HYATT HOTELS CORP, 10-K filed on 2/16/2017
Annual Report
Document and Entity Information Document (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Jun. 30, 2016
Jan. 31, 2017
Common Class A
Jan. 31, 2017
Common Class B
Document Information
 
 
 
 
Entity Registrant Name
Hyatt Hotels Corp 
 
 
 
Entity Central Index Key
0001468174 
 
 
 
Current Fiscal Year End Date
--12-31 
 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
 
Document Type
10-K 
 
 
 
Document Period End Date
Dec. 31, 2016 
 
 
 
Document Fiscal Year Focus
2016 
 
 
 
Document Fiscal Period Focus
FY 
 
 
 
Amendment Flag
false 
 
 
 
Trading Symbol
 
 
 
Entity Common Stock, Shares Outstanding
 
 
39,707,321 
90,863,209 
Entity Well-known Seasoned Issuer
Yes 
 
 
 
Entity Voluntary Filers
No 
 
 
 
Entity Current Reporting Status
Yes 
 
 
 
Entity Public Float
 
$ 1,123.1 
 
 
Consolidated Statements of Income (USD $)
In Millions, except Per Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
REVENUES:
 
 
 
Owned and leased hotels
$ 2,108 
$ 2,079 
$ 2,246 
Management and franchise fees
448 
427 
387 
Other revenues
40 
36 
75 
Other revenues from managed properties
1,833 
1,786 
1,707 
Total revenues
4,429 
4,328 
4,415 
DIRECT AND SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES:
 
 
 
Owned and leased hotels
1,610 
1,562 
1,691 
Depreciation and amortization
342 
320 
354 
Other direct costs
30 
29 
35 
Selling, general, and administrative
315 
308 
349 
Other costs from managed properties
1,833 
1,786 
1,707 
Direct and selling, general, and administrative expenses
4,130 
4,005 
4,136 
Net gains and interest income from marketable securities held to fund operating programs
19 
15 
Equity earnings (losses) from unconsolidated hospitality ventures
68 
(64)
25 
Interest expense
(76)
(68)
(71)
Gains (losses) on sales of real estate and other
(23)
311 
Asset impairments
(5)
(17)
Other income (loss), net
(5)
(17)
INCOME BEFORE INCOME TAXES
289 
194 
525 
PROVISION FOR INCOME TAXES
(85)
(70)
(179)
NET INCOME
204 
124 
346 
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
(2)
NET INCOME ATTRIBUTABLE TO HYATT HOTELS CORPORATION
$ 204 
$ 124 
$ 344 
EARNINGS PER SHARE—Basic
 
 
 
Net Income -Basic (in dollars per share)
$ 1.53 
$ 0.87 
$ 2.26 
Net income attributable to Hyatt Hotels Corporation - Basic (in dollars per share))
$ 1.53 
$ 0.87 
$ 2.25 
EARNINGS PER SHARE—Diluted
 
 
 
Net Income- Diluted (in dollars per share)
$ 1.52 
$ 0.86 
$ 2.24 
Net income attributable to Hyatt Hotels Corporation - Diluted (in dollars per share)
$ 1.52 
$ 0.86 
$ 2.23 
Consolidated Statements of Comprehensive Income (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Statement of Comprehensive Income [Abstract]
 
 
 
Net income
$ 204 
$ 124 
$ 346 
Other Comprehensive Income (Loss), Net of Taxes, Portion Attributable to Parent [Abstract]
 
 
 
Foreign currency translation adjustments, net of tax (benefit) expense of $-, $(2), and $1 for the years ended December 31, 2016, December 31, 2015, and December 31, 2014, respectively
(42)
(102)
(93)
Unrealized gains (losses) on available-for-sale securities, net of tax (benefit) expense of $(4), $21, and $2 for the years ended December 31, 2016, December 31, 2015, and December 31, 2014, respectively
(6)
33 
Unrecognized pension cost, net of tax benefit of $-, $-, and $(1) for the years ended December 31, 2016, December 31, 2015, and December 31, 2014, respectively
(2)
Unrealized gains on derivative activity, net of tax expense of $1, $1, and $1 for the years ended December 31, 2016, December 31, 2015, and December 31, 2014, respectively
Other comprehensive loss
(47)
(70)
(92)
COMPREHENSIVE INCOME
157 
54 
254 
COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
(2)
COMPREHENSIVE INCOME ATTRIBUTABLE TO HYATT HOTELS CORPORATION
$ 157 
$ 54 
$ 252 
Consolidated Statements of Comprehensive Income Parentheticals (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Statement of Comprehensive Income [Abstract]
 
 
 
Foreign currency translation adjustments, net of tax (benefit) expense
$ 0 
$ (2)
$ 1 
Unrealized gains (losses) on available-for-sale securities, net of tax (benefit) expense
(4)
21 
Unrecognized pension cost, net of tax benefit
(1)
Unrealized gains on derivative activity, net of tax expense
$ 1 
$ 1 
$ 1 
Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
CURRENT ASSETS:
 
 
Cash and cash equivalents
$ 482 
$ 457 
Restricted cash
76 
96 
Short-term investments
56 
46 
Receivables, net of allowances of $18 and $15 at December 31, 2016 and December 31, 2015, respectively
304 
298 
Inventories
28 
12 
Prepaids and other assets
153 
152 
Prepaid income taxes
40 
63 
Total current assets
1,139 
1,124 
Investments
186 
327 
Property and equipment, net
4,270 
4,031 
Financing receivables, net of allowances
19 
20 
Goodwill
125 
129 
Intangibles, net
599 
547 
Deferred tax assets
313 
301 
Other assets
1,098 
1,112 
TOTAL ASSETS
7,749 
7,591 
CURRENT LIABILITIES:
 
 
Current maturities of long-term debt
119 
328 
Accounts payable
162 
141 
Accrued expenses and other current liabilities
514 
516 
Accrued compensation and benefits
129 
122 
Total current liabilities
924 
1,107 
Long-term debt
1,445 
1,042 
Other long-term liabilities
1,472 
1,447 
Total liabilities
3,841 
3,596 
Commitments and contingencies
   
   
EQUITY:
 
 
Preferred Stock
Common stock
Additional paid-in capital
1,686 
1,931 
Retained earnings
2,493 
2,289 
Accumulated other comprehensive loss
(277)
(230)
Total stockholders’ equity
3,903 
3,991 
Noncontrolling interests in consolidated subsidiaries
Total equity
3,908 
3,995 
TOTAL LIABILITIES AND EQUITY
$ 7,749 
$ 7,591 
Consolidated Balance Sheet Parentheticals (USD $)
In Millions, except Share data, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Allowance for doubtful accounts receivable, current
$ 18 
$ 15 
Preferred stock, par or stated value per share (in dollars per share)
$ 0.01 
$ 0.01 
Preferred stock, shares authorized (in shares)
10,000,000 
10,000,000 
Preferred stock, shares outstanding (in shares)
Common Class A
 
 
Common stock, par or stated value per share (in dollars per share)
$ 0.01 
$ 0.01 
Common stock, shares authorized (in shares)
1,000,000,000 
1,000,000,000 
Common stock, shares, outstanding (in shares)
39,952,061 
26,604,687 
Common stock, shares, issued (in shares)
39,952,061 
26,604,687 
Common Class B
 
 
Common stock, par or stated value per share (in dollars per share)
$ 0.01 
$ 0.01 
Common stock, shares authorized (in shares)
422,857,621 
441,623,374 
Common stock, shares, outstanding (in shares)
90,863,209 
109,628,962 
Common stock, shares, issued (in shares)
90,863,209 
109,628,962 
Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
Net income
$ 204 
$ 124 
$ 346 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
342 
320 
354 
Amortization of share awards
26 
26 
52 
Deferred income taxes
(3)
(103)
(28)
Equity (earnings) losses from unconsolidated hospitality ventures and distributions received
(33)
100 
54 
(Gains) losses on sales of real estate and other
23 
(9)
(311)
Other
(38)
55 
(18)
Increase (decrease) in cash attributable to changes in assets and liabilities:
 
 
 
Restricted cash
(4)
78 
(18)
Receivables, net
(14)
29 
(28)
Inventories
Prepaid income taxes
21 
(16)
(53)
Accounts payable, accrued expenses and other current liabilities
(7)
186 
Accrued compensation and benefits
(9)
Other long-term liabilities
10 
(19)
Other, net
(61)
(66)
(43)
Net cash provided by operating activities
489 
538 
473 
CASH FLOWS FROM INVESTING ACTIVITIES:
 
 
 
Purchases of marketable securities and short-term investments
(464)
(530)
(421)
Proceeds from marketable securities and short-term investments
457 
521 
320 
Contributions to investments
(107)
(37)
(114)
Return of investments
132 
19 
57 
Acquisitions, net of cash acquired
(492)
(3)
(548)
Capital expenditures
(211)
(269)
(253)
Issuance of financing receivables
(38)
(8)
(5)
Proceeds from financing receivables
38 
28 
56 
Proceeds from sales of real estate and other, net of cash disposed
289 
88 
1,467 
Sales proceeds transferred to escrow as restricted cash
(870)
Sales proceeds transferred from escrow to cash and cash equivalents
29 
143 
714 
(Increase) decrease in restricted cash
(6)
19 
(8)
Other investing activities
(7)
(18)
(22)
Net cash (used in) provided by investing activities
(380)
(47)
373 
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
 
Proceeds from long-term debt, net of issuance costs of $4, $-, and $-, respectively
620 
12 
249 
Repayments of long-term debt
(438)
(5)
(208)
Repurchase of common stock
(272)
(715)
(443)
Repayment of capital lease obligation
(191)
Other financing activities
(6)
(7)
(14)
Net cash used in financing activities
(96)
(715)
(607)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
12 
(4)
(8)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
25 
(228)
231 
CASH AND CASH EQUIVALENTS—BEGINNING OF YEAR
457 
685 
454 
CASH AND CASH EQUIVALENTS—END OF PERIOD
482 
457 
685 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
 
 
 
Cash paid during the period for interest
75 
69 
71 
Cash paid during the period for income taxes
95 
145 
267 
Non-cash investing and financing activities are as follows:
 
 
 
Non-cash contributions to investments
13 
17 
Non-cash management and franchise agreement intangibles
47 
Change in accrued capital expenditures
$ 2 
$ 6 
$ 4 
Consolidated Statements of Cash Flows Parenthetical (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Statement of Cash Flows [Abstract]
 
 
 
