Company: DRH-PA
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001298946-25-000077
Chunk: 85

Company: DiamondRock Hospitality Co
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 8
Chunk 85
---
 by the Courtyard New York Manhattan/Midtown East in the third quarter of 2024 and the Worthington Renaissance Fort Worth Hotel in the second quarter of 2025, as well as a lower SOFR rate in 2025.

Liquidity and Capital Resources

Our short-term liquidity requirements consists primarily of funds necessary to pay our scheduled debt service, near term debt maturities, operating expenses, ground lease payments, capital expenditures directly associated with our hotels, any share repurchases, distributions to our common and preferred stockholders, and the cost of acquiring additional hotels. 

As of June 30, 2025, we had two mortgage loans with maturities in July and November of 2025. On July 3, 2025, we repaid the mortgage loan secured by the Hotel Clio, using proceeds from our senior unsecured revolving credit facility. We subsequently repaid the draw on our senior unsecured revolving credit facility using the proceeds from our Amended Credit Facility. In addition, we plan to use proceeds from our Amended Credit Facility to repay the remaining mortgage loan that matures in November 2025. As of June 30, 2025, we had $400.0 million of borrowing capacity under our senior unsecured revolving credit facility.

Our mortgage debt agreements contain “cash trap” provisions that are triggered when the hotel’s operating results fall below a certain debt service coverage ratio. When these provisions are triggered, all of the excess cash flow generated by the hotel is deposited directly into cash management accounts for the benefit of our lenders until a specified debt service coverage ratio is reached and maintained for a certain period of time. Such provisions do not allow the lender the right to accelerate repayment of the underlying debt. We had no cash traps in effect as of June 30, 2025.

Our long-term liquidity requirements consist primarily of funds necessary to pay for the costs of acquiring additional hotels, renovations and other capital expenditures that need to be made periodically to our hotels, scheduled debt payments, debt maturities, certain redemptions of limited operating partnership units (“common OP units”), ground lease payments, share repurchases, and making distributions to our common and preferred stockholders. We expect to meet our long-term liquidity requirements through various sources of capital, including cash provided by operations, borrowings, issuances of additional equity, including common OP units, and/or debt securities and proceeds from property dispositions. Our ability to incur additional debt is dependent upon a number of factors, including the state of the