RLJ Lodging TrustRLJ
RLJ Lodging Trust Debt Disclosure
Debt
(1)Excludes a $1.1 million fair value adjustment on debt.
The Company's debt consisted of the following (in thousands):
| December 31, 2025 | December 31, 2024 | ||||||||||
| Senior Notes, net | $ | 996,401 | $ | 994,037 | |||||||
| Revolver Outstanding | — | 100,000 | |||||||||
| Term Loans, net | 1,020,057 | 918,707 | |||||||||
| Mortgage loans, net | 180,760 | 207,337 | |||||||||
| Debt, net | $ | 2,197,218 | $ | 2,220,081 | |||||||
Senior Notes
The Company's senior notes (collectively, the "Senior Notes") consisted of the following (dollars in thousands):
| Carrying Value at | ||||||||||||||||||||||||||
| Interest Rate at December 31, 2025 | Maturity Date | December 31, 2025 | December 31, 2024 | |||||||||||||||||||||||
| 2029 Senior Notes (1)(2) | 4.00% | September 2029 | $ | 500,000 | $ | 500,000 | ||||||||||||||||||||
| 2026 Senior Notes (1)(3) | 3.75% | July 2026 | 500,000 | 500,000 | ||||||||||||||||||||||
| 1,000,000 | 1,000,000 | |||||||||||||||||||||||||
| Deferred financing costs, net | (3,599) | (5,963) | ||||||||||||||||||||||||
| Total senior notes, net | $ | 996,401 | $ | 994,037 | ||||||||||||||||||||||
(1)Requires payments of interest only through maturity.
(2)The Company has the option to redeem its 4.00% senior notes due 2029 (the "2029 Senior Notes") at a redemption price of (i) 101.0% of the principal amount should such redemption occur before September 15, 2026 and (ii) 100.0% of the principal amount thereafter, in each case plus accrued and unpaid interest, if any.
(3)The Company has the option to redeem its 3.75% senior notes due 2026 (the "2026 Senior Notes") at a redemption price of 100.0% of the principal amount, plus accrued and unpaid interest, if any.
The Senior Notes are each fully and unconditionally guaranteed, jointly and severally, by the Company and certain of the Operating Partnership’s subsidiaries that incur and guarantee indebtedness under the Company’s credit facilities and certain other indebtedness. The indentures governing the Senior Notes contain customary covenants that limit the Operating Partnership’s ability and, in certain instances, the ability of its subsidiaries, to incur additional debt, create liens on assets, make distributions and pay dividends, make certain types of investments, issue guarantees of indebtedness, and make certain restricted payments. These limitations are subject to a number of exceptions and qualifications set forth in the indentures.
A summary of the various restrictive covenants for the Senior Notes are as follows:
| Covenant | Compliance December 31, 2025 | |||||||||||||
| Maintenance Covenant | ||||||||||||||
| Unencumbered Asset to Unencumbered Debt Ratio | > 150.0% | Yes | ||||||||||||
| Incurrence Covenants | ||||||||||||||
| Consolidated Indebtedness less than Adjusted Total Assets | < .65x | Yes | ||||||||||||
| Consolidated Secured Indebtedness less than Adjusted Total Assets | < .45x | Yes | ||||||||||||
| Interest Coverage Ratio | > 1.5x | Yes | ||||||||||||
Revolver and Term Loans
The Company had the following unsecured credit agreements in place as of December 31, 2025:
•$600.0 million revolving credit facility with a scheduled maturity date of May 10, 2027 and either a one-year extension option or up to two six-month extension options if certain conditions are satisfied (the "Revolver");
•$500.0 million term loan with a scheduled maturity date of September 24, 2027 and up to two one-year extension options if certain conditions are satisfied (the "$500 Million Term Loan Maturing 2027");
•$300.0 million term loan with a scheduled maturity date of April 3, 2028 and up to two one-year extension options if certain conditions are satisfied (the "$300 Million Term Loan Maturing 2028"); and
•$225.0 million term loan with a scheduled maturity date of May 10, 2026 and up to two one-year extension options if certain conditions are satisfied (the "$225 Million Term Loan Maturing 2026").
The $500 Million Term Loan Maturing 2027, the $300 Million Term Loan Maturing 2028, and the $225 Million Term
Loan Maturing 2026 are collectively referred to as the "Term Loans." The credit agreements contain certain financial covenants relating to the Company’s maximum leverage ratio, minimum fixed charge coverage ratio, maximum secured indebtedness ratio, maximum unencumbered leverage ratio and minimum unencumbered debt service coverage ratio. If an event of default exists, the Company is not permitted to make distributions to shareholders, other than those required to qualify for and maintain REIT status.
