Host Hotels & Resorts, a lodging real estate investment trust, amended and restated its existing $2.5 billion credit facility.
The agreement extends maturities from January 2025 to January 2028, including all extension options, and continues to provide a $1.5 billion revolving credit facility and two $500 million term loans. The amended and restated facilities reflect no increase in pricing and will bear interest pursuant to a credit ratings-based grid ranging from 0.725%-1.600% over the applicable adjusted term SOFR. Other terms of the agreement are similar to the company’s previous credit facility agreement.
In addition, the agreement reflects the company’s commitment to ESG initiatives by adding incentives linked to portfolio sustainability initiatives, including green building certifications and renewable electricity usage. Specific sustainability targets include:
Increasing the number of hotels in the portfolio with green building certifications to 38% by 2027
Increasing the percentage of electricity used across the consolidated portfolio that is generated by renewable resources to 38% by 2027
“We are extremely pleased to further enhance the strength and flexibility of our balance sheet with this refinancing, which reflects no increase in pricing,” Sourav Ghosh, executive vice president and chief financial officer, said. “We are equally pleased to further demonstrate our leadership in sustainability by being the first lodging REIT to link pricing incentives to initiatives that contribute to our science-based targets initiative verified carbon emissions goal and to increasing the resilience of our portfolio.
“We greatly appreciate the strong, longstanding partnerships demonstrated by our banks and their continued recognition of the Company’s superior balance sheet, liquidity position and its disciplined capital allocation track record – attributes that we believe will continue to positively differentiate Host in the future.”
At closing, no amounts were outstanding under the revolving credit facility other than existing letters of credit, and $1 billion was outstanding under the two term loans. The company’s debt has a weighted average maturity of 5.2 years, an average interest rate of 4.4% and no significant maturities until April 2024.
The credit facilities are led jointly by Wells Fargo Securities, BofA Securities and JPMorgan Chase Bank. Bank of America served as the administrative agent. Wells Fargo Bank and JPMorgan Chase Bank served as co-syndication agents. Credit Agricole Corporate and Investment Bank served as sustainability structuring agent.
