OTES PAYABLE

The following table summarizes the terms of notes payable outstanding at December 31, 2014 and 2013 ($ in thousands):



Description	Interest Rate	Maturity	2014		2013
Post Oak Central mortgage note	4.26%	2020	185,109		188,310
Credit Facility, unsecured	1.27%	2019	140,200		40,075
The American Cancer Society Center mortgage note	6.45%	2017	131,083		132,714
Promenade mortgage note	4.27%	2022	110,946		113,573
191 Peachtree Tower mortgage note	3.35%	2018	100,000		100,000
816 Congress mortgage note	3.75%	2024	85,000		—
Meridian Mark Plaza mortgage note	6.00%	2020	25,408		25,813
The Points at Waterview mortgage note	5.66%	2016	14,598		15,139
Mahan Village LLC construction facility	1.80%	—	—		14,470
			$	792,344	$	630,094

Credit Facility

In 2014, the Company modified its $350 million senior unsecured line of credit by entering into the Third Amended and Restated Credit Agreement (the “New Facility”), which replaced the Second Amended and Restated Credit Agreement dated February 28, 2012 (the “Existing Facility"). The New Facility amended the Existing Facility by:


•	Increasing the size by $150 million to $500 million;


•	Extending the maturity date from February 28, 2016 to May 28, 2019;


•	Reducing the per annum variable interest rate and other fees; and


•	Providing for the expansion of the New Facility by an additional $250 million for a total available of $750 million, subject to receipt of additional commitments from lenders and other customary conditions.

The New Facility contains financial covenants that require, among other things, the maintenance of an unencumbered interest coverage ratio of at least 2.00; a fixed charge coverage ratio of at least 1.50; an overall leverage ratio of no more than 60%; and a minimum shareholders' equity in an amount equal to $1.0 billion, plus a portion of the net cash proceeds from certain equity issuances. The New Facility also contains customary representations and warranties and affirmative and negative covenants, as well as customary events of default. The amounts outstanding under the New Facility may be accelerated upon the occurrence of any events of default.

The interest rate applicable to the New Facility varies according to the Company’s leverage ratio, and may, at the election of the Company, be determined based on either (1) the current London Interbank Offered Rate (LIBOR) plus the applicable spread as detailed below or (2) the greater of Bank of America's prime rate, the federal funds rate plus 0.50% or the one-month LIBOR plus 1.0% (the “Base Rate”), plus the applicable spread as detailed below. Fees on letters of credit issued under the New Facility are payable at an annual rate equal to the spread applicable to loans bearing interest based on LIBOR. The Company also pays an annual facility fee on the total commitments under the New Facility. The pricing spreads and the facility fee under the New Facility are as follows:



Leverage Ratio	Applicable % Spread for LIBOR	Applicable % Spread for Base Rate	Annual Facility Fee %

≤ 30%	1.10%	0.10%	0.15%
>30% but ≤ 35%	1.10%	0.10%	0.20%
>35% but ≤ 40%	1.15%	0.15%	0.20%
>40% but ≤ 45%	1.20%	0.20%	0.20%
>45% but ≤ 50%	1.20%	0.20%	0.25%
>50%	1.45%	0.45%	0.30%

At December 31, 2014, the Credit Facility's spread over LIBOR was 1.1%. The amount that the Company may draw under the Credit Facility is a defined calculation based on the Company's unencumbered assets and other factors. The total available borrowing capacity under the Credit Facility was $359.8 million at December 31, 2014, and the Credit Facility is recourse to the Company.

Other Debt Information

In 2014, the Company entered into a $85.0 million non-recourse mortgage note payable secured by 816 Congress. The mortgage note has a fixed rate of 3.75% and matures in November 2024. The Company also sold Mahan Village which was owned in a consolidated joint venture, and repaid the accompanying construction facility without penalty.

The real estate and other assets of The American Cancer Society Center (the “ACS Center”) are restricted under the ACS Center loan agreement in that they are not available to settle debts of the Company. However, provided that the ACS Center loan has not incurred any uncured event of default, as defined in the loan agreement, the cash flows from the ACS Center, after payments of debt service, operating expenses and reserves, are available for distribution to the Company.

The majority of the Company’s consolidated debt is fixed-rate long-term non-recourse mortgage notes payable. Assets with depreciated carrying values of $680.9 million were pledged as security on the $652.1 million mortgage notes payable. As of December 31, 2014, the weighted average maturity of the Company’s consolidated debt was 5.4 years.

At December 31, 2014 and 2013, the estimated fair value of the Company’s notes payable was $835.4 million and $654.1 million, respectively, calculated by discounting the debt's remaining contractual cash flows at estimated rates at which similar loans could have been obtained at December 31, 2014 and 2013. The estimate of the current market rate, which is the most significant input in the discounted cash flow calculation, is intended to replicate debt of similar maturity and loan-to-value relationship. These fair value calculations are considered to be Level 2 under the guidelines as set forth in ASC 820 as the Company utilizes market rates for similar type loans from third party brokers.

For the years ended December 31, 2014, 2013, and 2012, interest was recorded as follows (in thousands):



	2014			2013			2012
Total interest incurred	$	31,862		$	22,227		$	25,570
Interest capitalized	(2,752		)	(518		)	(1,637		)
Total interest expense	$	29,110		$	21,709		$	23,933

Debt Maturities

Future principal payments due on the Company's notes payable at December 31, 2014 are as follows (in thousands):



2015	$	8,825
2016	24,095
2017	138,195
2018	105,734
2019	149,647
Thereafter	365,848
	$	792,344