Debt issuance cost
$ 4 
$ 0 
$ 0 
Consolidated Statement of Changes in Stockholders' Equity (USD $)
In Millions
Total
Common Stock Amount
Additional Paid-in Capital
Retained Earnings
Treasury Stock Amount
Accumulated Other Comprehensive Loss
Noncontrolling Interests in Consolidated Subsidiaries
Balance, beginning of period at Dec. 31, 2013
$ 4,777 
$ 2 
$ 3,015 
$ 1,821 
$ (1)
$ (68)
$ 8 
Total comprehensive income
254 
 
 
344 
 
(92)
Disposals of shares in noncontrolling interests
(4)
 
 
 
 
 
(4)
Repurchase of common stock
(445)
 
(445)
 
 
 
 
Directors compensation
 
 
 
 
 
Employee stock plan issuance
 
 
 
 
 
Share-based payment activity
45 
 
45 
 
 
 
 
Other
(1)
 
 
 
 
(2)
Balance, end of period at Dec. 31, 2014
4,631 
2,621 
2,165 
(1)
(160)
Total comprehensive income
54 
 
 
124 
 
(70)
 
Repurchase of common stock
(715)
(1)
(714)
 
 
 
 
Directors compensation
 
 
 
 
 
Employee stock plan issuance
 
 
 
 
 
Share-based payment activity
20 
 
19 
 
 
 
Balance, end of period at Dec. 31, 2015
3,995 
1,931 
2,289 
(230)
Total comprehensive income
157 
 
 
204 
 
(47)
 
Contributions from noncontrolling interests
 
 
 
 
 
Repurchase of common stock
(272)
 
(272)
 
 
 
 
Directors compensation
 
 
 
 
 
Employee stock plan issuance
 
 
 
 
 
Share-based payment activity
22 
 
22 
 
 
 
 
Balance, end of period at Dec. 31, 2016
$ 3,908 
$ 1 
$ 1,686 
$ 2,493 
$ 0 
$ (277)
$ 5 
Organization
Organization
ORGANIZATION
Hyatt Hotels Corporation, a Delaware corporation, and its consolidated subsidiaries (collectively "Hyatt Hotels Corporation") provide hospitality services on a worldwide basis through the development, ownership, operation, management, franchising, and licensing of hospitality related businesses. We develop, own, operate, manage, franchise, license or provide services to a portfolio of properties consisting of full service hotels, select service hotels, resorts and other properties, including timeshare, fractional and other forms of residential or vacation properties. At December 31, 2016, (i) we operated or franchised 315 full service hotels, comprising 123,117 rooms throughout the world, (ii) we operated or franchised 342 select service hotels, comprising 48,016 rooms, of which 313 hotels are located in the United States, and (iii) our portfolio of properties included 6 franchised all inclusive Hyatt-branded resorts, comprising 2,401 rooms. At December 31, 2016 our portfolio of properties operated in 56 countries around the world.
As used in these Notes, the terms "Company," "we," "us," or "our" mean Hyatt Hotels Corporation and its consolidated subsidiaries.
As used in these Notes, the term "Pritzker family business interests" means (1) various lineal descendants of Nicholas J. Pritzker (deceased) and spouses and adopted children of such descendants; (2) various trusts for the benefit of the individuals described in clause (1) and trustees thereof; and (3) various entities owned and/or controlled, directly and/or indirectly, by the individuals and trusts described in (1) and (2).
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation—The consolidated financial statements present the results of operations, financial position, and cash flows of Hyatt Hotels Corporation and its majority owned and controlled subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
Use of Estimates—We are required to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying Notes. Actual results could differ materially from such estimated amounts.
Revenue Recognition—Our revenues are primarily derived from the following sources and are generally recognized when services have been rendered:
Owned and leased hotels revenues are derived from room rentals and services provided at our owned and leased properties and are recorded when rooms are occupied and services have been rendered. Sales and occupancy taxes are recorded on a net basis in the consolidated statements of income.
Management and franchise fees earned from hotels managed and franchised worldwide:
Management fees primarily consist of a base fee, which is generally computed as a percentage of gross revenues, and an incentive fee, which is generally computed based on a hotel profitability measure. Base fee revenues are recognized when earned in accordance with the terms of the contract. We recognize incentive fees that would be due as if the contract were to terminate at that date, exclusive of any termination fees payable or receivable by us.
Realized gains from the sale of hotel real estate assets where we maintain substantial continuing involvement in the form of a long-term management contract are deferred and recognized as management fee revenue over the term of the underlying management contract.
Franchise fees consist of an initial application fee and continuing royalty fees calculated based on a percentage of gross room revenues and in certain circumstances, food and beverage revenues and are recognized as the fees are earned and become due from the franchisee and when all material services or conditions relating to the sale have been substantially performed or satisfied by the franchisor.
Other revenues:
Other revenues include revenues from our co-branded credit card. We recognize revenue from our co-branded credit card upon: (1) the sale of points to our third-party partner and (2) the fulfillment or expiration of a card member's promotional awards. We receive fees from our third-party partner upon activation of each credit card once the card member reaches a specified level of spend, which we defer until the associated promotional nights awarded are redeemed or expired.
Other revenues also include revenues from our vacation ownership business, earned through the date of the sale of the business in the fourth quarter of 2014. Prior to the sale, we recognized vacation ownership revenue when a minimum of 10% of the purchase price for the interval had been received, the period of cancellation with refund had expired, and receivables were deemed collectible. For sales that did not qualify for full revenue recognition, as the project had progressed beyond the preliminary stages, but had not yet reached completion, all revenue and associated direct expenses were initially deferred and recognized in earnings through the percentage-of-completion method. In periods subsequent to the sale of the business, we earn license fees that are recorded to management and franchise fees on our consolidated statements of income.
Other revenues from managed properties represent the reimbursement of costs incurred on behalf of the owners of hotel properties we manage. These costs relate primarily to payroll costs at managed properties where we are the employer, as well as reservations, marketing and technology costs. Since the reimbursements are made based upon the costs incurred with no added margin, these revenues and corresponding expenses have no effect on our net income.
Cash Equivalents—We consider all highly liquid investments purchased with an original maturity of three months or less at the date of purchase to be cash equivalents.
Restricted Cash—We had restricted cash of $76 million and $96 million at December 31, 2016 and December 31, 2015, respectively, which includes:
$40 million and $70 million, respectively, related to sales proceeds from the 2014 dispositions of two Canadian hotels, as the Canadian tax regulations require a portion of the proceeds be classified as restricted until completion of regulatory review (see Note 7);
$14 million and $13 million, respectively, related to debt service on bonds acquired in connection with the acquisition of the entity that owned Grand Hyatt San Antonio (see Note 9); in addition, we have $11 million and $10 million, respectively, recorded in other assets; and
$9 million and $7 million, respectively, related to our captive insurance subsidiary for minimum capital and surplus requirements in accordance with local insurance regulations (see Note 14).
The remaining restricted cash balances of $13 million and $6 million at December 31, 2016 and December 31, 2015, respectively, relate to escrow deposits on construction projects and other arrangements. These amounts are invested in interest-bearing accounts.
Investments—We have investments in unconsolidated hospitality ventures recorded under the equity and cost methods. These investments are an integral part of our business and are strategically and operationally important to our overall results. We assess investments in unconsolidated hospitality ventures for impairment quarterly. When there is indication a loss in value has occurred, we evaluate the carrying value in comparison to the estimated fair value of the investment. Fair value is based upon internally developed discounted cash flow models, third-party appraisals, and if appropriate, current estimated net sales proceeds from pending offers. The principal factors used in the discounted cash flow analysis requiring judgment are the projected future cash flows, the discount rates and the capitalization rate assumptions. Our estimates of projected future cash flows are based on historical data, various internal estimates and a variety of external sources, and are developed as part of our routine, long-term planning process. If the estimated fair value is less than carrying value, we use our judgment to determine if the decline in value is other than temporary. In determining this, we consider factors including, but not limited to, the length of time and extent of the decline, loss of value as a percentage of the cost, financial condition and near-term financial projections, our intent and ability to recover the lost value and current economic conditions. Impairments deemed other than temporary are charged to equity earnings (losses) from unconsolidated hospitality ventures or other income (loss), net on our consolidated statements of income. For additional information about investments, see Note 3.
Marketable Securities—Our investments in marketable securities consist of various types of mutual funds, preferred shares, time deposits, common stock and fixed income securities, including U.S. government obligations, obligations of other government agencies, corporate debt, mortgage-backed and asset-backed securities and municipal and provincial notes and bonds and are classified as either trading, AFS or held-to-maturity ("HTM").
Trading securities—recorded at fair value based on listed market prices or dealer price quotations where available. Realized gains and losses on trading securities are reflected in net gains and interest income from marketable securities held to fund operating programs on our consolidated statements of income.
AFS securities—recorded at fair value as described in Note 4. Unrealized gains and losses on AFS securities are reported as part of accumulated other comprehensive loss on the consolidated balance sheets. Realized gains and losses on AFS securities are recognized in other income (loss), net on our consolidated statements of income.
HTM securities—debt security investments which we have the ability to hold until maturity and are recorded at amortized cost.
AFS and HTM securities are assessed for impairment quarterly. To determine if an impairment is other than temporary, we consider the duration and severity of the loss position, the strength of the underlying collateral, the term to maturity, credit rating and our intent to sell. For debt securities that are deemed other than temporarily impaired and there is no intent to sell, impairments are separated into the amount related to the credit loss, which is typically recorded in other income (loss), net on our consolidated statements of income and the amount related to all other factors, which is recorded in accumulated other comprehensive loss on our consolidated balance sheets. For debt securities that are deemed other than temporarily impaired and there is intent to sell, impairments in their entirety are recorded on our consolidated statements of income. For additional information about marketable securities, see Note 4.
Foreign Currency—The functional currency of our consolidated entities located outside the United States of America is generally the local currency. The assets and liabilities of these entities are translated into U.S. dollars at year-end exchange rates, and the related gains and losses, net of applicable deferred income taxes, are reflected in accumulated other comprehensive loss on the consolidated balance sheets. Gains and losses from foreign currency transactions are included in earnings. Gains and losses from foreign exchange rate changes related to intercompany receivables and payables of a long-term nature are generally included in accumulated other comprehensive loss. Gains and losses from foreign exchange rate movement related to intercompany receivables and payables that are not long-term are included in earnings.
Financing Receivables—Financing arrangements represent contractual rights to receive money either on demand or on fixed or determinable dates and are recognized on our consolidated balance sheets at amortized cost in current and long-term receivables. We recognize interest income as earned and provide an allowance for cancellations and defaults. Our financing receivables are composed of individual unsecured loans and other types of unsecured financing arrangements provided to hotel owners. These financing receivables have stated maturities and interest rates, however, the repayment terms vary and may be dependent upon future cash flows of the hotel.
On an ongoing basis, we monitor the credit quality of our financing receivables based on payment activity. We determine our financing to hotel owners to be non-performing if interest or principal is greater than 90 days past due based on the contractual terms of the individual financing receivables, if an impairment charge is recorded for a loan, or if a provision is established for our other financing arrangements. If we consider a financing receivable to be non-performing, we place the financing receivable on non-accrual status.
We individually assess all loans within financing receivables for impairment quarterly. This assessment is based on an analysis of several factors including current economic conditions and industry trends, as well as the specific risk characteristics of these loans including capital structure, loan performance, market factors, and the underlying hotel performance. When it is probable that we will be unable to collect all amounts due in accordance with the contractual terms of the individual loan agreement or if projected future cash flows available for repayment of unsecured receivables indicate there is a collection risk, we measure the impairment based on the present value of projected future cash flows discounted at the loan’s effective interest rate. For impaired loans, we establish a specific loan loss reserve for the difference between the recorded investment in the loan and the estimated fair value.
In addition to loans, we include other types of financing arrangements in unsecured financing to hotel owners which we do not assess individually for impairment. We regularly evaluate our reserves for these other financing arrangements.
We write off financing to hotel owners when we determine the receivables are uncollectible and when all commercially reasonable means of recovering the receivable balances have been exhausted.
We recognize interest income when received for impaired loans and financing receivables on non-accrual status which is recorded to other income (loss), net in the accompanying consolidated statements of income. Accrual of interest income is resumed when the receivable becomes contractually current and collection doubts are removed. For additional information about financing receivables, see Note 6.
Accounts Receivable—Our accounts receivable primarily consist of trade receivables due from guests for services rendered at our owned and leased properties and from hotel owners with whom we have management and franchise agreements for services rendered and for reimbursements of costs incurred on behalf of managed and franchised properties. We record an accounts receivable reserve when losses are probable, based on an assessment of past collection activity and current business conditions.
Inventories—Inventories are comprised of operating supplies and equipment that have a period of consumption of two years or less, and food and beverage items at our owned and leased hotels which are generally valued at the lower of cost (first-in, first-out) or market. Inventories also include residential inventories, which include two building structures containing luxury villas and the associated land. Inventories are carried at the lower of cost or net realizable value.
Property and Equipment and Definite-Lived Intangibles—Property and equipment and definite-lived intangibles are stated at cost, including interest incurred during development and construction periods, less accumulated depreciation and amortization. Depreciation and amortization are recognized over the estimated useful lives of the assets, primarily on the straight-line method.
Useful lives assigned to property and equipment are as follows:
Buildings and improvements
10-50 years
Leasehold improvements
The shorter of the lease term or useful life of asset
Furniture and equipment
3-20 years
Computers
3-7 years

