Debt

During the three months ended September 30, 2017, Piedmont fully repaid the $140 Million WDC Fixed-Rate Loans prior to the maturity date without penalty and repaid the outstanding balance of the $500 Million Unsecured 2015 Line of Credit, using a portion of the net proceeds from the sale of the Two Independence Square building (see Note 9).

The following table summarizes the terms of Piedmont’s indebtedness outstanding as of September 30, 2017 and December 31, 2016 (in thousands):



Facility ⁽¹⁾	Stated Rate		Effective Rate ⁽²⁾			Maturity		Amount Outstanding as of
Facility ⁽¹⁾	Stated Rate		Effective Rate ⁽²⁾			Maturity		September 30, 2017		December 31, 2016
Secured (Fixed)
$140 Million WDC Fixed-Rate Loans	5.76	%	5.76	%		11/1/2017		$	—	$	140,000
$35 Million Fixed-Rate Loan ⁽³⁾	5.55	%	3.75	%		9/1/2021		30,903		31,583
$160 Million Fixed-Rate Loan ⁽⁴⁾	3.48	%	3.58	%		7/5/2022		160,000		160,000
Net premium and unamortized debt issuance costs								1,020		1,161
Subtotal/Weighted Average ⁽⁵⁾	3.82	%						191,923		332,744
Unsecured (Variable and Fixed)
$170 Million Unsecured 2015 Term Loan ⁽⁶⁾	LIBOR + 1.125%		2.37	%		5/15/2018		170,000		170,000
$300 Million Unsecured 2013 Term Loan	LIBOR + 1.20%		2.78	%	⁽⁷⁾	1/31/2019		300,000		300,000
$500 Million Unsecured 2015 Line of Credit ⁽⁶⁾	LIBOR + 1.00%		—	%		6/18/2019	⁽⁸⁾	—		178,000
$300 Million Unsecured 2011 Term Loan	LIBOR + 1.15%		3.35	%	⁽⁷⁾	1/15/2020		300,000		300,000
$350 Million Senior Notes	3.40	%	3.43	%		6/01/2023		350,000		350,000
$400 Million Senior Notes	4.45	%	4.10	%		3/15/2024		400,000		400,000
Discounts and unamortized debt issuance costs								(8,337)		(10,269)
Subtotal/Weighted Average ⁽⁵⁾	3.43	%						1,511,663		1,687,731
Total/Weighted Average ⁽⁵⁾	3.47	%						$	1,703,586	$	2,020,475


⁽¹⁾	Other than the $35 Million Fixed-Rate Loan, all of Piedmont’s outstanding debt as of September 30, 2017 and December 31, 2016 is interest-only.


⁽²⁾	Effective rate after consideration of settled or in-place interest rate swap agreements, issuance premiums/discounts, and/or fair market value adjustments upon assumption of debt.


⁽³⁾	Collateralized by the 5 Wall Street building in Burlington, Massachusetts.


⁽⁴⁾	Collateralized by the 1901 Market Street building in Philadelphia, Pennsylvania.


⁽⁵⁾	Weighted average is based on contractual balance of outstanding debt and the stated or effectively fixed interest rates in the table as of September 30, 2017.


⁽⁶⁾	On a periodic basis, Piedmont may select from multiple interest rate options, including the prime rate and various-length LIBOR locks. All LIBOR selections are subject to an additional spread over the selected rate based on Piedmont’s current credit rating.


⁽⁷⁾	Facility has a stated variable rate; however, Piedmont has entered into interest rate swap agreements which effectively fix, exclusive of Piedmont's credit rating, the rate shown as the effective rate.


⁽⁸⁾	Piedmont may extend the term for up to one additional year (through two available six month extensions to a final extended maturity date of June 18, 2020) provided Piedmont is not then in default and upon payment of extension fees.

Piedmont made interest payments on all debt facilities, including interest rate swap cash settlements, of approximately $18.0 million and $18.5 million for the three months ended September 30, 2017 and 2016, respectively, and approximately $54.0 million and $53.2 million for the nine months ended September 30, 2017 and 2016, respectively. Also, Piedmont capitalized interest of approximately $37,000 and $1.5 million for the three months ended September 30, 2017 and 2016, respectively, and approximately $0.2 million and $3.4 million for the nine months ended September 30, 2017 and 2016, respectively. As of September 30, 2017, Piedmont believes it was in compliance with all financial covenants associated with its debt instruments. See Note 6 for a description of Piedmont’s estimated fair value of debt as of September 30, 2017.