Mortgages and Notes Payable

12 Months Ended

Dec. 31, 2017

The Company had the following mortgages and notes payable outstanding as of December 31, 2017 and 2016:



	December 31, 2017			December 31, 2016
Mortgages and notes payable	$	697,068		$	745,173
Unamortized debt issuance costs	(7,258		)	(7,126		)
	$	689,810		$	738,047

Interest rates, including imputed rates on mortgages and notes payable, ranged from 2.2% to 7.8% at December 31, 2017 and the mortgages and notes payable mature between 2018 and 2036. Interest rates, including imputed rates, ranged from 2.2% to 7.8% at December 31, 2016. The weighted-average interest rate at December 31, 2017 and 2016 was approximately 4.6%.

In 2017, the Company's unsecured credit agreement with KeyBank National Association, as agent, was amended to, among other things, increase the overall facility to $1,105,000. With lender approval, the Company can increase the size of the amended facility to an aggregate of $2,010,000. A summary of the significant terms are as follows:



	Maturity Date	Current Interest Rate
$505,000 Revolving Credit Facility⁽¹⁾	August 2019	LIBOR + 1.00%
$300,000 Term Loan⁽²⁾⁽⁴⁾	August 2020	LIBOR + 1.10%
$300,000 Term Loan⁽³⁾⁽⁴⁾	January 2021	LIBOR + 1.10%


(1)	Increased from $400,000. Maturity date can be extended to August 2020 at the Company's option. The interest rate ranges from LIBOR plus 0.85% to 1.55%. At December 31, 2017, the revolving credit facility had $160,000 borrowings outstanding and availability of $345,000, subject to covenant compliance.


(2)	Increased from $250,000. The interest rate ranges from LIBOR plus 0.90% to 1.75%. The Company has aggregate interest-rate swap agreements to fix the LIBOR component at a weighted-average rate of 1.09% through February 2018 on $250,000 of the $300,000 outstanding LIBOR-based borrowings.


(3)	Increased from $255,000. The interest rate ranges from LIBOR plus 0.90% to 1.75%. The Company has aggregate interest-rate swap agreements to fix the LIBOR component at a weighted-average rate of 1.42% through January 2019 on $255,000 of the $300,000 outstanding LIBOR-based borrowings.


(4)	The aggregate unamortized debt issuance costs for the term loans were $3,337 and $3,907 as of December 31, 2017 and 2016, respectively.

The unsecured revolving credit facility and the unsecured term loans are subject to financial covenants, which the Company was in compliance with at December 31, 2017.

Mortgages payable and secured loans are generally collateralized by real estate and the related leases. Certain mortgages payable have yield maintenance or defeasance requirements relating to any prepayments.

Scheduled principal and balloon payments for mortgages, notes payable, credit facility borrowings and term loans for the next five years and thereafter are as follows:



Year ending December 31,	Total
2018	$	35,940
2019	270,448
2020	355,147
2021	340,465
2022	30,120
Thereafter	424,948
	1,457,068
Unamortized debt discounts	(10,595		)
	$	1,446,473

Included in the Consolidated Statements of Operations, the Company recognized debt satisfaction gains (charges), net, of $258, $(7) and $4,128 for the years ended December 31, 2017, 2016 and 2015, respectively, due to the satisfaction of mortgages and notes payable other than those disclosed elsewhere in these financial statements. In addition, the Company capitalized $1,174, $4,933 and $6,062 in interest for the years ended 2017, 2016 and 2015, respectively.

Senior Notes, Convertible Notes and Trust Preferred Securities

The Company had the following Senior Notes outstanding as of December 31, 2017 and 2016:



Issue Date	December 31, 2017			December 31, 2016			Interest Rate		Maturity Date	Issue Price
May 2014	$	250,000		$	250,000		4.40	%	June 2024	99.883	%
June 2013	250,000			250,000			4.25	%	June 2023	99.026	%
	500,000			500,000
Unamortized debt discount	(1,507		)	(1,780		)
Unamortized debt issuance cost	(3,295		)	(3,858		)
	$	495,198		$	494,362

Each series of the Senior Notes is unsecured and pays interest semi-annually in arrears. The Company may redeem the notes at its option at any time prior to maturity in whole or in part by paying the principal amount of the notes being redeemed plus a premium.

During 2010, the Company issued $115,000 aggregate principal amount of 6.00% Convertible Guaranteed Notes. The notes paid interest semi-annually in arrears and were scheduled to mature in January 2030. The notes were fully satisfied/converted in 2016. During 2016 and 2015, $12,400 and $3,828 aggregate principal amount of the notes were converted for 1,892,269 and 519,664 common shares and an aggregate cash payment of $672 and $529 plus accrued and unpaid interest, respectively. The Company recognized aggregate debt satisfaction charges of $436 and $476, during 2016 and 2015, respectively, relating to the conversions.

