NOTES PAYABLE

6 Months Ended

Jun. 30, 2024

Debt Disclosure [Abstract]

NOTES PAYABLE

NOTES PAYABLE

Wells Fargo Line of Credit

On January 27, 2023, the Company, as guarantor, and certain of the wholly owned subsidiaries of the Operating Partnership, as co-borrowers, amended and restated its secured revolving credit facility (the “Wells Fargo Line of Credit”) with Wells Fargo Bank, National Association, as administrative agent, and other lending institutions that may become parties to the credit agreement. thereby changing certain terms and provisions, including extending the maturity date to February 28, 2025. The Wells Fargo Line of Credit had a maximum capacity of $100,000 and is expandable by the Company up to a maximum capacity of $250,000 upon satisfaction of specified conditions. Each requested expansion must be for at least $25,000 and may result in the Wells Fargo Line of Credit being syndicated. The interest rate under the Wells Fargo Line of Credit was based on the 30-day average of the secured overnight financing rate ("SOFR") with a spread of 200 or 225 basis points depending on the debt yield as defined in the agreement.

On September 1, 2023, the Company added its Commerce Corner property ("Commerce Corner") to the Wells Fargo Line of Credit thereby adding RPT 1109 Commerce Corner, LLC, as a borrower under the Wells Fargo Line of Credit.

On September 7, 2023, RPT 1109 Commerce Corner entered into a guaranteed maximum price contract to expand the Company's property located at 1109 Commerce Boulevard, Logan Township, New Jersey ("Commerce Corner") by approximately 141,000 square feet (the "Commerce Expansion"). Commerce Corner is a 259,910 rentable square-foot, 100% leased multi-tenant warehouse and distribution center acquired by the Company in 2014. The Commerce Expansion is expected to cost approximately $29,000 and construction commenced in October 2023. The Commerce Expansion is being undertaken to accommodate the growth initiatives of Performance Food Group (NYSE: PFGC), who has entered into a 15-year lease with RPT 1109 Commerce to take possession of the Commerce Expansion space upon its substantial completion. In connection therewith, Performance Food Group's lease for its existing space at Commerce Corner has been extended to be coterminous, bringing Performance Food Group's footprint to approximately 301,000 square feet once the Commerce Expansion is complete.

On December 27, 2023, the wholly owned subsidiaries of the Operating Partnership which were borrowers under the Wells Fargo Line of Credit entered into a third amendment to the Wells Fargo Line of Credit (the “Third Amendment”). The Third Amendment added CIBC Inc. ("CIBC") to the credit facility as an additional lender; increased the maximum commitment amount from $100,000 to $120,000; allocated the maximum commitment amount between the Revolving Commitment and the Construction Commitment (each, as defined under the Wells Fargo Line of Credit); and revised or suspended certain covenants. The maximum commitment amount of $120,000 is bifurcated as follows: $75,600 to the Revolving Commitment and $44,400 to the Construction Commitment. The Revolving Commitment and Construction Commitment will both be allocated 70.83% to Wells Fargo and 29.17% to CIBC. Pursuant to the Third Amendment, the Wells Fargo Line of Credit incurs interest based on the 30-day average of the SOFR plus a spread of 225 basis points. In addition, the term was extended from February 28, 2025 to December 27, 2025. The Company serves as guarantor to the Wells Fargo Line of Credit.

For the Revolving Commitment, as of June 30, 2024 and December 31, 2023, the borrowers' maximum borrowing capacity was $44,545 and $47,616, respectively, and the borrowers' outstanding balance was $40,824 and $34,624, respectively. For the Construction Commitment, as of June 30, 2024 and December 31, 2023, the borrowers' maximum borrowing capacity was $44,400, and the borrowers' outstanding balance was $31,628 and $21,341, respectively.The remaining unfunded portion of the Construction Commitment will be used to fully fund the remaining costs of the Commerce Expansion. As of June 30, 2024 and December 31, 2023, the weighted average interest rate was 7.57% and 7.58%, respectively.

At any time, the borrowing capacity under the Wells Fargo Line of Credit for the Revolving Commitment is based on the lesser of (1) an amount equal to 65% of the aggregate value of the properties in the collateral pool as determined by lender appraisals, (2) an amount that results in a minimum debt yield of 9.5% based on the in-place net operating income of the collateral pool as defined, or (3) the maximum capacity of the Revolving Commitment. Proceeds from the Revolving Commitment can be used to fund acquisitions, redeem shares pursuant to the Company's redemption plan and for any other corporate purpose. Proceeds from the Construction Commitment can be used only to fund construction activities related to the Commerce Expansion.

The Wells Fargo Line of Credit agreement contains customary representations, warranties, borrowing conditions and affirmative, negative and financial covenants, including that there must be four properties in the collateral pool at all times, and that the collateral pool also meet specified concentration provisions, unless waived by the lender. In connection with the Commerce Expansion, Commerce Corner will not be included in the borrowing base during the construction period. Upon completion of the Commerce Expansion, Commerce Corner will become a borrowing base property. In addition, the Company, as guarantor, must meet tangible net worth hurdles. The Company was in compliance with all applicable financial covenants as of June 30, 2024.

The following is a reconciliation of the carrying amount of the Wells Fargo Line of Credit at June 30, 2024 and December 31, 2023.

	Balance at
Lender	June 30, 2024		December 31, 2023
Wells Fargo/CIBC	$	72,452	$	55,965
Deduct: Deferred financing costs, less accumulated amortization	(1,222)		(1,630)
Line of credit, net	$	71,230	$	54,335

Mortgage Loans

Certain wholly owned subsidiaries of the Company are obligors on various mortgage loans. Such mortgage loans contain fixed interest rates, allow for one-time transfer to another borrower subject to lender discretion and payment of applicable fees, and allow for full prepayment at certain times with payment of applicable penalties, if any. The following is a reconciliation of the carrying amount of the mortgage loans payable at June 30, 2024 and December 31, 2023.

		Balance at
Lender	Encumbered Property	June 30, 2024		December 31, 2023		Interest Rate		Maturity Date
State Farm Life Insurance Company	Elston Plaza	16,643		16,816		3.89	%	July 1, 2026
Massachusetts Mutual Life Insurance Company	The Glenn	66,000		66,000		3.02		December 1, 2028
Transamerica Life Insurance Company	Wallingford Plaza	6,549		6,612		4.56		January 1, 2029
Nationwide Life Insurance Company	Providence Square	29,700		29,700		3.67		October 5, 2029
JPMorgan Chase Bank	Seattle East Industrial	45,140		45,140		3.87		January 1, 2030
Nationwide Life Insurance Company	The Flats at Carrs Hill	25,500		25,500		5.51		July 1, 2030
		$	189,532	$	189,768
Deduct: Deferred financing costs, less accumulated amortization		(744)		(824)
Mortgage loans payable, net		$	188,788	$	188,944

Aggregate future principal payments due on the Wells Fargo Line of Credit and mortgage loans payable as of June 30, 2024 are as follows:

Year	Amount
Remainder of 2024	$	239
2025	72,944
2026	16,247
2027	145
2028	72,069
Thereafter	100,340
Total	$	261,984