Debt

Senior Unsecured Credit Facility

As of December 31, 2016, we had a senior credit facility that provided for a $1.5 billion unsecured revolving credit facility, or our Revolver, and a $250.0 million term loan facility, or our Term Loan Facility, which we refer to collectively as the Senior Unsecured Credit Facility. The Senior Unsecured Credit Facility also contained a $500.0 million accordion feature that, if exercised, subject to lender commitments, would have allowed us to increase our maximum borrowing capacity under our Revolver from $1.5 billion to $2.0 billion and under the Senior Unsecured Credit Facility in the aggregate to $2.25 billion. At December 31, 2016, the Senior Unsecured Credit Facility also permitted (i) up to $750.0 million under our Revolver to be borrowed in certain currencies other than the U.S. dollar, (ii) swing line loans up to $50.0 million under our Revolver, and (iii) the issuance of letters of credit under our Revolver in an aggregate amount not to exceed $50.0 million. The Senior Unsecured Credit Facility is being used for working capital needs, to refinance our existing indebtedness, for new investments, and for other general corporate purposes.

We exercised a prior accordion feature for the Senior Unsecured Credit Facility on January 15, 2015, which allowed us to increase the maximum borrowing capacity of our Revolver from $1.0 billion to $1.5 billion. In connection with the exercise of this accordion feature, we incurred financing costs totaling $3.1 million, which are being amortized to Interest expense in the consolidated financial statements over the remaining terms of the facility.

At December 31, 2016, our Revolver had unused capacity of $823.3 million, excluding amounts reserved for outstanding letters of credit. As of December 31, 2016, our lenders had issued letters of credit totaling $0.6 million on our behalf in connection with certain contractual obligations, which reduce amounts that may be drawn under our Revolver by the same amount. We also incur a facility fee of 0.20% of the total commitment on our Revolver. On January 29, 2016, we exercised our option to extend our Term Loan Facility by an additional year to January 31, 2017. On January 26, 2017, we exercised our second and final option to extend our Term Loan Facility by an additional year to January 31, 2018 (Note 20). At December 31, 2016, we also had an option to extend the maturity date of the Revolver by another year, subject to the conditions provided in the Second Amended and Restated Credit Agreement dated January 31, 2014, as amended, or the Credit Agreement. On February 22, 2017, we amended and restated our Senior Unsecured Credit Facility. We increased the capacity of our unsecured line of credit under our Amended Credit Facility to $1.85 billion, and extended the maturity dates of our revolving line of credit by four years and our term loan by five years (Note 20).

The following table presents a summary of our Senior Unsecured Credit Facility (dollars in millions):



	Interest Rate at December 31, 2016 ^(a)		Principal Outstanding Balance at December 31,
Senior Unsecured Credit Facility	Interest Rate at December 31, 2016 ^(a)	Maturity Date	2016		2015
Revolver:
Revolver - borrowing in U.S. dollars ^(b)	LIBOR + 1.10%	1/31/2018	$	390.0	$	92.0
Revolver - borrowing in euros ^{(b) (c)}	EURIBOR + 1.10%	1/31/2018	286.7		393.0
			676.7		485.0
Term Loan Facility ^{(b) (d)}	LIBOR + 1.25%	1/31/2017	250.0		250.0
			$	926.7	$	735.0

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(a)	Interest rate at December 31, 2016 is based on our credit rating of BBB/Baa2.

(b)

Our Term Loan Facility was scheduled to mature on January 31, 2017. However, on January 26, 2017, we exercised our option to extend the maturity of our Term Loan Facility by an additional year to January 31, 2018 (Note 20). In addition, on February 22, 2017, we entered into our Amended Credit Facility and increased the capacity of our unsecured line of credit to $1.85 billion, and extended the maturity dates of our revolving line of credit by four years and our term loan by five years (Note 20).


(c)	EURIBOR means Euro Interbank Offered Rate.


(d)	Balance excludes unamortized deferred financing costs of less than $0.1 million and $0.3 million at December 31, 2016 and 2015, respectively (Note 2).