The borrowings under the Revolver and Term Loans bear interest at variable rates equal to (i) the Secured Overnight Financing Rate ("SOFR") plus a credit spread adjustment of ten basis points ("Adjusted SOFR") and a margin ranging from 1.35% to 2.20% or (ii) a base rate plus a margin ranging from 0.35% to 1.20%. In all cases, the actual margin used is determined based on the Company’s leverage ratio, as calculated under the terms of each facility. The Company incurs an unused facility fee on the Revolver of between 0.20% and 0.25%, based on the amount by which the maximum borrowing amount exceeds the total principal balance of the outstanding borrowings.
In April 2025, the Company refinanced a $200.0 million term loan with a scheduled maturity date of January 31, 2026 (the "$200 Million Term Loan Maturing 2026") to upsize the term loan to $300.0 million and extend the initial maturity to April 2028, with two additional one-year extension options at the Company's discretion, subject to certain conditions. Borrowings under the term loan bear interest at a variable rate under the same pricing grid as the $200 Million Term Loan Maturing 2026. The Company paid approximately $1.9 million in lender fees and legal costs related to the financing. In April 2025, the Company utilized the incremental $100.0 million in proceeds to pay off the full outstanding balance on the Revolver.
The Company's unsecured credit agreements consisted of the following (in thousands):
| Carrying Value at | ||||||||||||||||||||||||||
| Interest Rate at December 31, 2025 (1) | Maturity Date | December 31, 2025 | December 31, 2024 | |||||||||||||||||||||||
| Revolver (2) | —% | May 2027 | $ | — | $ | 100,000 | ||||||||||||||||||||
$500 Million Term Loan Maturing 2027 | 4.85% | September 2027 (3) | 500,000 | 500,000 | ||||||||||||||||||||||
$300 Million Term Loan Maturing 2028 (4) | 5.54% | April 2028 (3) | 300,000 | 200,000 | ||||||||||||||||||||||
$225 Million Term Loan Maturing 2026 (5) | 5.01% | May 2026 (3) | 225,000 | 225,000 | ||||||||||||||||||||||
| 1,025,000 | 1,025,000 | |||||||||||||||||||||||||
| Deferred financing costs, net (6) | (4,943) | (6,293) | ||||||||||||||||||||||||
| Total Revolver and Term Loans, net | $ | 1,020,057 | $ | 1,018,707 | ||||||||||||||||||||||
(1)Interest rate at December 31, 2025 gives effect to interest rate hedges.
(2)At December 31, 2025 and 2024, there was $600.0 million and $500.0 million, respectively, of borrowing capacity on the Revolver. In February 2026, the Company amended its Revolver. The amendment extends the maturity date of the Revolver to February 2030. The Company has the ability to further increase the total capacity on the Revolver to $750.0 million, subject to obtaining additional commitments from new or existing lenders and the satisfaction of certain customary conditions. The Company also has the ability to extend the maturity date for an additional one-year period or up to two six-month periods ending February 2031 if certain conditions are satisfied.
(3)As of December 31, 2025, this term loan includes two one-year extension options at the Company's discretion, subject to certain conditions.
(4)In April 2025, the Company refinanced this term loan to increase the loan amount to $300.0 million and extend the initial maturity to April 2028, with two additional one-year extension options at the Company's discretion, subject to certain conditions.
(5)In February 2026, the Company refinanced this term loan to extend the scheduled maturity date to February 2031 and upsize it to a delayed draw term loan of $569.0 million, of which $225.0 million has been funded and $344.0 million of commitments remain available to be drawn by the Company.
(6)Excludes $2.2 million and $3.9 million as of December 31, 2025 and 2024, respectively, related to deferred financing costs on the Revolver, which are included in prepaid expense and other assets in the accompanying consolidated balance sheets.
In addition to the debt transactions noted in the table above, in February 2026, the Company entered into a new $150.0 million delayed draw term loan which matures in February 2033.
The Company paid approximately $6.0 million in lender fees and legal costs in connection with the Revolver and approximately $8.0 million in lender fees and legal costs in connection with the term loan refinancing transactions.
The Revolver and Term Loans are subject to various financial covenants. A summary of the most restrictive covenants is as follows:
| Covenant | Compliance December 31, 2025 | |||||||||||||
| Leverage ratio (1) | <= 7.25x | Yes | ||||||||||||
| Fixed charge coverage ratio (2) | >= 1.50x | Yes | ||||||||||||
| Secured indebtedness ratio | <= 45.0% | Yes | ||||||||||||
| Unencumbered indebtedness ratio | <= 60.0% | Yes | ||||||||||||
| Unencumbered debt service coverage ratio | >= 2.00x | Yes | ||||||||||||
(1)Leverage ratio is net indebtedness, as defined in the Revolver and Term Loan agreements, to corporate earnings before interest, taxes, depreciation, and amortization ("EBITDA"), as defined in the Revolver and Term Loan agreements.