Useful lives assigned to definite-lived intangibles are as follows:
Management and franchise agreement intangibles
Initial term of management or franchise agreement
Lease related intangibles
Lease term
Advanced booking intangibles
Period of the advanced bookings

We assess property and equipment and definite-lived intangibles for impairment quarterly. When events or circumstances indicate the carrying amount may not be recoverable, we evaluate the net book value of the assets for impairment by comparison to the projected undiscounted future cash flows of the assets. The principal factor used in the undiscounted cash flow analysis requiring judgment is the projected future operating cash flows, which are based on historical data, various internal estimates and a variety of external resources, and are developed as part of our routine, long-term planning process.
If the projected undiscounted future cash flows are less than the net book value of the assets, the fair value is determined based upon internally developed discounted cash flows of the assets, third-party appraisals, and if appropriate, current estimated net sales proceeds from pending offers. The principal factors used in the discounted cash flow analysis requiring judgment are the projected future cash flows, the discount rates and the capitalization rate assumptions. The excess of the net book value over the estimated fair value is charged to asset impairments within our consolidated statements of income.
We evaluate the carrying value of our property and equipment and definite-lived intangibles based on our plans, at the time, for such assets and consider qualitative factors such as future development in the surrounding area, status of local competition and any significant adverse changes in the business climate. Changes to our plans, including a decision to dispose of or change the intended use of an asset, may have a material impact on the carrying value of the asset.
For additional information about property and equipment and definite-lived intangibles, see Notes 5 and 8, respectively.
Acquisitions—Assets acquired and liabilities assumed in business combinations are recorded on our consolidated balance sheets as of the respective acquisition dates based upon their estimated fair values, see Note 7. The results of operations of businesses acquired by us have been included in the consolidated statements of income since their respective dates of acquisition. In certain circumstances, the purchase price allocations are based upon preliminary estimates and assumptions. Accordingly, the allocations are subject to revision when we receive final information, including appraisals and other analyses.
Under the supervision of management, independent third-party valuation specialists estimate the fair value of our properties acquired using various recognized valuation methods including the income approach, the cost approach, and the sales comparison approach, which are primarily based on Level Three assumptions. Assumptions utilized in determining the fair value under these approaches include, but are not limited to, historical financial results when applicable, projected cash flows, discount rates, capitalization rates, current market conditions and comparable transactions. The fair value is then allocated to tangible and intangibles assets with any remaining value assigned to goodwill, if applicable. Various assumptions are used when determining the value to allocate to each identifiable asset, including, discount rates, royalty rates, timing of future cash flows and a variety of external sources. When we acquire the remaining ownership interest in or the property from an unconsolidated hospitality venture in a step acquisition, we estimate the fair value of our equity interest using the assumed cash proceeds we would receive from sale to a third party at a market sales price, which is determined using the aforementioned fair value methodologies and assumptions.
Guarantees—We enter into performance guarantees related to certain hotels we manage. We also enter into debt repayment guarantees with respect to certain hotels we manage or franchise, typically in which we also hold an equity investment. We record a liability for the fair value of these performance and debt repayment guarantees at their inception date. In order to estimate fair value we use a Monte Carlo simulation to model the probability of possible outcomes. The valuation methodology requires that we make certain assumptions and judgments regarding: discount rates, volatility, hotel operating results and hotel property sales prices. The fair value is not re-valued due to future changes in assumptions. The corresponding offset depends on the circumstances in which the guarantee was issued and is recorded to investments, intangibles or expense. We amortize the liability for the fair value of a guarantee into income over the term of the guarantee using a systematic and rational, risk-based approach. Performance guarantees and debt repayment guarantees related to our managed or franchised hotels are amortized into income in other income (loss), net in the consolidated statements of income and debt repayment guarantees that relate to our unconsolidated hospitality ventures are amortized into equity earnings (losses) from unconsolidated hospitality ventures in the consolidated statements of income. On a quarterly basis, we evaluate the likelihood of funding under a guarantee. To the extent we determine an obligation to fund under a guarantee is both probable and estimable based upon performance during the period, we record a separate contingent liability in other income (loss), net or equity earnings (losses) from unconsolidated hospitality ventures. For additional information about guarantees, see Note 14.
Goodwill—Goodwill represents the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. As required, we evaluate goodwill for impairment on an annual basis, and do so during the fourth quarter of each year using balances as of October 1 and at an interim date if indications of impairment exist. Goodwill impairment is determined by comparing the fair value of a reporting unit to its carrying amount. This is done either by performing a qualitative assessment or proceeding to the two-step process, with an impairment being recognized only where the fair value of the reporting unit is less than its carrying value. In any given year we can elect to perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is in excess of its carrying value. If it is not more likely than not that the fair value is in excess of the carrying value, or we elect to bypass the qualitative assessment, we proceed to the two-step process.
When determining fair value, we utilize internally developed discounted future cash flow models, third-party appraisals and, if appropriate, current estimated net sales proceeds from pending offers. Under the discounted cash flow approach we utilize various assumptions requiring judgment, including projected future cash flows, discount rates and capitalization rates. Our estimates of projected future cash flows are based on historical data, various internal estimates and a variety of external sources, and are developed as part of our routine, long-term planning process. We then compare the estimated fair value to our carrying value. If the carrying value is in excess of the fair value, we must determine our implied fair value of goodwill to measure if any impairment charge is necessary. The determination of our implied fair value of goodwill requires the allocation of the reporting unit’s estimated fair value to the individual assets and liabilities of the reporting unit as if we had completed a business combination. We perform the allocation based on our knowledge of the reporting unit, the market in which they operate, and our overall knowledge of the hospitality industry. Changes in our allocation approach could result in different measures of implied fair value and impact the final impairment charge, if any. The excess of the carrying value over the implied fair value is recorded to asset impairments within our consolidated statements of income. For additional information about goodwill, see Note 8.
Income Taxes—We account for income taxes to recognize the amount of taxes payable or refundable for the current year and the amount of deferred tax assets and liabilities resulting from the future tax consequences of differences between the financial statements and tax basis of the respective assets and liabilities. We recognize the financial statement effect of a tax position when, based on the technical merits of the uncertain tax position, it is more likely than not to be sustained on a review by taxing authorities. These estimates are based on judgments made with currently available information. We review these estimates and make changes to recorded amounts of uncertain tax positions as facts and circumstances warrant. For additional information about income taxes, see Note 13.
Fair Value—We apply the provisions of fair value measurement to various financial instruments, which we measure at fair value on a recurring basis, and to various financial and nonfinancial assets and liabilities, which we measure at fair value on a nonrecurring basis. We disclose the fair value of our financial assets and liabilities based on observable market information where available, or on market participant assumptions. These assumptions are subjective in nature, involve matters of judgment, and, therefore, fair values cannot always be determined with precision. When determining fair value, we maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of the hierarchy are as follows:
Level One—Fair values based on unadjusted quoted prices in active markets for identical assets and liabilities;
Level Two—Fair values based on quoted market prices for similar assets and liabilities in active markets, quoted prices in inactive markets for identical assets and liabilities, and inputs other than quoted market prices that are observable for the asset or liability; and
Level Three—Fair values based on inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. Valuation techniques could include the use of discounted cash flow models and similar techniques.
We typically utilize the market approach and income approach for valuing our financial instruments. The market approach utilizes prices and information generated by market transactions involving identical or similar assets and liabilities and the income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted). For instances in which the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of fair value assets and liabilities within the fair value hierarchy.
The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term nature of these items and their close proximity to maturity. The carrying value of restricted cash approximates fair value. The fair value of marketable securities is discussed in Note 4; the fair value of financing receivables is discussed in Note 6; the fair value of our business combinations is discussed in Note 7; the fair value of long-term debt is discussed in Note 9; and the fair value of our guarantee liabilities is discussed in Note 14.
Stock-Based Compensation—As part of our LTIP, we award SARs, RSUs, PSs and PSUs to certain employees and directors:
SARs—Each vested SAR gives the holder the right to the difference between the value of one share of our Class A common stock at the exercise date and the value of one share of our Class A common stock at the grant date. Vested SARs can be exercised over their life as determined in accordance with the LTIP. All SARs have a 10-year contractual term, are settled in shares of our Class A common stock and are accounted for as equity instruments.
We record the compensation expense for SARs on a straight-line basis from the date of grant. The exercise price of these SARs is the fair value of our common stock at the grant date, based on a valuation of the Company prior to the IPO, or the closing share price on the date of grant (as applicable).
RSUs—Each vested RSU will be settled by delivery of a single share of our Class A common stock with the exception of insignificant portions of the March 2016, March 2015, February 2014, March 2013, and June 2013 awards which will be settled in cash. The value of the RSUs is based upon the fair value of our common stock at the grant date, based upon a valuation of the Company prior to IPO, or the closing stock price of our Class A common stock for the December 2009 award and all subsequent awards. Awards issued prior to our November 2009 IPO are deferred in nature and will be settled once all tranches of the award have fully vested or otherwise as provided in the relevant agreements, while all awards issued in December 2009 and later will be settled as each individual tranche vests under the relevant agreements.
We record compensation expense over the requisite service period of the individual grantee. In certain situations we also grant cash-settled RSUs which are recorded as a liability instrument.
PSs—The Company has granted PSs to certain executive officers. The number of PSs that will ultimately vest with no further restrictions on transfer depends upon the performance of the Company at the end of the applicable three year performance period relative to the applicable performance target. The PSs vest in full if the maximum performance metric is achieved, and generally subject to continued employment through the applicable performance period. At the end of the performance period, the PSs that do not vest will be forfeited. The PSs will vest at the end of the performance period only if the performance threshold is met and continued service requirements are satisfied; there is no interim performance metric except in the case of certain change in control transactions.
PSUs—The Company has granted PSUs to certain executive officers. PSUs vest and are settled in Class A common stock based upon the performance of the Company through the end of the applicable three year performance period relative to the applicable performance target, and generally subject to continued employment through the applicable performance period. The PSUs will vest at the end of the performance period only if the performance threshold is met and continued service requirements are satisfied; there is no interim performance metric except in the case of certain change in control transactions.
For additional information about stock-based compensation, see Note 16.
Hyatt Gold Passport—We operate the Program through the Hyatt Gold Passport Fund (the "Fund") for the benefit of the Hyatt portfolio of properties owned, operated, managed, licensed or franchised by us during the period of their participation in the Program. The Fund has been established to provide for the payment of operating expenses and redemption of member awards associated with the Program.
We charge the cost of operating the Program, including the estimated cost of award redemption, to the properties based on members’ qualified expenditures. Due to the requirements under the Program that the properties reimburse us for the Program’s operating costs, we recognize this revenue from properties at the time such costs are incurred and expensed. We defer revenue received from the properties equal to the actuarially determined estimate of our future redemption obligation. Upon the redemption of points, we recognize the previously deferred revenue and recognize the corresponding expense relating to the cost of the awards redeemed. Revenue is recognized by the properties when the points are redeemed, and expenses are recognized when the points are earned by the members.
We actuarially determine the estimate of the future redemption obligation based on statistical formulas that project the timing of future point redemption based on historical experience, including an estimate of the breakage for points that will never be redeemed, and an estimate of the points that will eventually be redeemed. Actual expenditures for the Program may differ from the actuarially determined liability.
The Fund is financed by payments from the properties and returns on marketable securities. The Fund invests amounts received from the properties in marketable securities which are included in other current and noncurrent assets (see Note 4). The noncurrent liabilities of the Fund are included in other long-term liabilities (see Note 12). Assets and liabilities of the Fund are as follows:
 
