Derivatives |
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| Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Derivatives | Note 10 – Derivatives We use forward currency contracts to economically hedge interest and principal payments due under our loans denominated in currencies other than USD. Historically, we have entered into a series of forward contracts to sell an amount of foreign currency (GBP, EUR and SEK) for an agreed upon amount of USD at various dates. These forward contracts were executed to economically fix the USD amounts of foreign denominated cash flows expected to be received by us related to foreign denominated loan investments. In connection with the Asset Sale, we unwound all forward currency contracts during the three months ended June 30, 2026. The agreements with our derivative counterparties required that we post collateral to secure net liability positions. As of June 30, 2026, there was no collateral posted as all forward currency contracts were unwound during the three months ended June 30, 2026 as a result of the Asset Sale. As of December 31, 2025, we were in a net liability position with our derivative counterparties and posted collateral of $27.4 million, included within other assets on our condensed consolidated balance sheet. The following table summarizes our non-designated Fx forwards and interest rate cap as of December 31, 2025. As previously stated, we did not hold any forward currency contracts or interest rate caps as of June 30, 2026.
We have not designated any of our derivative instruments as hedges as defined in ASC Topic 815, "Derivatives and Hedging" and, therefore, changes in the fair value of our derivative instruments are recorded directly in earnings. The following table summarizes the amounts recognized on our condensed consolidated statements of operations related to our forward currency contracts for the three and six months ended June 30, 2026 and 2025 ($ in thousands):
The following table summarizes the amounts recognized on our condensed consolidated statements of operations related to our interest rate caps for the three and six months ended June 30, 2026 and 2025 ($ in thousands):
In September 2023, we entered into an interest rate cap with a notional amount of $164.8 million that effectively limited SOFR from exceeding 4.00% and the maximum all-in coupon on our construction financing to 6.55%. During both the three and six months ended June 30, 2025, SOFR exceeded the cap rate of 4.00%. As such, we realized a gain from the interest rate cap in the amount of $0.1 million and $0.3 million during the three and six months ended June 30, 2025, respectively, which is included in gain (loss) on interest rate hedging instruments in our condensed consolidated statement of operations. In June 2024, we entered into an interest rate cap with an original maturity of July 1, 2025 and a notional amount of $73.7 million. During August 2025, we extended our interest rate cap to September 1, 2026. We used our interest rate cap to hedge our exposure to variable cash flows on our floating rate mortgage related to the D.C. Hotel. The interest rate cap effectively limited SOFR from exceeding 6.00% which resulted in the maximum all-in coupon on mortgage of 9.00%. During the three and six months ended June 30, 2026 and 2025, SOFR did not exceed the cap rate of 6.00%, and accordingly, no realized gain was recorded. The interest rate cap was terminated upon repayment of the mortgage during the three months ended June 30, 2026. No gain or loss was recognized upon termination. The following table summarizes the gross asset and liability amounts related to our derivatives at December 31, 2025 ($ in thousands):
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