XML 37 R23.htm IDEA: XBRL DOCUMENT v3.22.4
Debt & Non-recourse Debt
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
Debt & Non-recourse Debt Debt & Non-recourse Debt
Debt
The following table details our outstanding debt balance and its associated interest rates:
December 31,
($ in millions)20222021
Debt(1)
Senior secured credit facility
Term loan with a rate of 7.384%, due 2028
$1,284 $1,297 
Revolver with a rate of 6.020%, due 2026
40 300 
Senior notes with a rate of 5.000%, due 2029
850 850 
Senior notes with a rate of 4.875%, due 2031
500 500 
Other debt29 27 
Total debt, gross2,703 2,974 
Less: unamortized deferred financing costs and discounts(2)(3)
(52)(61)
Total debt, net$2,651 $2,913 
(1)As of December 31, 2022 and 2021, weighted-average interest rates were 6.143% and 4.052% , respectively.
(2)Amount includes unamortized deferred financing costs related to our term loan and senior notes of $26 million and $19 million, respectively, as of December 31, 2022 and $33 million and $22 million, respectively, as of December 31, 2021. This amount also includes original issuance discounts of $7 million and $6 million as of December 31, 2022 and 2021, respectively.
(3)Amount does not include unamortized deferred financing costs of $4 million and $5 million as of December 31, 2022 and 2021, respectively, related to our revolving facility included in Other Assets in our consolidated balance sheets.
Senior Secured Credit Facilities
During the year ended December 31, 2022, we repaid $313 million under the senior secured credit facilities. As of December 31, 2022, we had $1 million of letters of credit outstanding under the revolving credit facility and $1 million outstanding backed by cash collateral. We were in compliance with all applicable maintenance and financial covenants and ratios as of December 31, 2022. As of December 31, 2022, we have $959 million remaining borrowing capacity under the revolver facility.
We primarily use interest rate swaps as part of our interest rate risk management strategy for our variable-rate debt. These interest rate swaps are associated with the remaining available LIBOR based senior secured credit facility.
Therefore as of December 31, 2022, these interest rate swaps convert the LIBOR based variable rate on our Term Loan to average fixed rates of 1.32% per annum with maturities between 2023 and 2028, for the balance on this borrowing up to the notional values of our interest rate swaps. As of December 31, 2022, the notional values of the interest rate swaps under our Term Loan was $708 million. Our interest rate swaps have been designated and qualify as cash flow hedges of interest rate risk and recorded at their estimated fair value as an asset in Other assets in our consolidated balance sheets. As of December 31, 2022 and 2021, the estimated fair value of our cash flow hedges was $63 million and $2 million, respectively. We characterize payments we make in connection with these derivative instruments as interest expense and a reclassification of accumulated other comprehensive income for presentation purposes. The following table reflects the activity in accumulated other comprehensive income related to our derivative instruments during the year ended December 31, 2022:
Net unrealized gain on derivative instruments
Balance as of December 31, 2021$2 
Other comprehensive income before reclassifications, net50 
Reclassification to net income(4)
Balance as of December 31, 2022$48 
Senior Notes due 2029 and 2031
The Senior Unsecured Notes are guaranteed on a senior unsecured basis by certain of our subsidiaries. We are in compliance with all applicable financial covenants as of December 31, 2022.
Non-recourse Debt
The following table details our outstanding non-recourse debt balance and its associated interest rates:
 December 31,
($ in millions)20222021
Non-recourse debt(1)
Timeshare Facility with an average rate of 5.320%, due 2025(3)
$98 $131 
HGV Securitized Debt with a weighted average rate of 2.711%, due 2028
42 70 
HGV Securitized Debt with a weighted average rate of 3.602%, due 2032
98 143 
HGV Securitized Debt with a weighted average rate of 2.431%, due 2033
101 151 
HGV Securitized Debt with a weighted average rate of 3.658%, due 2034
134 — 
HGV Securitized Debt with a weighted average rate of 4.826%, due 2037
251 — 
HGV Securitized Debt with a weighted average rate of 4.304%, due 2039
168 193 
Diamond Resorts Premium Yield Facility with an average rate of 4.766%, due 2031
— 8 
Diamond Resorts Conduit Facility with an average rate of 2.250%, due 2023
— 125 
Diamond Resorts Conduit Facility with an average rate of 3.00%, due 2024
— 8 
Diamond Resorts Owner Trust 2017 with a weighted average rate of 3.504%, due 2029
— 41 
Diamond Resorts Owner Trust 2018 with a weighted average rate of 4.061%, due 2031
— 92 
Diamond Resorts Owner Trust 2019 with a weighted average rate of 3.255%, due 2032
87 148 
Diamond Resorts Owner Trust 2021 with a weighted average rate of 2.160%, due 2033
134 224 
Total face value1,113 1,334 
Less: unamortized deferred financing costs(2)
(11)(6)
Total non-recourse debt, net$1,102 $1,328 
(1)As of December 31, 2022 and 2021, weighted-average interest rates were 3.539% and 2.876%, respectively.
