Business
Host Hotels & Resorts Successfully Extends Credit Facility Waiver Period and Increases Financial Flexibility and Optionality
BETHESDA, Md., Feb. 10, 2021 (GLOBE NEWSWIRE) -- Host Hotels & Resorts, Inc. (NASDAQ: HST), the nation's largest lodging real estate investment trust (the
About this update from Host Hotels & Resorts, Inc.
[{"type":"text","content":"BETHESDA, Md., Feb. 10, 2021 (GLOBE NEWSWIRE) -- Host Hotels & Resorts, Inc. (NASDAQ: HST), the nation's largest lodging real estate investment trust (the “Company”), announced today that it completed a second amendment to the credit agreement governing its $1.5 billion revolving credit facility and two $500 million term loans. Sourav Ghosh, Executive Vice President, Chief Financial Officer and Treasurer, said, “We obtained new industry-leading amendment terms that provide continued covenant relief while significantly enhancing our flexibility to capitalize on investment opportunities that can create long-term value for our stakeholders. We greatly appreciate the strong, longstanding partnership demonstrated by our banks and their continued recognition of the Company’s superior balance sheet and liquidity position as well as its disciplined capital allocation track record – attributes that we believe will positively differentiate Host through the lodging recovery.” Key terms of the second amendment to the credit agreement include: Continued waiver of all quarterly-tested financial covenants through the first quarter of 2022, with testing resuming for the second quarter of 2022 (the “first test period”);For the first test period, only the fixed charge coverage ratio covenant is tested with a minimum requirement of 1.0x; all other covenants are waived until the quarter ending September 30, 2022;Modification of leverage covenant to ease compliance for the first five quarters following the first test period, with maximum leverage thresholds by quarter listed below; 8.5x for the quarters ending September 30 and December 31 of 20228.0x for the quarters ending March 31 and June 30 of 20237.50x for the quarter ending September 30, 20237.25x thereafter Ability to retain $500 million from asset sales for the purpose of reinvesting in acquisitions unencumbered by debt in addition to the prior ability to reinvest $750 million of net sale proceeds through the like-kind-exchange exchange process;Permission to acquire assets up to $2.0 billion with existing liquidity and the above-mentioned asset sales as long as the Company maintains total minimum liquidity of $600 million; andAbility to fund $450 million in ROI capital expenditures during the extended covenant relief period in addition to any unused amount of the $500 million capacity under ...