Debt

The Company's mortgage loans and its senior unsecured revolving credit facility are collateralized by first-mortgage liens on certain of the Company's properties. The mortgages are non-recourse except for instances of fraud or misapplication of funds. Debt consisted of the following (in thousands):



Loan/Collateral	Interest Rate		Maturity Date	12/31/17 Property Carrying Value		Balance Outstanding as of
Loan/Collateral	Interest Rate		Maturity Date	12/31/17 Property Carrying Value		December 31, 2017			December 31, 2016
Senior Unsecured Revolving Credit Facility (1)	4.17	%	November 25, 2019	$	—	$	32,000		$	52,500
Residence Inn by Marriott New Rochelle, NY	5.75	%	September 1, 2021	19,222		13,762			14,141
Residence Inn by Marriott San Diego, CA	4.66	%	February 6, 2023	45,958		28,469			29,026
Homewood Suites by Hilton San Antonio, TX	4.59	%	February 6, 2023	32,173		16,253			16,575
Residence Inn by Marriott Vienna, VA	4.49	%	February 6, 2023	30,287		22,251			22,699
Courtyard by Marriott Houston, TX	4.19	%	May 6, 2023	32,371		18,375			18,758
Hyatt Place Pittsburgh, PA	4.65	%	July 6, 2023	35,199		22,437			22,864
Residence Inn by Marriott Bellevue, WA	4.97	%	December 6, 2023	67,418		45,462			46,206
Residence Inn by Marriott Garden Grove, CA	4.79	%	April 6, 2024	38,643		33,160			33,674
Residence Inn by Marriott Silicon Valley I, CA	4.64	%	July 1, 2024	79,584		64,800			64,800
Residence Inn by Marriott Silicon Valley II, CA	4.64	%	July 1, 2024	86,974		70,700			70,700
Residence Inn by Marriott San Mateo, CA	4.64	%	July 1, 2024	63,012		48,600			48,600
Residence Inn by Marriott Mountain View, CA	4.64	%	July 1, 2024	55,162		37,900			37,900
SpringHill Suites by Marriott Savannah, GA	4.62	%	July 6, 2024	36,393		30,000			30,000
Hilton Garden Inn Marina del Rey, CA (2)	4.68	%	July 6, 2024	41,906		21,760			22,145
Homewood Suites by Hilton Billerica, MA	4.32	%	December 6, 2024	12,191		16,225			16,225
Homewood Suites by Hilton Carlsbad, CA	4.32	%	December 6, 2024	—		—			19,950
Hampton Inn & Suites Houston Medical Cntr., TX	4.25	%	January 6, 2025	15,116		18,300			18,300
Total debt before unamortized debt issue costs				$	691,609	$	540,454		$	585,063
Unamortized mortgage debt issue costs						(2,138		)	(2,240		)
Total debt outstanding						538,316			582,823


(1)	The interest rate for the senior unsecured revolving credit facility is variable and based on LIBOR plus an applicable margin ranging from 1.55% to 2.3%, or prime plus an applicable margin of 0.55% to 1.3%.


(2)	On September 17, 2015, the Company assumed the mortgage loan secured by a first mortgage on the Hilton Garden Inn Marina del Rey hotel. The loan has a 10-year term, a 30-year amortization payment schedule.

On November 25, 2015, the Company, as parent guarantor, and the Operating Partnership, as borrower, entered into a new unsecured revolving credit agreement with the lenders party thereto, Barclays Bank PLC, Citigroup Global Markets Inc., Regions Capital Markets and U.S. Bank National Association as joint lead arrangers, Barclays Bank PLC as administrative agent, Regions Bank as syndication agent and Citibank, N.A. and U.S. Bank National Association as co-documentation agents (the “New Credit Agreement”). The New Credit Agreement has an initial maturity date of November 25, 2019, which may be extended for an additional year upon the payment of applicable fees and satisfaction of certain customary conditions. In connection with the entry into the New Credit Agreement, the Company and the Operating Partnership terminated the Amended and Restated Credit Agreement, dated as of November 5, 2012, as amended, among the Company, the Operating Partnership, the lenders party thereto, Barclays Capital Inc. and Regions Capital Markets as joint lead arrangers, Barclays Bank PLC as administrative agent, Regions Bank as syndication agent, Credit Agricole Corporate and Investment Bank, UBS Securities and US Bank National Association as co-documentation agents (the "Existing Credit Agreement"), which was composed of a secured revolving credit facility that provided borrowing capacity of up to $175.0 million. Proceeds under the New Credit Agreement were used to repay outstanding borrowings under the Existing Credit Agreement. The New Credit Agreement includes limitations on the extent of allowable distributions from the operating partnership to the Company not to exceed the greater of 95% of adjusted funds from operations and the minimum amount of distributions required for the Company to maintain its REIT status. Other key terms are as follows:



Borrowing Capacity:		Up to $250.0 Million
Accordion feature:		Increase borrowing capacity by up to additional $150.0 million
Interest rate:		Floating rate based on LIBOR plus 155-230 basis points, based on leverage ratio
Unused fee:		20 basis points if less than 50% unused, 30 basis points if more than 50% unused
Maximum leverage ratio:		60%
Minimum fixed charge coverage ratio:		1.5x

At December 31, 2017 and 2016, the Company had $32.0 million and $52.5 million, respectively, of outstanding borrowings under its senior unsecured revolving credit facility. At December 31, 2017, the maximum borrowing availability under the senior unsecured revolving credit facility was $250.0 million.

The Company estimates the fair value of its fixed rate debt by discounting the future cash flows of each instrument at estimated market rates. All of the Company's mortgage loans are fixed-rate. Rates take into consideration general market conditions, quality and estimated value of collateral and maturity of debt with similar credit terms and are classified within level 3 of the fair value hierarchy. The estimated fair value of the Company’s fixed rate debt as of December 31, 2017 and 2016 was $506.6 million and $516.0 million, respectively.

The Company estimates the fair value of its variable rate debt by taking into account general market conditions and the estimated credit terms it could obtain for debt with a similar maturity and that is classified within level 3 of the fair value hierarchy. As of December 31, 2017, the Company’s only variable rate debt is under its senior unsecured revolving credit facility. The estimated fair value of the Company’s variable rate debt as of December 31, 2017 and 2016 was $32.0 million and $52.5 million, respectively.

As of December 31, 2017, the Company was in compliance with all of its financial covenants. At December 31, 2017, the Company’s consolidated fixed charge coverage ratio was 3.2 and the bank covenant is 1.5. Future scheduled principal payments of debt obligations as of December 31, 2017, for each of the next five calendar years and thereafter are as follows (in thousands):



	Amount
2018	$	5,041
2019	38,992
2020	9,536
2021	21,945
2022	9,954
Thereafter	454,986
Total	$	540,454