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Debt
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
Debt Debt
 
The Company's debt consisted of the following (in thousands):
December 31, 2022December 31, 2021
Senior Notes, net$989,307 $986,942 
Revolver — 200,000 
Term Loans, net820,536 815,004 
Mortgage loans, net407,712 407,492 
Debt, net$2,217,555 $2,409,438 
Senior Notes

The Company's senior notes (collectively, the "Senior Notes") consisted of the following (in thousands):
Carrying Value at
Interest Rate at December 31, 2022Maturity DateDecember 31, 2022December 31, 2021
2029 Senior Notes (1)(2)4.00%September 2029$500,000 $500,000 
2026 Senior Notes (1)(3)3.75%July 2026500,000 500,000 
1,000,000 1,000,000 
Deferred financing costs, net(10,693)(13,058)
Total senior notes, net$989,307 $986,942 

(1)Requires payments of interest only through maturity.
(2)The Company has the option to redeem its 4.00% senior notes due 2029 (the "2029 Senior Notes") at any time prior to September 15, 2024 at a price equal to 100.0% of the principal amount plus a make-whole premium. At any time on or after September 15, 2024, the Company may redeem the 2029 Senior Notes at a redemption price of (i) 102.0% of the principal amount should such redemption occur before September 15, 2025, (ii) 101.0% of the principal amount should such redemption occur before September 15, 2026 and (iii) 100.0% of the principal amount thereafter, in each case plus accrued and unpaid interest, if any. At any time prior to September 15, 2024, the Company may redeem the 2029 Senior Notes with the net cash proceeds from any equity offering at a redemption price equal to 104.0% of the principal amount plus accrued and unpaid interest, if any, subject to certain conditions.
(3)The Company has the option to redeem its 3.75% senior notes due 2026 (the "2026 Senior Notes") at any time prior to July 1, 2023 at a price equal to 100.0% of the principal amount plus a make-whole premium. At any time on or after July 1, 2023, the Company may redeem the 2026 Senior Notes at a redemption price of (i) 101.875% of the principal amount should such redemption occur before July 1, 2024, (ii) 100.938% of the principal amount should such redemption occur before July 1, 2025 and (iii) 100.0% of the principal amount thereafter, in each case plus accrued and unpaid interest, if any. At any time prior to July 1, 2023, the Company may redeem the 2026 Senior Notes with the net cash proceeds from any equity offering at a redemption price equal to 103.75% of the principal amount plus accrued and unpaid interest, if any, subject to certain conditions.

The Senior Notes are each fully and unconditionally guaranteed, jointly and severally, by the Company and certain of the Operating Partnership’s subsidiaries that incur and guarantee indebtedness under the Company’s credit facilities and certain other indebtedness. On October 25, 2022, the collateral securing the Senior Notes was released in accordance with the terms of the indentures governing the Senior Notes. The indentures contain customary covenants that limit the Operating Partnership’s ability and, in certain instances, the ability of its subsidiaries, to incur additional debt, create liens on assets, make distributions and pay dividends, make certain types of investments, issue guarantees of indebtedness, and make certain restricted payments. These limitations are subject to a number of exceptions and qualifications set forth in the indentures.

A summary of the various restrictive covenants for the Senior Notes are as follows:
CovenantCompliance
Maintenance Covenant
Unencumbered Asset to Unencumbered Debt Ratio
> 150.0%
Yes
Incurrence Covenants
Consolidated Indebtedness less than Adjusted Total Assets
< .65x
Yes
Consolidated Secured Indebtedness less than Adjusted Total Assets
< .45x
Yes
Interest Coverage Ratio
> 1.5x
Yes

As of December 31, 2022 and 2021, the Company was in compliance with all covenants associated with the Senior Notes.

Revolver and Term Loans
 
The Company has the following unsecured credit agreements in place:

•$600.0 million revolving credit facility with a scheduled maturity date of May 18, 2024 and a one year extension option if certain conditions are satisfied (the "Revolver");

•$400.0 million term loan with a scheduled maturity date of January 25, 2023 for approximately $52.3 million of the outstanding principal balance (the "$400 Million Term Loan Maturing 2023") and a scheduled maturity date of
January 25, 2024, including a one year extension option exercised in January 2023, for approximately $151.7 million of the remaining outstanding principal balance (the "$400 Million Term Loan Maturing 2024").

•$225.0 million term loan with a scheduled maturity date of January 25, 2023 for approximately $41.7 million of the outstanding principal balance (the "$225 Million Term Loan Maturing 2023") and a scheduled maturity date of January 25, 2024, including a one year extension option exercised in January 2023, for approximately $73.0 million of the remaining outstanding principal balance (the "$225 Million Term Loan Maturing 2024").

