v3.26.1
FAIR VALUE MEASUREMENTS
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS

NOTE 11 – FAIR VALUE MEASUREMENTS

The carrying amounts of certain of the Company’s financial instruments including cash equivalents, accounts receivable, accounts payable, accrued liabilities, and derivative financial instruments approximate fair value due either to length of maturity or interest rates that approximate prevailing market rates. The carrying value of derivative financial instruments equals fair value in accordance with U.S. GAAP. Determining which category an asset or liability falls within the hierarchy requires significant judgment. We evaluate hierarchy disclosures each reporting period.

The following table presents the assets and liabilities recorded that are reported at fair value on our Consolidated Balance Sheets on a recurring basis.

Derivative Assets and Liabilities Measured at Fair Value on a Recurring Basis

June 30, 2026

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Derivative assets

 

$

—

 

 

$

15,302

 

 

$

—

 

 

$

15,302

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liabilities

 

$

—

 

 

$

446

 

 

$

—

 

 

$

446

 

 

December 31, 2025

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Derivative assets

 

$

—

 

 

$

9,385

 

 

$

—

 

 

$

9,385

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liabilities

 

$

—

 

 

$

5,055

 

 

$

—

 

 

$

5,055

 

 

Derivative Financial Instruments

Currently, we use interest rate swaps to manage our interest rate risk associated with our notes payable. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

The fair values of interest rate options are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates rise above the strike rate of the caps. The variable interest rates used in the calculation of projected receipts on the cap are based on an expectation of future interest rates derived from observable market interest rate curves and volatilities.

To comply with the provisions of ASC 820, we incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees.

Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by ourselves and our counterparties. We have determined that the significance of the impact of the credit valuation adjustments made to our derivative contracts, which determination was based on the fair value of each individual contract, was not significant to the overall valuation. As a result, all of our derivatives held at June 30, 2026 and December 31, 2025 were classified as Level 2 of the fair value hierarchy.

The following table presents the carrying value and fair value of certain financial liabilities that are recorded on our Consolidated Balance Sheets.

Fair Value of Certain Financial Liabilities

 

June 30, 2026

 

 

December 31, 2025

 

(In thousands)

 

Carrying Value(1)

 

 

Fair Value

 

 

Carrying Value(1)

 

 

Fair Value

 

Term loan due November 2026

 

$

100,000

 

 

$

99,969

 

 

$

100,000

 

 

$

100,042

 

Term loan due February 2027

 

 

90,000

 

 

 

89,905

 

 

 

90,000

 

 

 

89,947

 

Term loan due March 2027

 

 

85,000

 

 

 

85,273

 

 

 

85,000

 

 

 

85,550

 

Term loan due February 2028

 

 

90,000

 

 

 

90,259

 

 

 

90,000

 

 

 

90,500

 

Term loan due February 2029

 

 

225,000

 

 

 

224,107

 

 

 

225,000

 

 

 

224,596

 

Term loan due April 2033

 

 

50,000

 

 

 

50,540

 

 

 

—

 

 

 

—

 

Senior fixed note due December 2026

 

 

50,000

 

 

 

49,884

 

 

 

50,000

 

 

 

50,057

 

Senior fixed note due June 2027

 

 

75,000

 

 

 

74,794

 

 

 

75,000

 

 

 

75,359

 

Senior fixed note due December 2028

 

 

50,000

 

 

 

49,253

 

 

 

50,000

 

 

 

50,106

 

Senior fixed note due April 2029

 

 

50,000

 

 

 

46,694

 

 

 

50,000

 

 

 

47,160

 

Senior fixed note due June 2029

 

 

50,000

 

 

 

47,038

 

 

 

50,000

 

 

 

47,608

 

Senior fixed note due April 2030

 

 

75,000

 

 

 

69,422

 

 

 

75,000

 

 

 

70,432

 

Senior fixed note due March 2031

 

 

50,000

 

 

 

44,317

 

 

 

50,000

 

 

 

45,070

 

Senior fixed note due April 2031

 

 

50,000

 

 

 

44,852

 

 

 

50,000

 

 

 

45,546

 

Senior fixed note due March 2032

 

 

75,000

 

 

 

66,344

 

 

 

75,000

 

 

 

67,478

 

Senior fixed note due July 2033

 

 

100,000

 

 

 

105,100

 

 

 

100,000

 

 

 

108,230

 

Revolving credit facility due February 2029

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 
(1)
Carrying values exclude deferred financing costs

The fair value of the debt (Level 2) is determined using the present value of the contractual cash flows, discounted at the current market cost of debt.