Mortgage Notes Payable:

Mortgage notes payable at September 30, 2018 and December 31, 2017 consist of the following:



	Carrying Amount of Mortgage Notes(1)
	September 30, 2018				December 31, 2017
Property Pledged as Collateral	Related Party		Other		Related Party		Other		Effective Interest Rate(2)		Monthly Debt Service(3)		Maturity Date(4)
Chandler Fashion Center(5)	$	—	$	199,954	$	—	$	199,904	3.77	%	$	625	2019
Danbury Fair Mall	101,977		101,977		104,599		104,598		5.53	%	1,538		2020
Fashion Outlets of Chicago(6)	—		199,541		—		199,298		3.76	%	600		2020
Fashion Outlets of Niagara Falls USA	—		110,448		—		112,770		4.89	%	727		2020
Freehold Raceway Mall(5)	—		398,171		—		398,050		3.94	%	1,300		2029
Fresno Fashion Fair	—		323,410		—		323,261		3.67	%	971		2026
Green Acres Commons(7)	—		127,776		—		107,219		4.81	%	460		2021
Green Acres Mall	—		286,386		—		291,366		3.61	%	1,447		2021
Kings Plaza Shopping Center	—		439,695		—		447,231		3.67	%	2,229		2019
Oaks, The	—		193,229		—		196,732		4.14	%	1,064		2022
Pacific View	—		122,132		—		124,397		4.08	%	668		2022
Queens Center	—		600,000		—		600,000		3.49	%	1,744		2025
Santa Monica Place(8)	—		296,882		—		296,366		3.76	%	865		2022
SanTan Village Regional Center	—		122,376		—		124,703		3.14	%	589		2019
Towne Mall	—		20,842		—		21,161		4.48	%	117		2022
Tucson La Encantada	65,770		—		66,970		—		4.23	%	368		2022
Victor Valley, Mall of	—		114,660		—		114,617		4.00	%	380		2024
Vintage Faire Mall	—		259,635		—		263,818		3.55	%	1,256		2026
Westside Pavilion(9)	—		—		—		141,020
	$	167,747	$	3,917,114	$	171,569	$	4,066,511

(1)

The mortgage notes payable balances includes an unamortized debt premium. Debt premiums represent the excess of the fair value of debt over the principal value of debt assumed in various acquisitions and are amortized into interest expense over the remaining term of the related debt in a manner that approximates the effective interest method. The loan on Fashion Outlets of Niagara Falls USA had a premium of $1,934 and $2,630 at September 30, 2018 and December 31, 2017, respectively.

The mortgage notes payable also include unamortized deferred finance costs that are amortized into interest expense over the remaining term of the related debt in a manner that approximates the effective interest method. Unamortized deferred finance costs were $14,232 and $17,838 at September 30, 2018 and December 31, 2017, respectively.


(2)	The interest rate disclosed represents the effective interest rate, including the impact of debt premium and deferred finance costs.


(3)	The monthly debt service represents the payment of principal and interest.


(4)	The maturity date assumes that all extension options are fully exercised and that the Company does not opt to refinance the debt prior to these dates. These extension options are at the Company's discretion, subject to certain conditions, which the Company believes will be met.


(5)	A 49.9% interest in the loan has been assumed by a third party in connection with the Company's joint venture in Chandler Freehold (See Note 11—Financing Arrangement).


(6)	The loan bears interest at LIBOR plus 1.50%. At September 30, 2018 and December 31, 2017, the total interest rate was 3.76% and 3.02%, respectively.


(7)	On March 1, 2018, the Company borrowed the remaining $20,000 available under the loan agreement on the property. The loan bears interest at LIBOR plus 2.15%. At September 30, 2018 and December 31, 2017, the total interest rate was 4.81% and 4.07%, respectively.


(8)	The loan bears interest at LIBOR plus 1.35%. The loan is covered by an interest rate cap agreement that effectively prevents LIBOR from exceeding 4.0% during the period ending December 9, 2019 (See Note 5—Derivative Instruments and Hedging Activities). At September 30, 2018 and December 31, 2017, the total interest rate was 3.76% and 3.13%, respectively.


(9)	On August 31, 2018, a 75% interest in the loan was assumed by a third party in connection with the sale of a 75% ownership interest in the underlying property (See Note 4—Investments in Unconsolidated Joint Ventures).

Most of the mortgage loan agreements contain a prepayment penalty provision for the early extinguishment of the debt.

The Company's mortgage notes payable are secured by the properties on which they are placed and are non-recourse to the Company.

The Company expects that all loan maturities during the next twelve months will be refinanced, restructured, extended and/or paid-off from the Company's line of credit or with cash on hand.

Total interest expense capitalized was $3,751 and $3,428 for the three months ended September 30, 2018 and 2017, respectively, and $12,752 and $9,405 for the nine months ended September 30, 2018 and 2017, respectively.

Related party mortgage notes payable are amounts due to an affiliate of NML. See Note 17—Related Party Transactions for interest expense associated with loans from NML.

The estimated fair value (Level 2 measurement) of mortgage notes payable at September 30, 2018 and December 31, 2017 was $4,088,227 and $4,250,816, respectively, based on current interest rates for comparable loans. Fair value was determined using a present value model and an interest rate that included a credit value adjustment based on the estimated value of the property that serves as collateral for the underlying debt.