Notes Payable (Tables)

12 Months Ended

Dec. 31, 2017

Notes Payable

Schedule of notes payable

Notes payable consisted of the following at December 31 (in thousands):

	2017		2016
Notes payable requiring payments of interest and principal, with fixed rates ranging from 4.12% to 5.95%; maturing at dates ranging from November 2020 through January 2025. The notes are collateralized by first deeds of trust on four hotel properties at December 31, 2017, and five hotel properties at December 31, 2016.	$	345,402	$	528,604
Note payable requiring payments of interest only as of December 31, 2017, bearing a blended rate of one-month LIBOR plus 105 basis points, and interest and principal as of December 31, 2016, bearing a blended rate of one-month LIBOR plus 225 basis points; maturing in December 2020 with three one-year extensions. The note is collateralized by a first deed of trust on one hotel property.		220,000		222,340
Unsecured term loan requiring payments of interest only, with a blended interest rate based on a pricing grid with a range of 180 to 255 basis points over LIBOR, depending on the Company's leverage ratios. LIBOR has been swapped to a fixed rate of 1.591%, resulting in an effective interest rate of 3.391% based on the Company's current leverage. Matures in September 2022.		85,000		85,000
Unsecured term loan requiring payments of interest only, with a blended interest rate based on a pricing grid with a range of 180 to 255 basis points over LIBOR, depending on the Company's leverage ratios. LIBOR has been swapped to a fixed rate of 1.853%, resulting in an effective interest rate of 3.653% based on the Company's current leverage. Matures in January 2023.		100,000		100,000
Unsecured Senior Notes requiring semi-annual payments of interest only, bearing interest at 4.69%; maturing in January 2026.		120,000		—
Unsecured Senior Notes requiring semi-annual payments of interest only, bearing interest at 4.79%; maturing in January 2028.		120,000		—
Total notes payable	$	990,402	$	935,944
Current portion of notes payable	$	7,420	$	186,034
Less: current portion of deferred financing fees		(1,943)		(1,105)
Carrying value of current portion of notes payable	$	5,477	$	184,929
Notes payable, less current portion	$	982,982	$	749,910
Less: long-term portion of deferred financing fees		(5,700)		(3,536)
Carrying value of notes payable, less current portion	$	977,282	$	746,374

Schedule of aggregate future principal maturities and amortization of notes payable

Aggregate future principal maturities and amortization of notes payable at December 31, 2017, are as follows (in thousands):

2018	$	7,420
2019		7,957
2020		304,137
2021		111,247
2022		88,446
Thereafter		471,195
Total	$	990,402

Schedule of deferred finance fees and losses on extinguishment of debt

Deferred financing fees and losses on extinguishment of debt for the years ended December 31, 2017, 2016 and 2015 were as follows (in thousands):

	2017 (1)		2016 (2)		2015 (3)
Payments of deferred financing costs	$	3,537	$	1,759	$	5,861
Accelerated amortization of deferred financing fees	$	—	$	—	$	455
Loss on extinguishment of debt	$	824	$	284	$	2,964

(1) During the year ended December 31, 2017, the Company paid a total of $3.5 million in deferred financing costs related to its new $220.0 million loan secured by the Hilton San Diego Bayfront, its Senior Notes and its credit facility. In addition, during 2017, the Company incurred a loss on extinguishment of debt totaling $0.8 million related to its 2017 debt repayment and refinancing.

(2) During the year ended December 31, 2016, the Company paid a total of $1.8 million in deferred financing costs related to its $100.0 million unsecured term loan, its credit facility and its senior unsecured notes. In addition, during 2016, the Company incurred a loss on extinguishment of debt totaling $0.3 million related to its 2016 debt repayments.

(3) During the year ended December 31, 2015, the Company paid a total of $5.9 million in deferred financing costs related to its credit facility and two term loan agreements, as well as its loans entered into in December 2014 secured by the Embassy Suites La Jolla and the JW Marriott New Orleans. In addition, during 2015, the Company wrote off $0.5 million in deferred financing costs related to its prior credit facility, and incurred a total of $3.0 million in losses on extinguishment of debt related to its 2015 debt repayments.

Schedule of interest incurred and expensed

Total interest incurred and expensed on the notes payable for the years ended December 31, 2017, 2016 and 2015 was as follows (in thousands):

	2017		2016		2015
Interest expense on debt and capital lease obligations	$	46,251	$	49,509	$	63,677
Noncash interest on derivatives and capital lease obligations, net		3,106		(1,426)		(309)
Amortization of deferred financing fees		2,409		2,200		3,148
Total interest expense	$	51,766	$	50,283	$	66,516