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DEBT | 3 Months Ended
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Mar. 31, 2025
Debt Disclosure [Abstract] |
DEBT | DEBT At March 31, 2025 and December 31, 2024, we had $4,328 million and $3,782 million, respectively, of total debt, which included $406 million and $456 million, respectively, recorded in current maturities of long-term debt on our condensed consolidated balance sheets. Senior Notes Issuances—During the three months ended March 31, 2025, we issued $500 million of 5.050% senior notes due 2028 at an issue price of 99.905% (the "2028 Notes") and $500 million of 5.750% senior notes due 2032 at an issue price of 99.936% (the "2032 Notes"). We received approximately $990 million of net proceeds from the sale, after deducting $10 million of underwriting discounts and other offering expenses. We temporarily invested the net proceeds from the issuance in marketable securities (see Note 4), and we intend to use the net proceeds to fund a portion of the purchase price for the Playa Hotels Acquisition (see Note 6). Interest is payable semi-annually on March 30 and September 30 of each year, beginning on September 30, 2025. Senior Notes Repayment—During the three months ended March 31, 2025, we repaid the outstanding $450 million of 5.375% senior notes due 2025 (the "2025 Notes") at maturity for approximately $460 million, inclusive of $10 million of accrued interest. Variable Rate Mortgage Loan—During the year ended December 31, 2024, we assumed a €50 million secured mortgage loan through a facility agreement with Banco Bilbao Vizcaya Argentaria, S.A. ("BBVA") in conjunction with the acquisition of three Alua hotels. The variable rate loan, which had approximately $54 million and $52 million outstanding at March 31, 2025 and December 31, 2024, respectively, matures in 2031. Additionally, we assumed €38 million of interest rate swaps with BBVA that expire in 2029 and reduce our exposure to fluctuations in the Euro Interbank Offered Rate. The interest rate swaps are remeasured at fair value on a recurring basis and are classified as Level Two in the fair value hierarchy. The fair values of the interest rate swaps are estimated using an income approach based on the terms of the interest rate swap contracts and inputs corroborated by observable market data including interest rates and yield curves. At both March 31, 2025 and December 31, 2024, the fair values of the interest rate swaps were insignificant. Variable Rate Term Loan—During the year ended December 31, 2024, we entered into a credit agreement with Bank of America to correspond with the total amount of the secured financing receivable we issued to the buyer in conjunction with the sale of Park Hyatt Zurich for a CHF 41 million variable rate term loan, which matures in 2029. At March 31, 2025 and December 31, 2024, we had approximately $46 million and $45 million, respectively, outstanding. Revolving Credit Facility—During both the three months ended March 31, 2025 and March 31, 2024, we had no borrowings or repayments on our revolving credit facility. At both March 31, 2025 and December 31, 2024, we had no balance outstanding. At March 31, 2025, we had $1,497 million of borrowing capacity available under our revolving credit facility, net of letters of credit outstanding. Fair Value—We estimated the fair value of debt, which consists of the senior unsecured notes below (collectively, the "Senior Notes") and other long-term debt, excluding finance leases. •$400 million of 4.850% senior notes due 2026 •$600 million of 5.750% senior notes due 2027 •$400 million of 4.375% senior notes due 2028 •$500 million of 5.050% senior notes due 2028 •$600 million of 5.250% senior notes due 2029 •$450 million of 5.750% senior notes due 2030 •$450 million of 5.375% senior notes due 2031 •$500 million of 5.750% senior notes due 2032 •$350 million of 5.500% senior notes due 2034 Our Senior Notes are classified as Level Two due to the use and weighting of multiple market inputs in the final price of the security. We estimated the fair value of other debt instruments using a discounted cash flow analysis based on current market inputs for similar types of arrangements. Based on the lack of available market data, we have classified our other debt instruments and revolving credit facility, if applicable, as Level Three in the fair value hierarchy. The primary sensitivity in these models is based on the selection of appropriate discount rates. Fluctuations in our assumptions will result in different estimates of fair value.
| March 31, 2025
| Carrying value |  | Fair value |  | Quoted prices in active markets for identical assets (Level One) |  | Significant other observable inputs (Level Two) |  | Significant unobservable inputs (Level Three)
Debt (1) | $ | 4,359 |  |  | $ | 4,386 |  |  | $ | — |  |  | $ | 4,263 |  |  | $ | 123 |
(1) Excludes $4 million of finance lease obligations and $35 million of unamortized discounts and deferred financing fees.
| December 31, 2024
| Carrying value |  | Fair value |  | Quoted prices in active markets for identical assets (Level One) |  | Significant other observable inputs (Level Two) |  | Significant unobservable inputs (Level Three)
Debt (2) | $ | 3,805 |  |  | $ | 3,813 |  |  | $ | — |  |  | $ | 3,695 |  |  | $ | 118 |
(2) Includes the 2025 Notes and excludes $4 million of finance lease obligations and $27 million of unamortized discounts and deferred financing fees.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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