December 31, 2016
 
December 31, 2015
Current Assets
$
150

 
$
179

Noncurrent Assets
296

 
280

Total Assets
$
446

 
$
459

 
 
 
 
Current Liabilities
$
150

 
$
179

Noncurrent Liabilities
296

 
280

Total Liabilities
$
446

 
$
459


The current liabilities include $139 million and $166 million recorded in accrued expenses and other current liabilities on the consolidated balance sheets at December 31, 2016 and December 31, 2015, respectively.
Recently Issued Accounting Pronouncements
Adopted Accounting Standards
In April 2015, the Financial Accounting Standards Board ("FASB") released ASU 2015-03, which requires debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. The provisions of ASU 2015-03 are effective for interim periods and fiscal years beginning after December 15, 2015. We adopted the standard on January 1, 2016, and as a result we reclassified $5 million of debt issuance costs previously included in other assets to long-term debt on our consolidated balance sheets as of December 31, 2015.
Future Adoption of Accounting Standards
In May 2014, the FASB released ASU 2014-09, which supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and provides a single, comprehensive revenue recognition model for contracts with customers. In August 2015, the FASB released Accounting Standards Update No. 2015-14 ("ASU 2015-14"), Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. ASU 2015-14 delays the effective date of ASU 2014-09 by one year, making it effective for interim periods and fiscal years beginning after December 15, 2017, with early adoption permitted as of the original effective date under ASU 2014-09.
The standard permits the use of either the retrospective or modified retrospective (cumulative effect) transition method and we have not yet selected which transition method we will apply. While we continue to evaluate possible impacts on our consolidated financial statements, ASU 2014-09 is expected to impact either the amount or timing of revenue recognition as follows:
Under existing guidance, gains on sales of real estate when we maintain substantial continuing involvement are deferred and amortized into management and franchise fee revenues. Upon adoption of ASU 2014-09, gains on sales of real estate assets will be recognized when control of the property transfers to the buyer. We expect any remaining unamortized deferred gains as of our date of adoption will be included as an adjustment to equity. For the year ended December 31, 2016, Hyatt recognized $21 million of management fee revenue related to the amortization of deferred gains.
Under existing guidance, amortization of management and franchise agreement intangibles is recorded within depreciation and amortization on our consolidated statements of income. Upon adoption of ASU 2014-09, management and franchise agreement intangibles may meet the definition of consideration paid to a customer and therefore, could be recorded as contra-revenue within management and franchise fees on our consolidated statements of income.
Under existing guidance, incentive fees are recognized in the amount that would be due as if the contract were to terminate at that date. Under ASU 2014-09, variable consideration is included in the transaction price only if it is probable that a significant reversal in the cumulative amount of revenue recognized would not occur when the uncertainty associated with the variable consideration is subsequently resolved. This may result in a different pattern of recognition for incentive fees for certain contracts.
Under existing guidance, franchise application fees are recognized at a point in time. Upon adoption of ASU 2014-09, initial franchise application fees will be recognized over time.
We do not expect the standard to materially affect the amount or timing of revenue recognition for royalty fees from our franchised properties or base management fees from our managed properties. We are continuing to evaluate other possible impacts to our consolidated financial statements, including the impact related to Hyatt Gold Passport.
In January 2016, the FASB released Accounting Standards Update No. 2016-01 ("ASU 2016-01"), Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 revises the accounting for equity investments and financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. The provisions of ASU 2016-01 are effective for interim periods and fiscal years beginning after December 15, 2017. We are currently evaluating the impact of adopting ASU 2016-01.
In February 2016, the FASB released Accounting Standards Update No. 2016-02 ("ASU 2016-02"), Leases (Topic 842). ASU 2016-02 requires lessees to record lease contracts on the balance sheet by recognizing a right-of-use asset and lease liability. The provisions of ASU 2016-02 are effective for interim periods and fiscal years beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact of adopting ASU 2016-02.
In June 2016, the FASB released Accounting Standards Update No. 2016-13 ("ASU 2016-13"), Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaces the existing impairment model for most financial assets from an incurred loss impairment model to a current expected credit loss model, which requires an entity to recognize an impairment allowance equal to its current estimate of all contractual cash flows the entity does not expect to collect. ASU 2016-13 also requires credit losses relating to AFS debt securities to be recorded through an allowance for credit losses. The provisions of ASU 2016-13 are effective for interim periods and fiscal years beginning after December 15, 2019, with early adoption permitted. We are currently evaluating the impact of adopting ASU 2016-13.
In October 2016, the FASB released Accounting Standards Update No. 2016-16 ("ASU 2016-16"), Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. ASU 2016-16 requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The provisions of ASU 2016-16 are effective for interim periods and fiscal years beginning after December 15, 2017, with early adoption permitted. We are currently evaluating the impact of adopting ASU 2016-16.
Equity and Cost Method Investments
Equity and Cost Method Investments
EQUITY AND COST METHOD INVESTMENTS
 
December 31, 2016
 
December 31, 2015
Equity method investments
$
180

 
$
304

Cost method investments
6

 
23

Total investments
$
186

 
$
327


Of our total investment balance at December 31, 2016 and December 31, 2015, $186 million and $311 million, respectively, was recorded in our owned and leased hotels segment.
The carrying values and ownership percentages of our unconsolidated investments in hospitality ventures accounted for under the equity method were as follows:
 
Ownership Interests
 
Investment Balance
December 31, 2016
 
December 31, 2015
Juniper Hotels Private Limited
50.0
%
 
$
37

 
$
44

Playa Hotels & Resorts B.V.
23.7
%
 
23

 
28

San Jose Hotel Partners, L.L.C.
40.0
%
 
15

 
12

Four One Five, L.L.C.
49.0
%
 
15

 
5

Rio Preto Partners SARL
70.0
%
 
14

 
7

Desarrolladora Hotel Acueducto S. de R.L. de C.V.
50.0
%
 
13

 
15

Hotel Hoyo Uno, S. de R.L. de C.V.
40.0
%
 
13

 
14

Hotel Am Belvedere GmbH & Co KG
50.0
%
 
12

 

Wailea Hotel Holdings, L.L.C. (See Note 7)
%
 

 
125

Other
 
 
38

 
54

Total
 
 
$
180

 
$
304


The following tables present summarized financial information for all unconsolidated hospitality ventures in which we hold an investment accounted for under the equity method.
 
