Annual report [Section 13 and 15(d), not S-K Item 405]

Interest Rate Derivatives

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
 
The following table sets forth the key terms and fair values of our interest rate swap derivatives (dollars in thousands):
Notional Amount Effective Date Expiration Date Fair Value at December 31,
  Fixed Rate Floating Rate Index 2025 2024
$ 150,000  3.742 % One-Month SOFR 2/1/2023 2/2/2026 $ (5) $ 550 
$ 50,000  3.747 % One-Month SOFR 2/1/2023 2/2/2026 (2) 181 
$ 10,160  (1) 1.678 %
SOFR + 0.10%
 8/1/2019 8/1/2026 114  387 
$ 22,100  0.573 %
SOFR + 0.10%
 4/1/2020 3/26/2025 —  197 
            $ 107  $ 1,315 
(1)The notional amount of this instrument is scheduled to amortize to $10.0 million.

Each of these swaps was designated as a cash flow hedge of interest rate risk.

The table below sets forth the fair value of our interest rate derivatives as well as their classification on our consolidated balance sheets (in thousands):
Fair Value at December 31,
Derivatives Balance Sheet Location 2025 2024
Interest rate swaps designated as cash flow hedges Prepaid expenses and other assets, net $ 114  $ 1,315 
Interest rate swaps designated as cash flow hedges Other liabilities $ (7) $ — 
 
The table below presents the effect of our interest rate derivatives on our consolidated statements of operations and comprehensive income (in thousands):
Amount of Income Recognized in AOCI on Derivatives Amount of Income Reclassified from AOCI into Interest Expense on Statement of Operations
For the Years Ended December 31, For the Years Ended December 31,
Derivatives in Hedging Relationships 2025 2024 2023 2025 2024 2023
Interest rate derivatives $ 283  $ 3,087  $ 3,827  $ 1,491  $ 4,330  $ 3,900 

Based on the fair value of our derivatives as of December 31, 2025, we estimate that approximately $107,000 of net gains will be reclassified from AOCI as a decrease to interest expense over the next 12 months.

We have agreements with each of our interest rate derivative counterparties that contain provisions under which, if we default or are capable of being declared in default on defined levels of our indebtedness, we could also be declared in default on
our derivative obligations.  Failure to comply with the loan covenant provisions could result in our being declared in default on any derivative instrument obligations covered by the agreements.  As of December 31, 2025, we were not in default with any of these provisions.  As of December 31, 2025, the fair value of interest rate derivatives in a liability position related to these agreements was $7,000, excluding the effects of accrued interest and credit valuation adjustments. As of December 31, 2025, we had not posted any collateral related to these agreements.