Senior Unsecured Notes

As of December 31, 2016, the senior unsecured notes set forth in the table below had an outstanding aggregate principal balance of $1.8 billion. We refer to these notes and our €500.0 million of 2.25% Senior Notes, as described below and in Note 20, collectively as the Senior Unsecured Notes.

On September 12, 2016, we issued $350.0 million of 4.25% Senior Notes, at a price of 99.682% of par value, in a registered public offering. These 4.25% Senior Notes have a ten-year term and are scheduled to mature on October 1, 2026.

Interest on the Senior Unsecured Notes is payable annually in arrears for our euro-denominated notes and semi-annually for U.S. dollar-denominated notes. The Senior Unsecured Notes can be redeemed at par within three months of their respective maturities, or we can call the notes at any time for the principal, accrued interest, and a make-whole amount based upon the applicable government bond yield plus 30 to 35 basis points. The following table presents a summary of our Senior Unsecured Notes (currency in millions):



		Principal Amount		Price of Par Value		Original Issue Discount		Effective Interest Rate		Coupon Rate		Maturity Date	Principal Outstanding Balance at December 31,
Senior Unsecured Notes, net ^(a)	Issue Date	Principal Amount		Price of Par Value		Original Issue Discount		Effective Interest Rate		Coupon Rate		Maturity Date	2016		2015
2.0% Senior Notes	1/21/2015	€	500.0	99.220	%	$	4.6	2.107	%	2.0	%	1/20/2023	$	527.1	$	544.4
4.6% Senior Notes	3/14/2014	$	500.0	99.639	%	$	1.8	4.645	%	4.6	%	4/1/2024	500.0		500.0
4.0% Senior Notes	1/26/2015	$	450.0	99.372	%	$	2.8	4.077	%	4.0	%	2/1/2025	450.0		450.0
4.25% Senior Notes	9/12/2016	$	350.0	99.682	%	$	1.1	4.290	%	4.3	%	10/1/2026	350.0		—
													$	1,827.1	$	1,494.4

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(a)	Aggregate balance excludes unamortized deferred financing costs totaling $12.1 million and $10.5 million (Note 2) at December 31, 2016 and 2015, respectively, and unamortized discount totaling $7.8 million at both December 31, 2016 and 2015.

Proceeds from the issuances of these notes were used primarily to partially pay down the amounts then outstanding under our Revolver. In connection with these offerings, we incurred financing costs totaling $3.1 million, $7.8 million, and $4.2 million during the years ended December 31, 2016, 2015, and 2014 respectively, which are included in Senior Unsecured Notes, net in the consolidated financial statements in accordance with our adoption of ASU 2015-03 (Note 2), and are being amortized to Interest expense over the respective terms of the Senior Unsecured Notes.

On January 19, 2017, we completed a public offering of €500.0 million of 2.25% Senior Notes, at a price of 99.448% of par value, issued by our wholly owned subsidiary, WPC Eurobond B.V., which are guaranteed by us. These 2.25% Senior Notes have a 7.5-year term and are scheduled to mature on July 19, 2024 (Note 20).

Covenants

The Senior Unsecured Credit Facility and the Senior Unsecured Notes include customary financial maintenance covenants that require us to maintain certain ratios and benchmarks at the end of each quarter. The Senior Unsecured Credit Facility also contains various customary affirmative and negative covenants applicable to us and our subsidiaries, subject to materiality and other qualifications, baskets, and exceptions as outlined in the Credit Agreement.

We are required to ensure that the total Restricted Payments (as defined in the Credit Agreement) in an aggregate amount in any fiscal year does not exceed the greater of (i) 95% of Adjusted Funds from Operations (as defined in the Credit Agreement) and (ii) the amount of Restricted Payments required in order for us to maintain our REIT status. Restricted Payments include quarterly dividends and the total amount of shares repurchased by us, if any, in excess of $100.0 million per year.