Years Ended December 31,
2016
 
2015
 
2014
Total revenues
$
1,229

 
$
1,079

 
$
1,192

Gross operating profit
398

 
312

 
329

Income from continuing operations
160

 
33

 
31

Net income
160

 
33

 
31

 
 
December 31, 2016
 
December 31, 2015
Current Assets
$
443

 
$
472

Noncurrent Assets
2,701

 
2,877

Total Assets
$
3,144

 
$
3,349

 
 
 
 
Current Liabilities
$
385

 
$
625

Noncurrent Liabilities
2,037

 
1,752

Total Liabilities
$
2,422

 
$
2,377


During 2016, we had the following activity:
We purchased our partners' interests in Andaz Maui at Wailea Resort and villas. The transaction was accounted for as a step acquisition and we recorded a gain of $14 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income in our owned and leased hotels segment. See Note 7 for further discussion of our acquisition.
We sold our ownership interest in an equity method investment within our owned and leased hotels segment for which we received proceeds of $4 million. We recorded a gain of $3 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
Two unconsolidated hospitality ventures in which we hold or held an ownership interest and which are classified as equity method investments within our owned and leased hotels segment, sold five Hyatt Place hotels, for which we received combined proceeds of $15 million. We recorded gains of $7 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
During 2015, we had the following activity:
Unconsolidated hospitality ventures in which we hold or held an ownership interest, which are classified as equity method investments within our owned and leased hotels segment sold two Hyatt Place hotels for which we received proceeds of $16 million. We recorded gains of $13 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
We sold an entity which held an interest in one of our foreign currency denominated equity method investments within our owned and leased hotels segment, for which we received proceeds of $3 million. In connection with the sale, we released $21 million of accumulated foreign currency translation losses, which was recorded to equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
During 2014, we had the following activity:
We purchased Hyatt Regency Lost Pines Resort and Spa and adjacent land from an unconsolidated hospitality venture in which we held an 8.2% interest, for a net purchase price of approximately $164 million. This transaction was accounted for as a step acquisition and we recorded a gain of $12 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income in our owned and leased hotels segment. See Note 7 for further discussion of our acquisition.
Unconsolidated hospitality ventures in which we held an ownership interest and which were classified as equity method investments within our owned and leased hotels segment, sold the following hotels to third parties, resulting in deferred gains that are being amortized over the term of the management agreements in management and franchise fees within the Americas management and franchising segment:
A Hyatt Place hotel, for which we received proceeds of $12 million and recorded a deferred gain of $10 million; and
Hyatt Regency DFW International Airport and another building, for which we received proceeds of $19 million and recorded a deferred gain of $18 million.
Unconsolidated hospitality ventures in which we held an ownership interest and which were classified as equity method investments within our owned and leased hotels segment, sold two Hyatt Place hotels, for which we received proceeds of $33 million. We recorded gains of $22 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
During 2016, 2015 and 2014 we recorded $9 million, $0 and $3 million, respectively, in impairment charges in equity earnings (losses) from unconsolidated hospitality ventures. The impairment charges in 2016 relate to four unconsolidated hospitality ventures which are accounted for as equity method investments.
Marketable Securities
Marketable Securities
MARKETABLE SECURITIES
We hold marketable securities to fund certain operating programs and for investment purposes. We periodically transfer cash and cash equivalents to time deposits, highly liquid and transparent commercial paper, corporate notes and bonds, and U.S. government obligations and obligations of other government agencies for investment purposes.
Marketable Securities Held to Fund Operating Programs—Marketable securities held to fund operating programs, which are recorded at fair value and included on the consolidated balance sheets, were as follows: 
 
December 31, 2016
 
December 31, 2015
Marketable securities held by Hyatt Gold Passport Fund (Note 2)
$
394

 
$
384

Marketable securities held to fund deferred compensation plans held in rabbi trusts (Note 11)
352

 
333

Marketable securities held to fund our captive insurance companies
65

 
82

Total marketable securities held to fund operating programs
$
811

 
$
799

Less current portion of marketable securities held to fund operating programs included in cash and cash equivalents, short-term investments, and prepaids and other assets
(109
)
 
(121
)
Marketable securities held to fund operating programs included in other assets
$
702

 
$
678


Net gains and interest income from marketable securities held to fund operating programs on the consolidated statements of income included realized and unrealized gains and losses and interest income related to the following:
 
Years Ended December 31,
2016
 
2015
 
2014
Hyatt Gold Passport Fund
$
2

 
$
1

 
$
3

Deferred compensation plans held in rabbi trusts
17

 
3

 
12

Total net gains and interest income from marketable securities held to fund operating programs
$
19

 
$
4

 
$
15


Our captive insurance companies hold marketable securities which are classified as AFS and are invested in U.S. government agencies, time deposits and corporate debt securities. We classify these investments as current or long-term, based on their contractual maturity dates, which range from 2017 through 2021.
Marketable Securities Held for Investment Purposes—Marketable securities held for investment purposes, which are recorded at fair value and included on the consolidated balance sheets, were as follows: 
 
December 31, 2016
 
December 31, 2015
Interest bearing money market funds
$
106

 
$
5

Time deposits
45

 
30

Preferred shares
290

 
335

Total marketable securities held for investment purposes
$
441

 
$
370

Less current portion of marketable securities held for investment purposes included in cash and cash equivalents and short-term investments
(151
)
 
(35
)
Marketable securities held for investment purposes included in other assets
$
290

 
$
335



Fair Value—We measured the following financial assets at fair value on a recurring basis:
 
December 31, 2016
 
Cash and Cash Equivalents
 
Short-term Investments
 
Prepaids and Other Assets
 
Other Assets
Level One - Quoted Prices in Active Markets for Identical Assets
 
 
 
 
 
 
 
 
 
Interest bearing money market funds
$
114

 
$
114

 
$

 
$

 
$

Mutual funds
352

 

 

 

 
352

Level Two - Significant Other Observable Inputs
 
 
 
 
 
 
 
 
 
Time deposits
59

 

 
46

 

 
13

U.S. government obligations
142

 

 

 
33

 
109

U.S. government agencies
53

 

 
9

 
8

 
36

Corporate debt securities
181

 

 
1

 
35

 
145

Mortgage-backed securities
22

 

 

 
5

 
17

Asset-backed securities
34

 

 

 
8

 
26

Municipal and provincial notes and bonds
5

 

 

 
1

 
4

Level Three - Significant Unobservable Inputs
 
 
 
 
 
 
 
 
 
Preferred Shares
290

 

 

 

 
290

Total
$
1,252

 
$
114

 
$
56

 
$
90

 
$
992


 
December 31, 2015
 
Cash and Cash Equivalents
 
Short-term Investments
 
Prepaids and Other Assets
 
Other Assets
Level One - Quoted Prices in Active Markets for Identical Assets
 
 
 
 
 
 
 
 
 
Interest bearing money market funds
$
18

 
$
18

 
$

 
$

 
$

Mutual funds
333

 

 

 

 
333

Level Two - Significant Other Observable Inputs
 
 
 
 
 
 
 
 
 
Time deposits
45

 

 
38

 

 
7

U.S. government obligations
131

 

 

 
32

 
99

U.S. government agencies
83

 

 
6

 
10

 
67

Corporate debt securities
168

 

 
2

 
36

 
130

Mortgage-backed securities
26

 

 

 
6

 
20

Asset-backed securities
27

 

 

 
7

 
20

Municipal and provincial notes and bonds
3

 

 

 
1

 
2

Level Three - Significant Unobservable Inputs
 
 
 
 
 
 
 
 
 
Preferred shares
335

 

 

 

 
335

Total
$
1,169

 
$
18

 
$
46

 
$
92

 
$
1,013


During the years ended December 31, 2016 and December 31, 2015, there were no transfers between levels of the fair value hierarchy. Our policy is to recognize transfers in and transfers out as of the end of each quarterly reporting period. We currently do not have non-financial assets or non-financial liabilities required to be measured at fair value on a recurring basis.
We invest a portion of our cash into short-term interest bearing money market funds that have a maturity of less than 90 days. Consequently, the balances are recorded in cash and cash equivalents. The funds are held with open-ended registered investment companies, and the fair value of the funds is classified as Level One as we are able to obtain market available pricing information on an ongoing basis. The fair value of our mutual funds is classified as Level One as they trade with sufficient frequency and volume to enable us to obtain pricing information on an ongoing basis. Time deposits are recorded at par value, which approximates fair value and are classified as Level Two. The remaining securities, other than our investment in preferred shares, are classified as Level Two due to the use and weighting of multiple market inputs being considered in the final price of the security. Market inputs include quoted market prices from active markets for identical securities, quoted market prices for identical securities in inactive markets, and quoted market prices in active and inactive markets for similar securities.
Preferred shares—During the year ended December 31, 2013, we invested $271 million in Playa for redeemable, convertible preferred shares. We have the option to convert our preferred shares and any accrued and unpaid paid in kind ("PIK") dividends thereon into shares of common stock at any time through the later of the second anniversary of the closing of our investment or upon an initial public offering by Playa. The preferred investment is redeemable at our option in August 2021. In the event of a potential future Playa IPO or other equity issuance by Playa, we have the option to request that Playa redeem up to $125 million of preferred shares at par plus any accrued and unpaid PIK dividends thereon. As a result, we have classified the preferred investment as an AFS debt security, which is re-measured quarterly at fair value through other comprehensive loss on the consolidated balance sheets. The fair value of the preferred shares was: 
 
2016
 
2015
Fair value at January 1
$
335

 
$
280

Gross unrealized gains
19

 
55

Gross unrealized losses
(29
)
 

Realized losses
(6
)
 

Interest income
12

 

Cash redemption
(41
)
 

Fair value at December 31
$
290

 
$
335


In October 2016, Playa redeemed 3,458,530 of our preferred shares plus accrued and unpaid PIK dividends thereon for $41 million. In conjunction with the redemption, we recorded $12 million of interest income and $6 million of realized losses in other income (loss), net on our consolidated statements of income. The realized losses were the result of a difference between the fair value of the initial investment and the contractual redemption price of $8.40 per share.
On December 13, 2016, Playa announced that it entered into a definitive business combination agreement with Pace, a special-purpose acquisition company. Prior to announcing the Pace business combination, Playa publicly filed a Registration Statement on Form S-1 with the SEC in conjunction with its proposed IPO of common shares. In connection with the Pace business combination or potential future Playa IPO, we expect a portion of the cash proceeds would be used for a partial or full redemption of Playa's preferred shares. There is no assurance Playa will complete the Pace business combination or a potential future IPO.
Due to the lack of availability of market data, the preferred shares are classified as Level Three. At December 31, 2015, we estimated the fair value of the Playa preferred shares using an option-pricing model. As a result of Playa's potential Pace business combination or potential future Playa IPO, we revised our valuation approach to utilize a hybrid of the option-pricing model and the probability-weighted expected return method, to estimate the fair value of Playa's preferred shares. The hybrid model includes various scenarios, such as the successful completion of the Pace business combination, potential future Playa IPO with assumptions around conversion and redemption, as well as a scenario using the option-pricing model. We assigned a probability to each scenario to arrive at the estimated fair value at December 31, 2016. Our scenarios include assumptions regarding (i) the successful completion of the Pace business combination, (ii) a potential range of IPO prices and size of the offering, and (iii) conversion of up to $50 million of our preferred shares into common shares of Playa. The option-pricing model scenario includes assumptions regarding the expected term, risk-free interest rate over the expected term, volatility, dividend yield and enterprise value. Financial forecasts were used in the computation of the enterprise value using the income approach, based on assumed revenue growth rates and operating margin levels. The risks associated with achieving these forecasts were assessed in selecting the appropriate weighted-average cost of capital.
The option-pricing scenarios include variations of the expected term, risk-free interest rate, volatility, and dividend yield assumptions as follows:
 
