BETHESDA, Md. (Bloomberg) — Host Marriott Corp., which had a 26 percent drop in demand for its hotel rooms in October, amended its loan agreements and suspended the 26-cent dividend payment on its common shares to save cash.
Host Marriott's lenders agreed to let the real estate investment trust carry more debt relative to cash flow, among other concessions, the company said. In exchange for relaxed debt terms, which last through Aug. 15, the company said it would pay interest rates 25 basis points to 75 basis points higher.
Maryland-based Host Marriott, an owner of 124 hotels including Hyatts and Four Seasons, will save $68 million by suspending the dividend payment this quarter. It joined hotel companies such as Starwood Hotels & Resorts Worldwide Inc. that have amended debt terms and adjusted their dividend schedules to save cash amid the worst drop in hotel demand in 34 years.