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Organization
 12 Months Ended
Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization
Note 1. Organization
Service Properties Trust, or we, us or our, is a real estate investment trust, or REIT, organized on February 7, 1995 under the laws of the State of Maryland, which invests in hotels and net lease service-oriented retail properties. At December 31, 2020, we owned, directly and through subsidiaries, 310 hotels and 799 net lease properties.
At December 31, 2020, 305 of our 310 hotels were managed or operated by subsidiaries of the following companies: Sonesta Holdco Corporation, or Sonesta, (168 hotels), Marriott International, Inc., or Marriott (105 hotels), Hyatt Hotels Corporation, or Hyatt (22 hotels), Radisson Hospitality, Inc., or Radisson (nine hotels) and InterContinental Hotels Group, plc, or IHG (one hotel). We have entered into an agreement to sell five hotels and we have entered into a short term lease with the buyer in anticipation of the sale. At December 31, 2020, we owned 799 net lease properties with 170 tenants, including 179 travel centers leased to TravelCenters of America Inc., or TA, our largest tenant. Hereinafter, these companies are sometimes referred to as managers and/or tenants, or collectively, operators.
Recent Events
The novel coronavirus, or COVID-19, global pandemic, along with federal, state and local government mandates have disrupted and are expected to continue to have a significant negative impact on our results of operations, financial position and cash flow. In the United States, individuals are being encouraged to practice social distancing, are restricted from gathering in large groups, and in some areas, either have been or are subject to mandatory stay-at-home restrictions, which have restricted or prohibited large social gatherings, travel and non-essential activities outside of their homes. As a result, the lodging industry and other industries in which our managers and tenants operate have been adversely impacted.
Our results of operations and cash flows from our hotels are heavily dependent on our operators’ ability to generate returns to us and their willingness to fund shortfalls in our minimum returns from their own resources. IHG defaulted on its agreement with us and Marriott did not fund shortfalls in the payment of our minimum returns in accordance with its agreement with us. We have terminated our agreements with both IHG and Marriott and have transitioned the branding and management of 193 hotels previously managed by IHG, Marriott and Wyndham to Sonesta between September 2020 and February 2021.
As a result of the disruption caused by the COVID-19 pandemic, we have taken steps to preserve liquidity by reducing our quarterly distribution to our shareholders beginning in the second quarter of 2020 to $0.01 per share and we expect our quarterly distribution to continue at that rate for the foreseeable future, subject to applicable REIT tax requirements, by reducing expected capital expenditures, and by working with our hotel operators to reduce hotel operating expenses, raising $1,229,950 of debt proceeds, repaying $800,000 of debt, selling assets for an aggregate sales price of $174,172, excluding closing costs, and entering into an agreement to sell additional properties for an aggregate sales price of $24,313, excluding sales costs. We and our lenders amended our credit agreement governing our $1,000,000 revolving credit facility and $400,000 term loan on May 8, 2020. Among other things, the amendment waived certain existing financial covenants through the end of the first quarter of 2021. Based on the prolonged effect of the pandemic and our expectations of not being able to meet the financial covenants under our amended credit agreement, we entered into an additional amendment on November 5, 2020. Among other things, the amendment waives all of the existing financial covenants through the end of the agreement term, or July 15, 2022, or the New Waiver Period. On January 19, 2021, we borrowed $972,793 under our revolving credit facility as a precautionary measure to preserve financial flexibility. As of February 26, 2021, we are fully drawn under our revolving credit facility. Based on these actions, the cash flows we receive from our net lease portfolio, the financing activities we have completed, and asset dispositions we have completed or expect to complete, we believe we will have sufficient liquidity to meet our obligations for at least the next twelve months. See Notes 5 and 6 for additional information regarding the transactions and other actions described above.