Debt Obligations

Debt obligations consist of the following (dollars in thousands):



	June 30, 2017			September 30, 2016
Mortgages payable (a)	$	698,091		$	621,382
Junior subordinated notes	37,400			37,400
Deferred mortgage costs	(7,141		)	(6,275		)
Total debt obligations, net of deferred costs	$	728,350		$	652,507

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(a) Excludes mortgages payable held for sale of $27,052,000 at September 30, 2016.

Mortgages Payable

During the nine months ended June 30, 2017, the Company obtained the following mortgage debt in connection with the following property acquisitions (dollars in thousands):

Location

Closing Date

Acquisition Mortgage Debt

Interest Rate

Interest only period

Maturity Date

Fredricksburg, VA

11/4/16

27,639

3.68

N/A

February 2027

Fredricksburg, VA

11/4/16

2,261

4.84

N/A

February 2027

St. Louis, MO

2/28/17

20,000

4.79

6 years

March 2027

St. Louis, MO

2/28/17

6,200

4.84

6 years

March 2027

Creve Coeur, MO

4/4/17

29,000

LIBOR + 2.50%

N/A

July 2018

(a)

Farmers Branch, TX

6/29/17

55,200

4.22

5 years

July 2028

140,300

(a) Mortgage contains nine month extension option.

During the nine months ended June 30, 2017, the Company obtained supplemental fixed rate mortgage financing as set forth in the table below (dollars in thousands):



Location	Closing Date	Supplemental Mortgage Debt		Interest Rate		Maturity Date
Decatur, GA	5/30/17	$	4,941	5.32	%	December 2022

The Company has two construction loans that have been, or will be, used to finance two separate construction projects. Information regarding these loans at June 30, 2017 is set forth below(dollars in thousand):

Location

Closing Date

Maximum Loan Amount

Amount outstanding

Interest Rate

Maturity Date

Extension Option

N Charleston, SC (1)

10/13/2015

30,265

27,289

LIBOR + 1.70%

10/13/2019

1 year

Nashville,TN

6/2/2017

47,426

—

LIBOR + 2.85%

6/2/2020

N/A

77,691

27,289

(1) This property is currently in lease up.

Junior Subordinated Notes

At June 30, 2017 and September 30, 2016, the Company's junior subordinated notes had an outstanding principal balance of $37,400,000, before deferred financing costs of $387,000 and $402,000, respectively. At June 30, 2017, the interest rate on the outstanding balance is three month LIBOR + 2.00% or 3.17%.

The junior subordinated notes require interest only payments through the maturity date of April 30, 2036, at which time repayment of the outstanding principal and unpaid interest become due. Interest expense, including the amortization of deferred costs, for the three months ended June 30, 2017 and 2016, was $300,000 and $322,000, respectively, and for the nine months ended June 30, 2017 and 2016, was $862,000 and $1,248,000, respectively.