Company: VRE
Filing Date: 2025-04-23
Form Type: 10-Q
Source: 0000924901-25-000028
Chunk: 93

Company: Veris Residential, Inc.
Filing Date: 2025-04-23
Form: 10-Q
Item: Part I, Item 8
Chunk 93
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6,296Deferred charges11,12811,061Accumulated amortization(5,175)(4,558)Deferred charges, net5,9536,503In-place lease values, related intangibles and other assets, net9,4319,519Right of use assets (b)4,8835,145Prepaid expenses and other assets, net 23,41327,309Total deferred charges and other assets, net$43,680$48,476(a)This amount relates to the deferred financing costs associated with the revolving credit facility.  Deferred financing costs related to all other debt liabilities are netted against those debt liabilities for all periods presented.(b)This amount has a corresponding liability of $6.3 million and $6.5 million as of March 31, 2025 and December 31, 2024, respectively, which is included in Accounts payable, accrued expense and other liabilities. See Note 12: Commitments and Contingencies – Office and Ground Lease agreements for further details.DERIVATIVE FINANCIAL INSTRUMENTSCash Flow Hedges of Interest Rate RiskThe Company’s objectives in using interest rate derivatives are to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate caps as part of its interest rate risk management strategy.  Interest rate caps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an up-front premium.The changes in the fair value of derivatives designated and that qualify as cash flow hedges are recorded in accumulated other comprehensive income and subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. During the next 12 months, the Company estimates $1.3 million will be reclassified as an increase to interest expense.As of March 31, 2025, the Company had six interest rate caps outstanding and in effect with a notional amount of $441.5 million designated as cash flow hedges of interest rate risk, and one undesignated interest rate cap outstanding and in effect with a notional amount of $150.0 million.The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated balance sheets as of March 31, 2025 and December 31,