Fair Value of Assets and Liabilities |
Fair Value of Assets and Liabilities The table below presents certain of our assets carried at fair value at March 31, 2018, categorized by the level of inputs, as defined in the fair value hierarchy under GAAP, used in the valuation of each asset. | | | | | | | | | | | | | | | | | | | | |
| | Fair Value at March 31, 2018 Using | | | | | Quoted Prices in | | | | | | | | | Active Markets for | | Significant Other | | Significant | | | Carrying Value at | | Identical Assets | | Observable Inputs | | Unobservable Inputs | Description | | March 31, 2018 | | (Level 1) | | (Level 2) | | (Level 3) | Recurring Fair Value Measurement Assets: | | | | | | | Investment in TA (1) | | $ | 12,312 |
| | $ | 12,312 |
| | $ | — |
| | $ | — |
| Investment in RMR Inc.(2) | | $ | 175,139 |
| | $ | 175,139 |
| | $ | — |
| | $ | — |
|
| | (1) | Our 3,420,000 common shares of TA, which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs). Our historical cost basis for these shares is $17,407 as of March 31, 2018. During the three months ended March 31, 2018, we recorded an unrealized loss of $1,710 to adjust the carrying value of our investment in TA shares to their fair value as of March 31, 2018. |
| | (2) | Our 2,503,777 shares of class A common stock of RMR Inc., which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs). Our historical cost basis for these shares is $66,374 as of March 31, 2018. During the three months ended March 31, 2018, we recorded an unrealized gain of $26,665 to adjust the carrying value of our investment in RMR Inc. shares to their fair value as of March 31, 2018. |
In addition to the investment securities included in the table above, our financial instruments include our cash and cash equivalents, restricted cash, rents receivable, revolving credit facility, term loan, senior notes and security deposits. At March 31, 2018 and December 31, 2017, the fair values of these additional financial instruments approximated their carrying values in our condensed consolidated balance sheets due to their short term nature or variable interest rates, except as follows: | | | | | | | | | | | | | | | | | | | | March 31, 2018 | | December 31, 2017 | | | Carrying | | Fair | | Carrying | | Fair | | | Value (1) | | Value | | Value (1) | | Value | Senior Unsecured Notes, due 2021 at 4.25% | | $ | 395,858 |
| | $ | 407,652 |
| | $ | 395,497 |
| | $ | 413,676 |
| Senior Unsecured Notes, due 2022 at 5.00% | | 494,701 |
| | 520,658 |
| | 494,398 |
| | 533,908 |
| Senior Unsecured Notes, due 2023 at 4.50% | | 499,145 |
| | 512,190 |
| | 499,104 |
| | 523,275 |
| Senior Unsecured Notes, due 2024 at 4.65% | | 347,586 |
| | 357,635 |
| | 347,484 |
| | 368,804 |
| Senior Unsecured Notes, due 2025 at 4.50% | | 345,227 |
| | 353,658 |
| | 345,055 |
| | 363,589 |
| Senior Unsecured Notes, due 2026 at 5.25% | | 341,108 |
| | 364,525 |
| | 340,826 |
| | 377,431 |
| Senior Unsecured Notes, due 2027 at 4.95% | | 393,325 |
| | 408,398 |
| | 393,137 |
| | 422,914 |
| Senior Unsecured Notes, due 2028 at 3.95% | | 388,748 |
| | 376,284 |
| | 388,461 |
| | 390,930 |
| Senior Unsecured Notes, due 2030 at 4.375% | | 386,593 |
| | 385,930 |
| | — |
| | — |
| Total financial liabilities | | $ | 3,592,291 |
| | $ | 3,686,930 |
| | $ | 3,203,962 |
| | $ | 3,394,527 |
|
| | (1) | Carrying value includes unamortized discounts and premiums and issuance costs. |
At March 31, 2018 and December 31, 2017, we estimated the fair values of our senior notes using an average of the bid and ask price of our then outstanding issuances of senior notes (Level 2 inputs).
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