Fair Value of Assets and Liabilities

12 Months Ended

Dec. 31, 2012

Fair Value of Assets and Liabilities

Fair Value of Assets and Liabilities

12. Fair Value of Assets and Liabilities

        The table below presents certain of our assets carried at fair value at December 31, 2012, categorized by the level of inputs, as defined in the fair value hierarchy under GAAP, used in the valuation of each asset.

			Fair Value at Reporting Date Using
Description	Year Ended December 31, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Total Gains (Losses), Net
Properties held for sale(1)	$	—	$	—	$	(889	)
Investment securities(2)	$	11,938	$	11,938	$	—

(1)

We sold one Marriott hotel we held for sale at December 31, 2011 in July 2012. We removed 20 Marriott branded hotels with a carrying value of $104,585 we held for sale at December 31, 2011 from held for sale status in March 2012. As described in Note 5, we have agreed to retain 18 of these hotels in our Marriott No. 234 agreement and retained and rebranded the remaining two hotels to Sonesta brands and management. We recorded an $889 loss on asset impairment in the first quarter of 2012 in connection with our decision to remove these hotels from held for sale status.

(2)

Our investment securities, consisting of our 2,540,000 shares of TA, which are included in our other assets, are reported at fair value which is based on quoted market prices (Level 1 inputs). Our historical cost basis for these securities is $9,267. The unrealized gain for these securities as of December 31, 2012, is included in cumulative other comprehensive income in our Consolidated Balance Sheets.

        In addition to the investment securities included in the table above, our financial instruments include our cash and cash equivalents, restricted cash, revolving credit facility, unsecured term loan, senior notes and security deposits. At December 31, 2012 and December 31, 2011, the fair values of these additional financial instruments were not materially different from their carrying values, except as follows:

	December 31, 2012					December 31, 2011
	Carrying Amount			Fair Value		Carrying Amount			Fair Value
Senior Notes, due 2012 at 6.85%	$	—		$	—	$	100,829		$	105,407
Senior Notes, due 2013 at 6.75%		—			—		287,000			301,871
Senior Notes, due 2014 at 7.875%		300,000			333,360		300,000			333,887
Senior Notes, due 2015 at 5.125%		280,000			298,926		280,000			290,052
Senior Notes, due 2016 at 6.3%		275,000			306,078		275,000			291,572
Senior Notes, due 2017 at 5.625%		300,000			335,173		300,000			313,106
Senior Notes, due 2018 at 6.7%		350,000			417,293		350,000			386,942
Senior Notes, due 2022 at 5.0%		500,000			531,343		—			—
Convertible Senior Notes, due 2027 at 3.8%		8,478			9,092		79,054			80,087
Unamortized discounts		(11,120	)		—		(5,169	)		—
Total financial liabilities	$	2,002,358		$	2,231,265	$	1,966,714		$	2,102,924

        We estimate the fair value of our indebtedness using discounted cash flow analyses and currently prevailing market interest rates (Level 3 inputs).