Host Hotels & Resorts Successfully Amends $2.5 Billion Credit Agreement to Enhance Flexibility and Preserve Liquidity and Updates Investor Presentation

June 29, 2020

Source: GlobeNewswire

Host Hotels & Resorts, Inc. (NYSE: HST), the nation's largest lodging real estate investment trust (the "Company"), announced today that it successfully amended the credit agreement governing its $1.5 billion fully drawn revolving credit facility and two $500 million term loans.

James F. Risoleo, President and Chief Executive Officer, said, “We obtained favorable waiver terms from our supportive bank group due to the Company’s superior balance sheet and liquidity position as well as our disciplined capital allocation track record. We greatly appreciate the strong, longstanding partnership demonstrated by our banks and are pleased to have amended our revolving and term loan credit facilities in a manner that preserves our liquidity to withstand prolonged business disruption and enhances our flexibility to capitalize on investment opportunities that create long-term value for our stakeholders.”

Key terms of the amended credit agreement include:

Waiver of the existing quarterly-tested financial covenants for the period beginning July 1, 2020 through the second quarter of 2021, with testing resuming for the third quarter of 2021  (the "Covenant Relief Period").  The Company also has the option to terminate the Covenant Relief Period early;

Modification of the quarterly-tested leverage covenant and EBITDA calculation to ease compliance in the first three quarters after the end of the Covenant Relief Period;

Permission to finance encumbered or unencumbered acquisitions of up to $1.5 billion with existing liquidity as long as the Company maintains total minimum liquidity of $500 million;

Ability to fund up to $500 million in ROI capital expenditures during the Covenant Relief Period as well as complete capital expenditures incurred in connection with emergency repairs, life safety repairs or ordinary course maintenance repairs;

Addition of a 15-basis points LIBOR floor for the life of the revolving credit facility and term loans and an interest rate increase of 40-basis points in the credit ratings-based interest rate grid during the Covenant Relief Period for the revolving credit facility and term loans;

Addition of certain restrictions and covenants for the duration of the Covenant Relief Period, including restrictions on dividend and distribution payments (subject to REIT requirements), share repurchases and new covenants limiting the incurrence of additional indebtedness, asset sales, and investments (in each case subject to various exceptions);

Maintenance of the revolving credit facility and one term loan’s initial maturity date of January 2024 with options to extend to January 2025. Maintenance of the second term loan’s final maturity date of January 2025.

Notably, the Company preserved the fully unsecured status of its 80 consolidated assets and maintained flexibility to sell assets in connection with like kind exchanges (up to $750 million) as well as other asset sales up to $350 million before triggering any mandatory prepayment obligations under the credit facility.

PJT Partners served as independent financial advisor to the Company on its credit facility amendment.

On June 30th, the Company plans to voluntarily repay approximately $750 million of borrowings outstanding under its $1.5 billion fully-drawn revolving credit facility. The Company will continually monitor its liquidity requirements and evaluate the need to draw on its revolver capacity.

Updated Investor Presentation

For additional information on terms of the amended credit agreement as well as an update on business performance, including preliminary May top line results, please refer to the pdf or interactive version of the July 2020 investor presentation located in the investor section of the Company’s website

About Host Hotels & Resorts

Host Hotels & Resorts, Inc. is an S&P 500 company and is the largest lodging real estate investment trust and one of the largest owners of luxury and upper-upscale hotels. The Company currently owns 75 properties in the United States and five properties internationally totaling approximately 46,700 rooms. The Company also holds non-controlling interests in six domestic and one international joint ventures. Guided by a disciplined approach to capital allocation and aggressive asset management, the Company partners with premium brands such as Marriott®, Ritz-Carlton®, Westin®, Sheraton®, W®, St. Regis®, The Luxury Collection®, Hyatt®, Fairmont®, Hilton®, Swissôtel®, ibis® and Novotel®, as well as independent brands. For additional information, please visit the Company’s website at www.hosthotels.com.

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Tejal Engman
Vice President
240.744.5116