Obligations under the Senior Unsecured Credit Facility may be declared immediately due and payable upon the occurrence of certain events of default as defined in the Credit Agreement, including failure to pay any principal when due and payable, failure to pay interest within five business days after becoming due, failure to comply with any covenant, representation or condition of any loan document, any change of control, cross-defaults, and certain other events as set forth in the Credit Agreement, with grace periods in some cases.

The Credit Agreement stipulates several financial covenants that require us to maintain certain ratios and benchmarks at the end of each quarter as defined in the Credit Agreement. In connection with entering into our Amended Credit Facility on February 22, 2017 (Note 20), we obtained a waiver from our lenders stating that we were not required to certify that we were in compliance with these financial covenants under the Credit Agreement. However, as of December 31, 2016, we were in compliance with the financial covenants contained within the Amended Credit Facility agreement.

Non-Recourse Debt

Non-recourse debt consists of mortgage notes payable, which are collateralized by the assignment of real estate properties. For a list of our encumbered properties, please see Schedule III — Real Estate and Accumulated Depreciation. At December 31, 2016, our mortgage notes payable bore interest at fixed annual rates ranging from 2.0% to 7.8% and variable contractual annual rates ranging from 0.9% to 6.9%, with maturity dates ranging from January 2017 to June 2027.

During the year ended December 31, 2016, we prepaid non-recourse mortgage loans totaling $321.7 million, including a mortgage loan of $50.8 million encumbering a property that was sold in August 2016 (Note 17). In connection with these payments, we recognized a loss on extinguishment of debt of $4.1 million during the year ended December 31, 2016, which was included in Other income and (expenses) in the consolidated financial statements. In addition, we made a balloon payment of $31.9 million at maturity on a non-recourse mortgage loan encumbering a portfolio of international properties and a balloon payment of $18.5 million at maturity on another non-recourse mortgage loan during 2016. See Note 20, Subsequent Events.

On July 29, 2016, a jointly owned investment with CPA^®:17 – Global, which we consolidate, refinanced a non-recourse mortgage loan that had an outstanding balance of $33.8 million with new financing of $34.6 million, inclusive of the amount attributable to a noncontrolling interest of $17.0 million. The previous loan had an interest rate of 5.9% and a maturity date of July 31, 2016. The new loan has a rate of EURIBOR plus a 3.3% margin and a term of five years.

Interest Paid

For the years ended December 31, 2016, 2015, and 2014, interest paid was $182.2 million, $174.5 million, and $156.3 million, respectively.

Foreign Currency Exchange Rate Impact

During the year ended December 31, 2016, the U.S. dollar strengthened against the euro and British pound sterling, resulting in an aggregate decrease of $45.2 million in the aggregate carrying values of our Non-recourse debt, Senior Unsecured Credit Facility - Revolver, and Senior Unsecured Notes, net from December 31, 2015 to December 31, 2016.

Scheduled Debt Principal Payments

Scheduled debt principal payments during each of the next five calendar years following December 31, 2016 and thereafter through 2027 are as follows (in thousands):



Years Ending December 31,	Total ^(a)
2017	$	768,480
2018	940,391
2019	99,566
2020	217,044
2021	156,985
Thereafter through 2027	2,279,751
Total principal payments	4,462,217
Deferred financing costs ^(b)	(13,403		)
Unamortized discount, net ^(c)	(8,000		)
Total	$	4,440,814

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(a)	Certain amounts are based on the applicable foreign currency exchange rate at December 31, 2016.


(b)	In accordance with ASU 2015-03, we reclassified deferred financing costs from Other assets, net to Non-recourse debt, net, Senior Unsecured Notes, net, and Senior Unsecured Credit Facility - Term Loan, net as of December 31, 2015 (Note 2).


(c)	Represents the unamortized discount on the Senior Unsecured Notes totaling $7.8 million and the unamortized discount of $0.2 million in the aggregate resulting from the assumption of property-level debt in connection with the CPA^®:15 Merger and CPA^®:16 Merger.