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 our exposure to interest rate changes on our floating-rate debt and fair value changes on certain fixed-rate debt. We do not utilize derivative financial instruments for trading or speculative purposes. The table below summarizes our debt as of December 31, 2025 and 2024:

At December 31, 2025 and 2024, we have an interest rate swap with a notional amount of $500.0 million which converted our $500.0 million principal amount of 5.85% fixed rate senior unsecured notes due November 2026 into a floating rate instrument with an interest rate based on a SOFR index. This interest rate swap was designated and qualified as a fair value hedging instrument. The interest rate swap is considered to be effective at achieving offsetting changes in the fair value of the hedged debt and no ineffectiveness is recognized. The mark-to-market of this fair value hedge is recorded as a gain or loss in interest expense and equally offset by the gain or loss of the underlying debt, which also is recorded in interest expense.

Additionally, at both December 31, 2025 and 2024, we had an unsecured term loan outstanding of approximately $39.9 million. At December 31, 2025 we also had an aggregate principal amount of $590.0 million of Notes outstanding under our commercial paper program. At December 31, 2024 we also had $178.0 million of borrowings under our unsecured revolving credit facility. If interest rates on the variable rate debt listed in the table above would have been 100 basis points higher throughout 2025 and 2024, our annual interest costs would have increased by approximately $11.3 million and $7.2 million, respectively.

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, 2025, the fair value of our fixed rate debt would have decreased by approximately $117.3 million.