Derivative Instruments and Hedging Activities

12 Months Ended

Dec. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

11. Derivative Instruments and Hedging Activities

We may be exposed to the risk associated with variability of interest rates that might impact our cash flows and the results of operations.  The hedging strategy of entering into interest rate caps and swaps, therefore, is to eliminate or reduce, to the extent possible, the volatility of cash flows.

As of December 31, 2017, we did not have any derivative instruments. As of December 31, 2016, we had an interest rate cap related to the associated indebtedness of the Courtyard Kauai Coconut Beach Hotel, which was not designated as a hedging instrument. This interest rate cap matured on May 15, 2017 and had a notional value of $38 million at a rate of 30-day LIBOR +  3%.