Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurement

v3.19.2
Fair Value Measurement
6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]  
Fair Value Measurement Fair Value Measurement
At June 30, 2019 and December 31, 2018, the carrying value of receivables, accounts payable, accrued expenses and distributions payable to noncontrolling interests approximates fair value due to their short-term nature and falls under the Level 2 hierarchy. The carrying values and fair values of debt instruments are as follows (in thousands):
 
 
June 30, 2019
 
December 31, 2018
 
 
Carrying Value
 
Fair Value
 
Carrying Value
 
Fair Value
Bank line of credit
 
$
239,035

 
$
239,035

 
$
247,000

 
$
247,000

Senior debt
 
818,804

 
819,026

 
828,517

 
828,309

Subordinated debt
 
315,913

 
327,749

 
273,337

 
272,937

Securitization debt
 
589,430

 
621,137

 
400,068

 
394,756

Total
 
$
1,963,182

 
$
2,006,947

 
$
1,748,922

 
$
1,743,002


At June 30, 2019 and December 31, 2018, the fair value of the Company’s lines of credit, and certain senior, subordinated and SREC loans approximate their carrying values because their interest rates are variable rates that approximate rates currently available to the Company. At June 30, 2019 and December 31, 2018, the fair value of the Company’s other debt instruments are based on rates currently offered for debt with similar maturities and terms. The Company’s fair value of the debt instruments fell under the Level 2 hierarchy. These valuation approaches involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market.
The Company determines the fair value of its interest rate swaps using a discounted cash flow model that incorporates an assessment of the risk of non-performance by the interest rate swap counterparty and an evaluation of the Company’s credit risk in valuing derivative instruments. The valuation model uses various inputs including contractual terms, interest rate curves, credit spreads and measures of volatility.
At June 30, 2019 and December 31, 2018, financial instruments measured at fair value on a recurring basis, based upon the fair value hierarchy, are as follows (in thousands):
 
 
June 30, 2019
 
 
Level 1
 
Level 2
 
Level 3
 
Total
Derivative assets:
 
 
 
 
 
 
 
 
Interest rate swaps
 
$

 
$
111

 
$

 
$
111

Total
 
$

 
$
111

 
$

 
$
111

Derivative liabilities:
 
 
 
 
 
 
 
 
Interest rate swaps
 
$

 
$
56,590

 
$

 
$
56,590

Total
 
$

 
$
56,590

 
$

 
$
56,590


 
 
December 31, 2018
 
 
Level 1
 
Level 2
 
Level 3
 
Total
Derivative assets:
 
 
 
 
 
 
 
 
Interest rate swaps
 
$

 
$
6,958

 
$

 
$
6,958

Total
 
$

 
$
6,958

 
$

 
$
6,958

Derivative liabilities:
 
 
 
 
 
 
 
 
Interest rate swaps
 
$

 
$
11,910

 
$

 
$
11,910

Total
 
$

 
$
11,910

 
$

 
$
11,910