December 31, 2016
 
December 31, 2015
Expected term
1 year

 
0.75 years

Risk-free Interest Rate
0.85
%
 
0.57
%
Volatility
46.5
%
 
46.0
%
Dividend Yield
12.0
%
 
12.0
%

There is inherent uncertainty in our assumptions and fluctuations in these assumptions or the probabilities assigned to each scenario may result in different estimates of fair value. At December 31, 2016, the assumption which most significantly impacted the fair value of the preferred shares is the assignment of probabilities to each potential scenario. A change to the assigned probabilities may cause the fair value to decrease up to $4 million and increase up to $64 million, representing the difference between the low and high end of the range of fair values based on each scenario.
HTM Debt Securities—At December 31, 2016 and December 31, 2015, we had investments in HTM debt securities of $27 million and $25 million, respectively, which are investments in third-party entities that own certain of our hotels. The amortized cost of our investments approximates fair value. The securities are mandatorily redeemable between 2020 and 2025.
Property and Equipment, Net
Property and Equipment, Net
PROPERTY AND EQUIPMENT, NET
 
December 31, 2016
 
December 31, 2015
Land
$
901

 
$
674

Buildings
4,125

 
3,898

Leasehold improvements
202

 
220

Furniture, equipment and computers
1,316

 
1,209

Construction in progress
90

 
251

 
6,634

 
6,252

Accumulated depreciation
(2,364
)
 
(2,221
)
Total property and equipment, net
$
4,270

 
$
4,031


Depreciation expense was as follows:
 
Years Ended December 31,
2016
 
2015
 
2014
Depreciation expense
$
315

 
$
289

 
$
324


The net book value of capital leased assets at December 31, 2016 and December 31, 2015 was $12 million and $13 million, respectively, which is net of accumulated depreciation of $10 million and $8 million, respectively.
Interest capitalized as a cost of property and equipment was $3 million, $6 million and $7 million for the years ended December 31, 2016, December 31, 2015 and December 31, 2014, respectively, and was recorded net in interest expense. The years ended December 31, 2016, December 31, 2015 and December 31, 2014 included $0, $5 million and $13 million respectively, of asset impairments on the consolidated statements of income in our owned and leased hotels segment.
Financing Receivables
Financing Receivables
FINANCING RECEIVABLES
 
December 31, 2016
 
December 31, 2015
Unsecured financing to hotel owners
119

 
120

Less allowance for losses
(100
)
 
(98
)
Less current portion included in receivables, net

 
(2
)
Total long-term financing receivables, net
$
19

 
$
20


During the year ended December 31, 2015, all of our outstanding secured financing receivables to hotel owners were settled. We received net cash proceeds of $26 million, an unsecured financing receivable of $6 million, and preferred equity investments of $7 million. The preferred equity investments include a $6 million HTM debt security, which is recorded in Americas management and franchising segment, and a $1 million cost method investment. The settlements of the secured financing receivables resulted in a net recovery of $8 million, which was recognized in other income (loss), net on our consolidated statements of income during the year ended December 31, 2015.
Allowance for Losses and ImpairmentsThe following tables summarize the activity in our financing receivables allowance:
 
Secured Financing
 
Unsecured Financing
 
Total
Allowance at January 1, 2016
$

 
$
98

 
$
98

   Provisions

 
10

 
10

   Write-offs

 
(8
)
 
(8
)
Allowance at December 31, 2016
$

 
$
100

 
$
100

 
Secured Financing
 
Unsecured Financing
 
Total
Allowance at January 1, 2015
$
13

 
$
87

 
$
100

   Provisions
3

 
7

 
10

   Write-offs
(1
)
 

 
(1
)
   Recoveries
(9
)
 

 
(9
)
   Other adjustments
(6
)
 
4

 
(2
)
Allowance at December 31, 2015
$

 
$
98

 
$
98


During the year ended December 31, 2014, we recorded insignificant provisions for secured financing to hotel owners and provisions of $6 million for unsecured financing to hotel owners.
Credit MonitoringOur unsecured financing receivables were as follows:
 
December 31, 2016
 
Gross Loan Balance (Principal and Interest)
 
Related Allowance
 
Net Financing Receivables
 
Gross Receivables on Non-Accrual Status
Loans
$
13

 
$

 
$
13

 
$

Impaired loans (1)
56

 
(56
)
 

 
56

Total loans
69

 
(56
)
 
13

 
56

Other financing arrangements
50

 
(44
)
 
6

 
44

Total unsecured financing receivables
$
119

 
$
(100
)
 
$
19

 
$
100

(1) The unpaid principal balance was $43 million and the average recorded loan balance was $57 million at December 31, 2016.
 
December 31, 2015
 
Gross Loan Balance (Principal and Interest)
 
Related Allowance
 
Net Financing Receivables
 
Gross Receivables on Non-Accrual Status
Loans
$
15

 
$

 
$
15

 
$

Impaired loans (2)
58

 
(58
)
 

 
58

Total loans
73

 
(58
)
 
15

 
58

Other financing arrangements
47

 
(40
)
 
7

 
40

Total unsecured financing receivables
$
120

 
$
(98
)
 
$
22

 
$
98

(2) The unpaid principal balance was $42 million and the average recorded loan balance was $55 million at December 31, 2015.

Fair ValueWe estimated the fair value of financing receivables which are classified as Level Three in the fair value hierarchy to be approximately $19 million and $22 million at December 31, 2016 and December 31, 2015, respectively.
Acquisitions and Dispositions
Acquisitions and Dispositions
    ACQUISITIONS AND DISPOSITIONS
Acquisitions
Andaz Maui at Wailea Resort—We previously held a 65.7% interest and had a $180 million investment in the entities that own Andaz Maui at Wailea Resort and villas prior to acquisition. Accordingly, we accounted for the investment as an unconsolidated hospitality venture under the equity method. During the year ended December 31, 2016, we purchased the remaining 34.3% for a net purchase price of approximately $136 million, net of $12 million of cash acquired. This transaction was accounted for as a step acquisition and we recorded a gain of $14 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income. The purchase of the remaining 34.3% interest was structured and identified as replacement property in a potential reverse like-kind exchange. In conjunction with the acquisition, the outstanding debt at the unconsolidated hospitality venture was repaid in full and we were released from our debt repayment guarantee obligation, see Note 14.
The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed, which are recorded in our owned and leased hotels segment at the date of acquisition:
Cash and cash equivalents
$
12

Receivables
3

Inventories
13

Prepaids and other assets
1

Property and equipment
323

Total assets
$
352

 
 
Current liabilities
10

Total liabilities
$
10

Total net assets acquired
$
342


Land Held for Development—During the year ended December 31, 2016, we acquired land of $25 million from an unrelated third party with the intent to develop a hotel in Philadelphia.
Royal Palms Resort and Spa—During the year ended December 31, 2016, we acquired Royal Palms Resort and Spa in Phoenix, Arizona, from an unrelated third party for a net purchase price of approximately $86 million, net of $2 million of proration adjustments. Due to the iconic nature of the hotel, we retained the Royal Palms Resort and Spa name and added the hotel to The Unbound Collection by Hyatt. Of the $88 million purchase price, assets acquired and recorded in our owned and leased hotels segment consist of $75 million of property and equipment, $9 million of indefinite-lived brand intangibles, and $1 million of advanced bookings intangibles. We also recorded $3 million of management agreement intangibles in our Americas management and franchising segment, which are being amortized over a useful life of 20 years. The purchase of Royal Palms Resort and Spa was structured and identified as replacement property in a potential reverse like-kind exchange agreement.
The Confidante Miami Beach—During the year ended December 31, 2016, we acquired Thompson Miami Beach for a purchase price of approximately $238 million, from a seller indirectly owned by a limited partnership affiliated with the brother of our Executive Chairman. Of the $238 million purchase price, assets acquired consist of $228 million of property and equipment, which was recorded in our owned and leased hotels segment, and $10 million of management agreement intangibles, which were recorded in our Americas management and franchising segment and are being amortized over a useful life of 20 years. We rebranded this hotel as The Confidante Miami Beach and added the hotel to The Unbound Collection by Hyatt. The purchase of The Confidante Miami Beach was structured and identified as replacement property in a potential reverse like-kind exchange agreement, but the allowable period to complete the exchange expired during the fourth quarter of 2016.
Hyatt Regency Lost Pines Resort and Spa—We previously held an 8.2% interest in the entity which owned Hyatt Regency Lost Pines Resort and Spa and adjacent land. Accordingly, we accounted for the investment as an unconsolidated hospitality venture under the equity method. During the year ended December 31, 2014, we purchased the hotel and adjacent land from the unconsolidated hospitality venture for a net purchase price of approximately $164 million. As part of the acquisition, we assumed debt of $69 million, which included a $3 million debt premium (see Note 9). This transaction was accounted for as a step acquisition and we recorded a gain of $12 million in equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed, which are recorded in our owned and leased hotels segment at the date of acquisition:
Cash and cash equivalents
$
7

Receivables
4

Inventories
1

Property and equipment
207

Goodwill
17

Intangibles
4

Deferred tax assets
1

Total assets
$
241

 
 
Current portion of long-term debt
$
4

Current liabilities
8

Long-term debt
65

Total liabilities
77

Total net assets acquired
$
164


The purchase price allocation for this acquisition created goodwill of $17 million at the date of acquisition, of which $15 million is deductible for tax purposes. The goodwill is attributable to securing Hyatt's long-term presence in this strategic property. The definite-lived intangibles relate to $4 million of advanced bookings, which were amortized over a useful life of 14 months. See "Like-Kind Exchange Agreements" below, as the purchase of Hyatt Regency Lost Pines Resort and Spa was designated as replacement property in a like-kind exchange.
Park Hyatt New York—During the year ended December 31, 2014, we acquired Park Hyatt New York for a purchase price of approximately $392 million, including $1 million of cash. Of the $391 million net purchase price, assets acquired include $386 million of property and equipment, $3 million of inventories, and $2 million of prepaids and other assets, which were recorded in our owned and leased hotels segment. See "Like-Kind Exchange Agreements" below, as the purchase of Park Hyatt New York was designated as replacement property in a like-kind exchange.
Non-recurring Fair Value Measurement—Significant unobservable Level Three inputs used to fair value the 2016 acquisitions include:
 
