Item 7A. Quantitative and Qualitative Disclosures About Market Risk

We believe the primary market risk we face is interest rate risk. We seek to mitigate this risk by following established risk management policies, which includes (i) maintaining prudent levels of fixed and floating rate debt; and (ii) extending and sequencing the maturity dates of our debt where practicable. We also periodically use derivative financial instruments, primarily interest rate swaps with major financial institutions, to manage a portion of this risk. We do not utilize derivative financial instruments for trading or speculative purposes. The table below summarizes our debt as of December 31, 2021 and 2020:

In order to manage interest rate exposure, we have utilized interest rate swap agreements to protect against unfavorable interest rate changes relating to forecasted debt transactions. These swaps, which are settled upon issuance of the related debt, are designated as cash flow hedges and the gains and/or losses are deferred in other comprehensive income and recognized as an adjustment to interest expense over the same period the hedged interest payments affect earnings. As of December 31, 2021, we had no hedges outstanding.

We did not have any borrowings outstanding under our unsecured credit facility at December 31, 2021 or 2020. At December 31, 2021 and 2020, we had a term loan outstanding of approximately $39.9 million and $39.7 million, respectively. If interest rates on the variable rate debt listed in the table above would have been 100 basis points higher throughout 2021 and 2020, our annual interest costs would have increased by approximately $0.4 million for each period.

For fixed rate debt, interest rate changes affect the fair market value but do not impact net income attributable to common shareholders or cash flows. Holding other variables constant, if interest rates would have been 100 basis points higher as of December 31, 2021, the fair value of our fixed rate debt would have decreased by approximately $198.8 million.