NOTE 5. BORROWINGS

Our borrowings as of March 31, 2014, and December 31, 2013, are summarized below:

The weighted-average effective interest rate charged on all of our borrowings, excluding the impact of deferred financing costs, was 3.5% and 3.6% for the three months ended March 31, 2014 and 2013, respectively.

Mortgage Note Payable

On December 30, 2010, we executed a loan agreement with MetLife in an amount not to exceed $45.2 million, pursuant to a long-term note payable. The note currently accrues interest at a rate of 3.50% per year. The interest rate was subject to adjustment on January 5, 2014, and remained unchanged at 3.50%. The interest rate will be subject to further adjustment on January 5, 2017, and every three years thereafter to then-current market rates. The note is scheduled to mature on January 5, 2026, and we may not repay the note prior to maturity, except on one of the interest rate adjustment dates. We also incur a commitment fee of 0.20% on any undrawn amounts. As of March 31, 2014, there is no remaining balance available under the mortgage loan.

The fair value of our mortgage note payable outstanding as of March 31, 2014, was approximately $41.8 million, as compared to a carrying value of $41.3 million. The fair value of the mortgage note payable was valued using Level 3 inputs under the hierarchy established by ASC 820, “Fair Value Measurements and Disclosures,” and is calculated based on a discounted cash flow analysis, using interest rates based on management’s estimates of market interest rates on long-term debt with comparable terms.

Scheduled principal payments of the mortgage note payable for the remainder of 2014 and each of the five succeeding fiscal years and thereafter are as follows:

As of March 31, 2014, the following properties have been pledged as collateral under this mortgage note payable: West Gonzales, West Beach, Dalton Lane, Keysville Road, Colding Loop, Trapnell Road, 38^th Avenue and Sequoia Street.

Line of Credit

In May 2012, we obtained a $4.8 million revolving line of credit with MetLife that matures on April 5, 2017 (the “Credit Facility”). Our obligations under the Credit Facility are collateralized by a mortgage on San Andreas. The interest rate charged on the advances under the Credit Facility is equal to the three-month London Interbank Offered Rate (“LIBOR”) in effect at the beginning of each calendar quarter plus 3.00%, with a minimum annualized rate of 3.25%. We may use advances under the Credit Facility for both general corporate purposes and the acquisition of new properties.

As of both March 31, 2014, and December 31, 2013, there was $0.1 million outstanding under the Credit Facility, which is the minimum balance required, and approximately $4.7 million of availability from which we may draw. Due to the revolving nature of a line of credit, the carrying value of our Credit Facility of $0.1 million as of both March 31, 2014, and December 31, 2013, is deemed to approximate fair value.