Company: PEB
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0001474098-25-000119
Chunk: 35

Company: Pebblebrook Hotel Trust
Filing Date: 2025-07-29
Form: 10-Q
Item: Item 1
Chunk 35
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 (loss) and are subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings.The Company's interest rate swaps at June 30, 2025 and December 31, 2024 consisted of the following, by maturity date (dollars in thousands):Aggregate Notional Value as of Hedge TypeInterest Rate Range (SOFR)MaturityJune 30, 2025December 31, 2024Swap-cash flow3.22% - 3.25%October 2025$200,000 $200,000 Swap-cash flow1.33% - 1.36%February 2026290,000 290,000 Swap-cash flow3.02% - 3.03%October 2026200,000 200,000 Swap-cash flow3.29%October 2027165,000 165,000 Swap-cash flow3.54% - 3.55%May 2028100,000 — Total$955,000 $855,000 The Company records all derivative instruments at fair value in the accompanying consolidated balance sheets. Fair values of interest rate swaps and caps are determined using the standard market methodology of netting the discounted future fixed cash receipts/payments and the discounted expected variable cash payments/receipts. Variable interest rates used in the calculation of projected receipts and payments on the swaps are based on an expectation of future interest rates derived from observable market interest rate curves (Overnight Index Swap curves) and volatilities (Level 2 inputs). Derivatives expose the Company to credit risk in the event of non-performance by the counterparties under the terms of the interest rate hedge agreements. The Company incorporates these counterparty credit risks in its fair value measurements. The Company believes it minimizes the credit risk by transacting with major creditworthy financial institutions. 

As of June 30, 2025 and December 31, 2024, the Company's interest rate swap assets had an aggregate fair value of $7.4 million and $16.6 million, respectively. As of June 30, 2025 and December 31, 2024, the Company's interest rate swap liabilities had an aggregate fair value of $0.5 million and zero, respectively. Interest rate swap assets are included in prepaid expenses and other assets and interest rate swap liabilities are included in accounts payable, accrued expenses and other liabilities in the accompanying consolidated balance sheets.