(2)Amount relates to securitized debt only and does not include unamortized deferred financing costs of $4 million and $2 million as of December 31, 2022 and 2021, respectively, relating to our Timeshare Facility included in Other Assets in our consolidated balance sheets.
(3)In connection with the amended and restated Timeshare Facility executed in May 2022, the revolving commitment period of the Timeshare Facility terminates in May 2024, however the repayment maturity date extends 12 months beyond the commitment termination date to May 2025.
During the year ended December 31, 2022, we repaid and terminated our conduit facilities due in 2023 and 2024.
The Timeshare Facility is a non-recourse obligation payable solely from the pool of timeshare financing receivables pledged as collateral and related assets. In May 2022, we amended and restated our Timeshare Facility agreement under new terms, which include increasing the borrowing capacity from $450 million to $750 million, allowing us to borrow up to the maximum amount until May 2024 and requiring all amounts borrowed to be repaid in 2025. Under the amendment, the Timeshare Facility is subject to an interest rate of 0.910% plus one-month Secured Overnight Financing Rate ("SOFR") plus a SOFR adjustment of 0.110%. In connection with the amendment, we incurred $4 million in debt issuance costs.
In August 2022, we completed a securitization of $269 million of gross timeshare financing receivables and issued approximately $153 million of 4.30% notes, $73 million of 4.74% notes, $26 million of 5.57% notes, and $17 million of 8.73% notes due January 2037. The securitized debt is backed by pledged assets, consisting primarily of a pool of timeshare financing receivables secured by first mortgages or deeds of trust on timeshare interest. The securitized debt is a non-recourse obligation and is payable solely from the pool of timeshare financing receivables pledged as collateral to the debt. The proceeds were primarily used to pay down the Timeshare Facility and general corporate operating expenses. In connection with the securitization, we incurred $5 million in debt issuance costs.
In April 2022, we completed a securitization of $246 million of gross timeshare financing receivables and issued approximately $107 million of 3.61% notes, $84 million of 4.10% notes, $22 million of 4.69% notes, and $33 million of 6.79% notes due June 2034. The securitized debt is backed by pledged assets, consisting primarily of a pool of timeshare financing receivables secured by first mortgages or deeds of trust on timeshare interest and initially by a $34 million cash deposit. As of December 31, 2022, the cash deposit has been withdrawn due to subsequent collateralization of additional timeshare financing receivables. The securitized debt is a non-recourse obligation and is payable solely from the pool of timeshare financing receivables pledged as collateral to the debt. The proceeds were primarily used to pay down the remaining borrowings on one of our conduit facilities and general corporate operating expenses. In connection with the securitization, we incurred $4 million in debt issuance costs.
During the year ended December 31, 2022, we repaid $162 million on the Timeshare facility, $8 million on the Premium Yield Facility, $258 million on the conduit facilities, and $562 million on Securitized Debt.
We are required to deposit payments received from customers on the timeshare financing receivables securing the Timeshare Facility and Securitized Debt into depository accounts maintained by third parties. On a monthly basis, the depository accounts are utilized to make required principal, interest and other payments due under the respective loan agreements. The balances in the depository accounts were $50 million and $67 million as of December 31, 2022 and 2021, respectively, and were included in Restricted Cash in our consolidated balance sheets.
Debt Maturities
The contractual maturities of our debt and non-recourse debt as of December 31, 2022 were as follows:
($ in millions)DebtNon-recourse DebtTotal
Year
2023$16 $266 $282 
202415 214 229 
202514 257 271 
202653 130 183 
202713 93 106 
Thereafter2,592 153 2,745 
Total$2,703 $1,113 $3,816