31, 2025.
The mortgage loan encumbering the Trimble office investment property currently leased by Veeco Instruments, Inc. matured on April 6, 2025. This loan had a principal amount of $20,000, $4,000 of which was guaranteed by Highlands. The Company exercised the 12-month extension option that was available under the original loan documents, and paid an extension fee equal to $20, to extend the maturity date on the loan to April 6, 2026. The swap arrangement that the Company entered into at the time we closed the loan fixed the interest rate at 5.86% for the term of the loan, including the extended maturity date.
In September 2025, the Company completed a long-term extension on the Trimble mortgage debt. The principal amount remains at $20,000 and the payment guarantee has been removed. The loan now matures on April 6, 2029. Additionally we completed an extension on the required fixed rate swap agreement. The swap agreement fixes the interest rate at 5.71% for the term of the loan. In conjunction with this extension, the Company paid a fee of $120 to the lender.
The mortgage loan on Buckhorn Plaza, in the amount of $8,910, matures November 6, 2026. The Company intends to sell this investment property or seek to refinance it prior to this upcoming maturity date. The mortgage loan on Market at Hilliard, in the amount of $13,737, matures December 6, 2026. The Company expects to refinance this mortgage loan as we get closer to the upcoming maturity.
The Company’s ability to pay off the mortgages when they become due is dependent upon the Company’s ability either to refinance the related mortgage debt or to sell the related investment property. With respect to each mortgage loan, if the applicable wholly-owned property-owning subsidiary is unable to refinance or sell the related investment property, or in the event that the estimated value is less than the mortgage balance, the applicable wholly-owned property-owning subsidiary may, if appropriate, satisfy a mortgage obligation by transferring title of the investment property to the lender or permitting a lender to foreclose.
As of December 31, 2024, Highlands guaranteed one mortgage loan up to $4,000 and all other mortgage debt was non-recourse to the Company. There are no payment guarantees in place on mortgage loans as of December 31, 2025. However, Highlands
or its subsidiaries may act as guarantor under customary, non-recourse, carve-out guarantees in connection with obtaining mortgage loans on certain of our investment properties.
Some of the mortgage loans require compliance with certain covenants, such as debt service coverage and net worth ratios. As of December 31, 2025 and 2024, the Company believes it was in compliance with such covenants.