2016
Discount rate
7.25% - 9.00%
Terminal capitalization rate (1)
5.50% - 7.75%
(1) Reflects the risk profile of the individual markets where the assets are located and are not necessarily indicative of our hotel portfolio as a whole.
Dispositions
Hyatt Regency Birmingham (U.K.)—During the year ended December 31, 2016, we sold the shares of the company that owns Hyatt Regency Birmingham (U.K.) to an unrelated third party for approximately $49 million, net of closing costs and proration adjustments and entered into a long-term management agreement with the owner of the property. The sale resulted in a $17 million pre-tax gain which was deferred and is being recognized in management and franchise fees over the term of the management agreement, within our EAME/SW Asia management and franchising segment. The operating results and financial position of this hotel prior to the sale remain within our owned and leased hotels segment.
Andaz 5th Avenue—During the year ended December 31, 2016, we sold Andaz 5th Avenue to an unrelated third party for $240 million, net of $10 million of closing costs and proration adjustments and entered into a long-term management agreement with the owner of the property. The sale resulted in a $23 million pre-tax loss which was recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2016. The operating results and financial position of this hotel prior to the sale remain within our owned and leased hotels segment.
Hyatt Regency Indianapolis—During the year ended December 31, 2015, we sold Hyatt Regency Indianapolis for $69 million, net of closing costs, to an unrelated third party, and entered into a long-term franchise agreement with the owner of the property. The sale resulted in a pre-tax gain of $8 million, which was recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2015. The operating results and financial position of this hotel prior to the sale remain within our owned and leased hotels segment.
Land Held for Development—During the year ended December 31, 2015, we sold land and construction in progress for $14 million to an unconsolidated hospitality venture in which Hyatt has a 40% ownership interest.
A Hyatt House Hotel—During the year ended December 31, 2015, we sold a select service property for $5 million, net of closing costs, to an unrelated third party resulting in a $1 million pre-tax gain which was recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2015. The operating results and financial position of this hotel prior to the sale remain within our owned and leased hotels segment.
Hyatt Place 2014—During the year ended December 31, 2014, we sold five Hyatt Place properties located in Texas and North and South Carolina for a total of $51 million, net of closing costs, to unrelated third parties. These transactions resulted in pre-tax gains of approximately $13 million. The Company entered into long-term franchise agreements with the purchasers of the hotels. The gains were recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2014. The operating results and financial position of these hotels prior to the sale remain within our owned and leased hotels segment. See "Like-Kind Exchange Agreements" below, as proceeds from the sale were held as restricted for use in a potential like-kind exchange.
Park Hyatt Toronto—During the year ended December 31, 2014, we sold Park Hyatt Toronto for $88 million, net of closing costs, to an unrelated third party, resulting in a pre-tax gain of $49 million. The Company entered into a long-term management agreement with the purchaser of the hotel. The gain on sale was deferred and is being recognized in management and franchise fees over the term of the management contract, within our Americas management and franchising segment. The operating results and financial position of this hotel prior to the sale remain within our owned and leased hotels segment.
Hyatt Regency Vancouver—During the year ended December 31, 2014, we sold Hyatt Regency Vancouver for $116 million, net of closing costs, to an unrelated third party, resulting in a pre-tax gain of $64 million. The Company entered into a long-term management agreement with the purchaser of the hotel. The gain on sale was deferred and is being recognized in management and franchise fees over the term of the management contract, within our Americas management and franchising segment. The operating results and financial position of this hotel prior to the sale remain within our owned and leased hotels segment.
Hyatt Place, Hyatt House 2014—During the year ended December 31, 2014, we sold 38 select service properties for a total of $581 million, net of closing costs, to an unrelated third party. This transaction resulted in a pre-tax gain of approximately $153 million. The Company entered into long-term franchise agreements with the purchaser of the hotels. The gain was recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2014. The operating results and financial position of these hotels prior to the sale remain within our owned and leased hotels segment. See "Like-Kind Exchange Agreements" below, as the proceeds from the sale of 21 of the hotels have been used in a like-kind exchange and proceeds from the sale of six of the hotels were held as restricted for use in a potential like-kind exchange.
Park Hyatt Washington—During the year ended December 31, 2014, we sold Park Hyatt Washington for $97 million, net of closing costs, to an unrelated third party, resulting in a pre-tax gain of $57 million. The Company entered into a long-term management agreement with the purchaser of the hotel. The gain on sale was deferred and is being recognized in management and franchise fees over the term of the management contract, within our Americas management and franchising segment. The operating results and financial position of this hotel prior to the sale remain within our owned and leased hotels segment. See "Like-Kind Exchange Agreements" below, as proceeds from the sale have been used in a like-kind exchange.
Hyatt Residential Group—During the year ended December 31, 2014, we sold our vacation ownership business, which included an interest in a joint venture that owns a vacation ownership property in Maui, Hawaii, as well as a full service hotel, to an unrelated third party for approximately $220 million, net of working capital adjustments, resulting in a pre-tax gain of $80 million. The gain was recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2014. We entered into a master license agreement with the purchaser and receive recurring annual license fees under this agreement, which are recorded in management and franchise fees within our corporate and other segment on our consolidated statements of income. The operating results and financial position of Hyatt Residential Group prior to the sale remain primarily within our corporate and other segment.
Hyatt, Hyatt Place, Hyatt House 2014—During the year ended December 31, 2014, we sold nine select service properties and one full service property for a total of $311 million, net of closing costs, to an unrelated third party. In connection with the sale, we transferred net cash and cash equivalents of $1 million, resulting in a net sales price of $310 million. We recorded a pre-tax gain of approximately $65 million for the year ended December 31, 2014. The properties will remain Hyatt-branded hotels for a minimum of 25 years under long-term agreements. The gain was recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2014. The operating results and financial position of these hotels prior to the sales remain within our owned and leased hotels segment. See "Like-Kind Exchange Agreements" below, as proceeds from the sales have been used in a like-kind exchange.
As a result of certain dispositions, we have agreed to provide customary indemnifications to third-party purchasers for certain liabilities incurred prior to sale and for breach of certain representations and warranties made during the sales process, such as representations of valid title, authority, and environmental issues that may not be limited by a contractual monetary amount. These indemnification agreements survive until the applicable statutes of limitation expire or until the agreed upon contract terms expire.
Like-Kind Exchange Agreements
Periodically, we enter into like-kind exchange agreements upon the disposition or acquisition of certain hotels. Pursuant to the terms of these agreements, the proceeds from the sales are placed into an escrow account administered by a qualified intermediary. The proceeds are recorded to restricted cash on our consolidated balance sheets and released once they are utilized as part of a like-kind exchange agreement or when a like-kind exchange agreement is not completed within the allowable time period.
In conjunction with the sale of five Hyatt Place properties during the year ended December 31, 2014, we entered into like-kind exchange agreements with a qualified intermediary. Pursuant to the like-kind exchange agreements, the combined net proceeds of $51 million from the sales of these hotels were placed into an escrow account administered by a qualified intermediary. During the year ended December 31, 2015, we released the net proceeds because the identified replacement property was not acquired in order to complete the exchange.
In conjunction with the sale of 38 select service properties during the year ended December 31, 2014, we entered into like-kind exchange agreements with a qualified intermediary for 27 of the select service hotels. In the fourth quarter of 2014, we classified net proceeds of $403 million from the sale of these 27 properties as restricted cash. Of this total, we released net proceeds of $311 million related to 21 of the select service hotels from restricted cash as they were utilized as part of the like-kind exchange agreement to acquire Park Hyatt New York. During the year ended December 31, 2015, we released $92 million of net proceeds related to the remaining six hotels from restricted cash, as the intermediary distributed these funds from escrow to complete the reverse like-kind exchange transaction in connection with the acquisition of Hyatt Regency Lost Pines Resort and Spa.
In conjunction with the 2014 sale of Park Hyatt Washington, we entered into a like-kind exchange agreement with an intermediary. Pursuant to the like-kind exchange agreement, the net proceeds of $97 million from the sale of this hotel were placed into an escrow account administered by a qualified intermediary. During the year ended December 31, 2014, these net proceeds were utilized as part of the like-kind exchange agreement to acquire Hyatt Regency Grand Cypress (see Note 9).
In conjunction with the sale of nine select service properties and one full service property during the year ended December 31, 2014, we entered into a like-kind exchange agreement with a qualified intermediary for seven of the select service hotels. During the year ended December 31, 2014, we recorded and released net proceeds of $232 million from restricted cash as they were utilized as part of the like-kind exchange agreement to acquire Hyatt Regency Orlando.
In conjunction with the 2013 sale of Hyatt Key West, we entered into a like-kind exchange agreement with a qualified intermediary. Pursuant to the like-kind exchange agreement, the net proceeds of $74 million from the sale of this hotel were placed into an escrow account administered by a qualified intermediary. During the year ended December 31, 2014, the net proceeds were released from restricted cash as they were utilized as part of the like-kind exchange agreement to acquire Hyatt Regency Orlando.
Goodwill and Intangible Assets, Net
Goodwill And Intangible Assets, Net
GOODWILL AND INTANGIBLE ASSETS, NET
 
Owned and Leased Hotels
 
Americas Management and Franchising
 
Total
Balance at January 1, 2015
 
 
 
 
 
Goodwill
$
195

 
$
33

 
$
228

Accumulated impairment losses
(95
)
 

 
(95
)
Goodwill, net
$
100

 
$
33

 
$
133

Activity during the year
 
 
 
 
 
Foreign exchange*
(4
)
 

 
(4
)
Balance at December 31, 2015
 
 
 
 
 
Goodwill
191

 
33

 
224

Accumulated impairment losses
(95
)
 

 
(95
)
Goodwill, net
$
96

 
$
33

 
$
129

Activity during the year
 
 
 
 
 
Foreign exchange*
(4
)
 

 
(4
)
Balance at December 31, 2016
 
 
 
 
 
Goodwill
187

 
33

 
220

Accumulated impairment losses
(95
)
 

 
(95
)
Goodwill, net
$
92

 
$
33

 
$
125


* Foreign exchange translation adjustments related to the goodwill associated with Hyatt Regency Mexico City.
The following is a summary of intangible assets:
 
December 31, 2016
 
Weighted Average Useful Lives
 
December 31, 2015
Management and franchise agreement intangibles
$
589

 
25

 
$
535

Lease related intangibles
115

 
111

 
136

Brand intangibles
16

 