During 2007, the Company issued $200,000 original principal amount of Trust Preferred Securities. The Trust Preferred Securities, which are classified as debt, are due in 2037, are open for redemption at the Company's option, bore interest at a fixed rate of 6.804% through April 2017 and thereafter bear interest at a variable rate of three month LIBOR plus 170 basis points through maturity. The interest rate at December 31, 2017 was 3.078%. As of December 31, 2017 and 2016, there was $129,120 original principal amount of Trust Preferred Securities outstanding and $1,924 and $2,024, respectively, of unamortized debt issuance costs.

Scheduled principal payments for these debt instruments for the next five years and thereafter are as follows:



Year ending December 31,	Total
2018	$	—
2019	—
2020	—
2021	—
2022	—
Thereafter	629,120
	629,120
Unamortized debt discounts	(1,507		)
Unamortized debt issuance costs	(5,219		)
	$	622,394

LCIF [Member]

Debt Instrument [Line Items]

Mortgages and Notes Payable

Mortgages and Notes Payable and Co-Borrower Debt

The Partnership had the following mortgages and notes payable outstanding as of December 31, 2017 and 2016:



	December 31, 2017			December 31, 2016
Mortgages and notes payable	$	214,303		$	169,958
Unamortized debt issuance costs	(1,511		)	(746		)
	$	212,792		$	169,212

Interest rates, including imputed rates, ranged from 4.0% to 6.5% at December 31, 2017 and the mortgages and notes payable mature between 2019 and 2033. Interest rates, including imputed rates, ranged from 4.0% to 6.5% at December 31, 2016. The weighted-average interest rate at December 31, 2017 and 2016 was approximately 4.8% and 4.7%, respectively.

Lexington's, and the Partnership's as co-borrower, unsecured credit agreement with KeyBank National Association, as agent, was amended in 2017 to, among other things, increase the overall facility to $1,105,000. With lender approval, Lexington can increase the size of the amended facility to an aggregate $2,010,000. A summary of the significant terms are as follows:



	Maturity Date	Current Interest Rate
$505,000 Revolving Credit Facility⁽¹⁾	August 2019	LIBOR + 1.00%
$300,000 Term Loan⁽²⁾	August 2020	LIBOR + 1.10%
$300,000 Term Loan⁽³⁾	January 2021	LIBOR + 1.10%


(1)	Increased from $400,000. Maturity date can be extended to August 2020 at the Lexington's option. The interest rate ranges from LIBOR plus 0.85% to 1.55%. At December 31, 2017, the revolving credit facility had $160,000 of borrowings outstanding and availability of $345,000 subject to covenant compliance.


(2)	Increased from $250,000. The interest rate ranges from LIBOR plus 0.90% to 1.75%. Interest-rate swap agreements exist to fix the LIBOR component at a weighted-average rate of 1.09% through February 2018 on $250,000 of the $300,000 outstanding LIBOR-based borrowings.


(3)	Increased from $255,000. The interest rate ranges from LIBOR plus 0.90% to 1.75%. Interest-rate swap agreements exist to fix the LIBOR component at a weighted-average rate of 1.42% through January 2019 on $255,000 of the $300,000 outstanding LIBOR-based borrowings.

The unsecured revolving credit facility and the unsecured term loans are subject to financial covenants, which Lexington was in compliance with at December 31, 2017.

In accordance with the guidance of ASU 2013-04, the Partnership recognizes a proportion of the outstanding amounts of the above mentioned term loans and revolving credit facility as it is a co-borrower with Lexington, as co-borrower debt in the accompanying balances sheets. In accordance with the Partnership’s partnership agreement, the Partnership is allocated a portion of these debts based on gross rental revenues, which represents its agreed to obligation. The Partnership's allocated co-borrower debt was $157,789 and $146,404 as of December 31, 2017 and 2016, respectively. Changes in co-borrower debt are recognized in partners’ capital, exclusive of direct borrowings/payments, in the accompanying consolidated statements of changes in partners’ capital.

Scheduled principal and balloon payments for mortgages and notes payable and co-borrower debt for the next five years and thereafter are as follows:



Year ending December 31,	Total
2018	$	1,124
2019	65,767
2020	80,875
2021	70,864
2022	10,016
Thereafter	143,446
	$	372,092
Unamortized debt issuance costs	(1,511		)
	$	370,581

Included in the Consolidated Statements of Operations, the Partnership recognized debt satisfaction charges, net of $33 for the year ended 2015 due to the satisfaction of mortgages and notes payable. In addition, the Partnership capitalized $596, $954 and $152 in interest for the years ended 2017, 2016, and 2015, respectively.