•$400.0 million term loan with a scheduled maturity date of May 18, 2025 (the "$400 Million Term Loan Maturing 2025"); and

•$200.0 million term loan with a scheduled maturity date of January 31, 2026 and two one year extension options if certain conditions are satisfied (the "$200 Million Term Loan Maturing 2026").

The $400 Million Term Loan Maturing 2023, the $400 Million Term Loan Maturing 2024, the $225 Million Term Loan Maturing 2023, the $225 Million Term Loan Maturing 2024, the $400 Million Term Loan Maturing 2025, and the $200 Million Term Loan Maturing 2026 are collectively the "Term Loans".  The credit agreements contain certain financial covenants relating to the Company’s maximum leverage ratio, minimum fixed charge coverage ratio, maximum secured indebtedness, maximum unencumbered leverage ratio and minimum unsecured interest coverage ratio.  If an event of default exists, the Company is not permitted to make distributions to shareholders, other than those required to qualify for and maintain REIT status. 
 
The borrowings under the Revolver and Term Loans bear interest at variable rates equal to LIBOR or the Term Secured Overnight Financing Rate (“Term SOFR”) plus an applicable margin.  The margin ranges from 1.35% to 2.55%, depending on the Company’s leverage ratio, as calculated under the terms of each facility.  The Company incurs an unused facility fee on the Revolver of between 0.20% and 0.25%, based on the amount by which the maximum borrowing amount exceeds the total principal balance of the outstanding borrowings.
 
 The Company's unsecured credit agreements consisted of the following (in thousands):
Carrying Value at
Interest Rate at December 31, 2022 (1)Maturity DateDecember 31, 2022December 31, 2021
Revolver (2)—%May 2024$— $200,000 
$400 Million Term Loan Maturing 2023 (3)3.84%January 202352,261 52,261 
$400 Million Term Loan Maturing 20243.84%January 2024 (5)151,683 151,683 
$225 Million Term Loan Maturing 2023 (3)3.84%January 202341,745 41,745 
$225 Million Term Loan Maturing 20243.18%January 2024 (6)72,973 72,973 
$400 Million Term Loan Maturing 20253.24%May 2025400,000 400,000 
$200 Million Term Loan Maturing 2026 (4)2.85%January 2026 (7)105,000 100,000 
823,662 1,018,662 
Deferred financing costs, net (8)(3,126)(3,658)
Total Revolver and Term Loans, net$820,536 $1,015,004 

(1)Interest rate at December 31, 2022 gives effect to interest rate hedges.
(2)At December 31, 2022 and 2021, there was $600.0 million and $400.0 million of remaining capacity on the Revolver, respectively. The Company has the ability to further increase the total capacity on the Revolver to $750.0 million, subject to certain lender requirements. The Company also has the ability to extend the maturity date for an additional one year period ending May 2025 if certain conditions are satisfied.
(3)In January 2023, the Company received $95.0 million in borrowings on the amended $200 Million Term Loan Maturing 2026 and utilized the proceeds to pay off this term loan.
(4)In November 2022, the Company amended this term loan to increase the amount of the term loan up to $200.0 million and extend the initial maturity to January 2026, with two one year extension options.
(5)In January 2023, the Company exercised its option to extend the maturity of this term loan balance to January 2024.
(6)In January 2023, the Company exercised its option to extend the maturity of this term loan balance to January 2024.
(7)This term loan includes two one year extension options. The exercise of the extension options will be at the Company's discretion, subject to certain conditions.
(8)Excludes $1.7 million and $2.9 million as of December 31, 2022 and 2021, respectively, related to deferred financing costs on the Revolver, which are included in prepaid expense and other assets in the accompanying consolidated balance sheets.
The Revolver and Term Loans are subject to various financial covenants. A summary of the most restrictive covenants is as follows:
CovenantCompliance
Leverage ratio (1)
<= 7.00x
Yes
Fixed charge coverage ratio (2)
 >= 1.50x
Yes
Secured indebtedness ratio
<= 45.0%
Yes
Unencumbered indebtedness ratio
<= 60.0%
Yes
Unencumbered debt service coverage ratio
 >= 2.00x
Yes

(1)Leverage ratio is net indebtedness, as defined in the Revolver and Term Loan agreements, to corporate earnings before interest, taxes, depreciation, and amortization ("EBITDA"), as defined in the Revolver and Term Loan agreements.
(2)Fixed charge coverage ratio is Adjusted EBITDA, generally defined in the Revolver and Term Loan agreements as EBITDA less FF&E reserves, to fixed charges, which is generally defined in the Revolver and Term Loan agreements as interest expense, all regularly scheduled principal payments, preferred dividends paid, and cash taxes paid.