(2)Fixed charge coverage ratio is Adjusted EBITDA, generally defined in the Revolver and Term Loan agreements as EBITDA less FF&E reserves, to fixed charges, which is generally defined in the Revolver and Term Loan agreements as interest expense, all regularly scheduled principal payments, preferred dividends paid, and cash taxes paid.
Mortgage Loans
The Company's mortgage loans consisted of the following (in thousands):
| Carrying Value at | ||||||||||||||||||||||||||||||||
| Number of Assets Encumbered | Interest Rate at December 31, 2025 | Maturity Date | December 31, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||
| Mortgage loan (1)(2) | 2 | 5.39% | (4) | April 2026 | (5) | $ | 69,750 | $ | 96,000 | |||||||||||||||||||||||
| Mortgage loan (1) | 4 | 5.39% | (4) | April 2026 | (5) | 85,000 | 85,000 | |||||||||||||||||||||||||
| Mortgage loan (3) | 1 | 5.06% | January 2029 | 26,112 | 26,472 | |||||||||||||||||||||||||||
| 7 | 180,862 | 207,472 | ||||||||||||||||||||||||||||||
| Deferred financing costs, net | (102) | (135) | ||||||||||||||||||||||||||||||
| Total mortgage loans, net | $ | 180,760 | $ | 207,337 | ||||||||||||||||||||||||||||
(1)The hotels encumbered by the mortgage loan are cross-collateralized. Requires payments of interest only through maturity.
(2)In December 2025, the Company paid down $26.3 million of this mortgage loan in connection with the sale of one of the hotels securing this mortgage loan.
(3)Includes $1.1 million and $1.5 million at December 31, 2025 and 2024, respectively, related to a fair value adjustment on this mortgage loan from purchase price allocation at hotel property acquisition. This mortgage loan requires payments of interest only through maturity.
(4)Interest rate at December 31, 2025 gives effect to interest rate hedges.
(5)In April 2025, the Company exercised the final option to extend the maturity to April 2026. In January 2026, the Company amended these mortgage loans, extending the initial maturity date to April 2029, with two one-year extension options at the Company's discretion, subject to certain conditions. On the $69.8 million and $85.0 million mortgage loans, the Company paid down approximately $1.5 million and $3.9 million, respectively, in principal in connection with the amendments. The amended $69.8 million mortgage loan ($68.3 million after principal paydown) allows a future advance of up to $23.4 million by April 2026 with the addition of another hotel property previously unencumbered, with the combined outstanding principal balance of both mortgage loans not to exceed $164.4 million. The mortgage loans require payments of interest only through maturity.
Certain mortgage agreements are subject to various maintenance covenants requiring the Company to maintain a minimum debt yield or debt service coverage ratio ("DSCR"). Failure to meet the debt yield or DSCR thresholds is not an event of default, but instead triggers a cash trap event. At December 31, 2025, all mortgage loans exceeded the minimum debt yield or DSCR thresholds.
Interest Expense
The components of the Company's interest expense consisted of the following (in thousands):
| For the year ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Senior Notes | $ | 38,764 | $ | 38,764 | $ | 38,764 | |||||||||||
| Revolver and Term Loans | 54,851 | 50,928 | 31,000 | ||||||||||||||
| Mortgage loans | 10,555 | 13,451 | 21,014 | ||||||||||||||
| Amortization of deferred financing costs | 7,551 | 6,623 | 6,100 | ||||||||||||||
| Non-cash interest expense related to interest rate hedges | 577 | 1,592 | 1,929 | ||||||||||||||
| Total interest expense | $ | 112,298 | $ | 111,358 | $ | 98,807 | |||||||||||
Future Minimum Principal Payments
As of December 31, 2025, excluding extension options, the future minimum principal payments were as follows (in thousands):
| 2026 | $ | 879,750 | |||
| 2027 | 500,000 | ||||
| 2028 | 300,000 | ||||
| 2029 | 525,000 | ||||
| 2030 | — | ||||
| Thereafter | — | ||||
| Total (1) | $ | 2,204,750 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 26, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 26, 2020 | |
| 2018 | Mar 1, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Feb 23, 2017 | |
| 2015 | Feb 25, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.