During the year ended December 31, 2021, the Company amended its Revolver and Term Loans. The amendments suspended the testing of all existing financial maintenance covenants for all periods through and including the fiscal quarter ending March 31, 2022 (the “Covenant Relief Period”). In addition, for periods following the Covenant Relief Period, the amendments modified certain covenant thresholds, including the leverage ratio, through the fifth quarter following the Covenant Relief Period. During the year ended December 31, 2022, the Company satisfied the requirements to exit all restrictions under the Revolver and Term Loan agreements.

In November 2022, the Company amended the $200 Million Term Loan Maturing 2026 to increase the amount of the term loan up to $200.0 million and extend the maturity to January 2026, with two one year extension options. The borrowings under this loan bear interest at a variable rate equal to Term SOFR plus an applicable margin. The margin ranges from 1.35% to 1.90%, depending on the Company’s leverage ratio, as calculated under the terms of the facility, plus a credit spread adjustment of ten basis points.

In January 2023, the Company received $95.0 million in borrowings on the amended $200 Million Term Loan Maturing 2026 and utilized the proceeds to pay off approximately $52.3 million of the principal balance of its $400 Million Term Loan Maturing 2023 and approximately $41.7 million of the principal balance of its $225 Million Term Loan Maturing 2023.

Mortgage Loans
 
The Company's mortgage loans consisted of the following (in thousands):
Carrying Value at
Number of Assets EncumberedInterest Rate at December 31, 2022 (1)Maturity DateDecember 31, 2022December 31, 2021
Mortgage loan (2)73.25%April 2023(4)$200,000 $200,000 
Mortgage loan (2)32.53%April 2024(5)96,000 96,000 
Mortgage loan (2)43.43%April 2024(5)85,000 85,000 
Mortgage loan (3)15.06%January 202927,193 27,554 
15408,193 408,554 
Deferred financing costs, net(481)(1,062)
Total mortgage loans, net$407,712 $407,492 
(1)Interest rate at December 31, 2022 gives effect to interest rate hedges.
(2)The hotels encumbered by the mortgage loan are cross-collateralized. Requires payments of interest only through maturity.
(3)Includes $2.2 million and $2.6 million at December 31, 2022 and 2021, respectively, related to a fair value adjustment on this mortgage loan.
(4)The mortgage loan provides for an additional one year extension option.
(5)The mortgage loan provides two one year extension options.
Certain mortgage agreements are subject to various maintenance covenants requiring the Company to maintain a minimum debt yield or debt service coverage ratio ("DSCR"). Failure to meet the debt yield or DSCR thresholds is not an event of default, but instead triggers a cash trap event. During the cash trap event, the lender or servicer of the mortgage loan controls cash outflows until the loan is covenant compliant and accordingly, such cash is restricted. In addition, certain mortgage loans have other requirements including continued operation and maintenance of the hotel property. At December 31, 2021, two mortgage loans failed the debt yield or DSCR threshold and approximately $22.4 million of restricted cash was held by lenders due to cash trap events.  In addition, the DSCR covenant for one mortgage loan had been waived through December 31, 2022.  As of December 31, 2022, although all mortgage loans met their debt yield or DSCR thresholds, one mortgage loan was in a cash trap event pending notification to the lender to remove the restrictions.  As of December 31, 2022, there was approximately $26.9 million of restricted cash held by this lender due to the cash trap event, and in February 2023, the restrictions were removed.   

Interest Expense

The components of the Company's interest expense consisted of the following (in thousands):
For the year ended December 31,
202220212020
Senior Notes$38,820 $34,079 $23,767 
Revolver and Term Loans34,126 54,733 55,413 
Mortgage loans13,563 13,306 16,949 
Amortization of deferred financing costs5,967 5,884 4,416 
Non-cash interest expense related to interest rate
hedges		679 (1,636)— 
Undesignated interest rate swaps— — (376)
Total interest expense$93,155 $106,366 $100,169 

Future Minimum Principal Payments

As of December 31, 2022, the future minimum principal payments were as follows (in thousands):
2023 (1)$294,005 
2024405,657 
2025400,000 
2026605,000 
2027— 
Thereafter525,000 
Total (2)$2,229,662 

(1)Excludes the term loans for which the Company exercised its one year extension option in January 2023.
(2)Excludes a $2.2 million fair value adjustment on debt.