 
7

Advanced booking intangibles
11

 
6

 
12

Other
6

 
14

 
8

 
737

 
 
 
698

Accumulated amortization
(138
)
 
 
 
(151
)
Intangibles, net
$
599

 
 
 
$
547


Amortization expense relating to intangible assets was as follows:
 
Years Ended December 31,
 
2016
 
2015
 
2014
Amortization expense
$
27

 
$
31

 
$
30


We estimate amortization expense for definite-lived intangibles as follows:
Years Ending December 31,
 
2017
$
32

2018
30

2019
30

2020
30

2021
29


During the years ended December 31, 2016 and December 31, 2015 we recorded no impairment charges. During the year ended December 31, 2014, we recognized $2 million of goodwill impairment within our owned and leased hotels segment and a $2 million impairment of management and franchise agreement intangibles which was recorded within our Americas management and franchising segment.
Debt
Debt
DEBT
 
December 31, 2016
 
December 31, 2015
$250 million senior unsecured notes maturing in 2016—3.875%
$

 
$
250

$196 million senior unsecured notes maturing in 2019—6.875%
196

 
196

$250 million senior unsecured notes maturing in 2021—5.375%
250

 
250

$350 million senior unsecured notes maturing in 2023—3.375%
350

 
350

$400 million senior unsecured notes maturing in 2026—4.850%
400

 

Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A
130

 
130

Contract Revenue Bonds, Senior Taxable Series 2005B
59

 
63

Floating average rate construction loan
79

 
65

Senior secured term loan

 
64

Revolving credit facility
100

 

Other
1

 

Long-term debt before capital lease obligations
1,565

 
1,368

Capital lease obligations
15

 
16

Total long-term debt
1,580

 
1,384

Less current maturities
(119
)
 
(328
)
Less unamortized discounts and deferred financing fees
(16
)
 
(14
)
Total long-term debt, net of current maturities
$
1,445

 
$
1,042


Under existing agreements, maturities of debt for the next five years and thereafter are as follows:
Years Ending December 31,
 
2017
$
119

2018
19

2019
215

2020
19

2021
269

Thereafter
939

Total
$
1,580


Senior Notes—At December 31, 2016 and December 31, 2015, we had various series of senior unsecured notes, as further defined below, (the "Senior Notes"). Interest on the Senior Notes is payable semi-annually. We may redeem all or a portion of the Senior Notes at any time at 100% of the principal amount of the Senior Notes redeemed together with the accrued and unpaid interest, plus a make-whole amount, if any. The amount of any make-whole payment depends, in part, on the yield of U.S. Treasury securities with a comparable maturity to the Senior Notes at the date of redemption. A summary of the terms of the Senior Notes, by year of issuance, is as follows:
In 2009, we issued $250 million of 6.875% senior notes due 2019, at an issue price of 99.864% (the "2019 Notes"). During the year ended December 31, 2013, we purchased $54 million aggregate principal amount of 2019 Notes in a cash tender offer at a purchase price of $66 million, which included premiums payable in connection with the cash tender offer. Following the cash tender offer, $196 million aggregate principal amount of 2019 Notes remains outstanding.
In 2011, we issued $250 million of 3.875% senior notes due 2016, at an issue price of 99.571% (the "2016 Notes"), and $250 million of 5.375% senior notes due 2021, at an issue price of 99.846% (the "2021 Notes"). During the year ended December 31, 2016, we redeemed all of our outstanding 2016 Notes, of which an aggregate principal amount of $250 million was outstanding. The redemption price, which was calculated in accordance with the terms of the 2016 Notes and included principal and accrued interest plus a make-whole premium, was $254 million. The make-whole premium was recorded within other income (loss), net on our consolidated statements of income, see Note 20.
In 2013, we issued $350 million of 3.375% senior notes due 2023 at an issue price of 99.498% (the "2023 Notes").
In 2016, we issued $400 million of 4.850% senior notes due 2026, at an issue price of 99.920% (the "2026 Notes" and together with the 2016 Notes, the 2019 Notes, 2021 Notes and the 2023 Notes, the "Senior Notes"). We received net proceeds of $396 million from the sale of the 2026 Notes, after deducting discounts and offering expenses of approximately $4 million. We used a portion of the net proceeds to pay for the redemption of the 2016 Notes (as described above), with the remaining proceeds intended to be used for general corporate purposes.
Senior Secured Term Loan— During the year ended December 31, 2016, we repaid $64 million of the senior secured term loan related to Hyatt Regency Lost Pines Resort and Spa, which we acquired during 2014 from an unconsolidated hospitality venture.
Capital Lease Obligation—During the year ended December 31, 2014, we acquired Hyatt Regency Grand Cypress for $191 million after exercising our purchase option which reduced our capital lease obligation. The purchase of Hyatt Regency Grand Cypress was used as a replacement property in a like-kind exchange (see Note 7).
Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A and Contract Revenue Bonds, Senior Taxable Series 2005B —During the year ended December 31, 2013, we acquired our partner's interest in the entity that owned Grand Hyatt San Antonio, and as a result, we consolidated $198 million of bonds, net of the $9 million bond discount, which is being amortized over the life of the bonds. The construction was financed in part by The City of San Antonio, Texas Convention Center Hotel Finance Corporation ("Texas Corporation"), a non-profit local government corporation created by the City of San Antonio, Texas for the purpose of providing financing for a portion of the costs of constructing the hotel. On June 8, 2005, the Texas Corporation issued $130 million of original principal amount Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A ("Series 2005A Bonds") and $78 million of original principal amount Contract Revenue Bonds, Senior Taxable Series 2005B ("Series 2005B Bonds"). The Series 2005A Bonds mature between 2034 and 2039, with interest ranging from 4.75% to 5.00% and the remaining Series 2005B Bonds mature between 2020 and 2028, with interest ranging from 5.1% to 5.31%. The loan payments are required to be funded solely from net operating revenues of Grand Hyatt San Antonio and in the event that net operating revenues are not sufficient to pay debt service, the Texas Corporation under certain circumstances will be required to provide certain tax revenue to pay debt service on the 2005 Series bonds. The indenture allows for optional early redemption of the Series 2005B bonds subject to make-whole payments at any time with consent from the Texas Corporation and beginning in 2015 for the Series 2005A Bonds. Interest is payable semiannually.
Floating Average Rate Construction Loan —During the year ended December 31, 2012, we obtained a secured construction loan with Banco Nacional de Desenvolvimento Econômico e Social - BNDES ("BNDES") in order to develop Grand Hyatt Rio de Janeiro. The loan is split into four separate sub-loans with different interest rates for each such sub-loan. All four sub-loans mature in 2023, with options to extend the maturity up to 2031 for sub-loan (a) and (b), subject to the fulfillment of certain conditions. Borrowings under the four sub-loans bear interest at the following rates, depending on the applicable sub-loan (a) the variable rate published by BNDES plus 2.92%, (b) the Brazilian Long Term Interest Rate - TJLP plus 3.92%, (c) 2.5% and (d) the Brazilian Long Term Interest Rate - TJLP, with the interest rates referred to in sub-loans (a) and (b) subject to reduction upon the delivery of certain certifications. On sub-loans (b) and (d), when the TJLP rate exceeds 6%, the amount corresponding to the TJLP portion above 6% is required to be capitalized daily. At December 31, 2016, the weighted average interest rates for the sub-loans we have drawn upon is 9.00%. The outstanding balance of the sub-loan subject to the interest rate described in (a) above is subject to adjustment on a daily basis based on BNDES’s calculation of the weighted average of exchange rate variations related to foreign currency funds raised by BNDES in foreign currency. At December 31, 2016, we borrowed Brazilian Real ("BRL") 258 million, or $79 million. At December 31, 2015, we borrowed BRL 260 million, or $65 million.
Revolving Credit Facility—At January 6, 2014, we entered into a Second Amended and Restated Credit Agreement with a syndicate of lenders that amended and restated our prior revolving credit facility and provides for a $1.5 billion senior unsecured revolving credit facility that matures in January 2019. Interest rates on outstanding borrowings are either LIBOR-based or based on an alternate base rate, with margins in each case based on our credit rating or, in certain circumstances, our credit rating and leverage ratio. During the year ended December 31, 2016, we had borrowings of $210 million and repayments of $110 million, resulting in an outstanding balance of $100 million at December 31, 2016. The weighted average interest rate on these borrowings was 1.63% at December 31, 2016. There was no outstanding balance on this revolving credit facility at December 31, 2015. At December 31, 2016 and December 31, 2015, we entered into various letter of credit agreements that did not reduce our available capacity under the revolving credit facility. The available line of credit on our revolving credit facility at December 31, 2016 was $1.4 billion.
The Company had $230 million and $228 million of letters of credit issued through additional banks at December 31, 2016 and December 31, 2015, respectively.
Fair Value—We estimated the fair value of debt, excluding capital leases, which consists of our Senior Notes and other long-term debt. Our Senior Notes and bonds are classified as Level Two due to the use and weighting of multiple market inputs in the final price of the security. We estimated the fair value of our other long-term debt instruments using discounted cash flow analysis based on current market inputs for similar types of arrangements. Based upon the lack of availability of market data, we have classified our other long-term debt as Level Three. The primary sensitivity in these calculations is based on the selection of appropriate discount rates. Fluctuations in these assumptions will result in different estimates of fair value.
We had the following debt balances, excluding capital lease obligations, as described above:
 
December 31, 2016
 
Carrying Value
 
Fair Value
 
Quoted Prices in Active Markets for Identical Assets (Level One)
 
Significant Other Observable Inputs (Level Two)
 
Significant Unobservable Inputs (Level Three)
Debt, excluding capital lease obligations
$
1,549

 
$
1,642

 
$

 
$
1,450

 
$
192

 
December 31, 2015
 
Carrying Value
 
Fair Value
 
Quoted Prices in Active Markets for Identical Assets (Level One)
 
Significant Other Observable Inputs (Level Two)
 
Significant Unobservable Inputs (Level Three)
Debt, excluding capital lease obligations
$
1,354

 
$
1,421

 
$

 
$
1,277

 
$
144

Leases
Leases
LEASES
We lease hotels and equipment under a combination of capital and operating leases, which generally require us to pay taxes, maintenance, and insurance. Most of the leases contain renewal options, which enable us to retain use of the facilities in desirable operating areas.
The operating leases for the majority of our leased hotels require the calculation of rental payments to be based on a percentage of the operating profit of the hotel, as defined by contract. As a result, future lease payments related to these leases are contingent upon operating results and are not included in the table below.
Corporate Office Space— We have sublease agreements with certain related parties at the Hyatt Center, see Note 17 for further discussion on related-party lease agreements.
The leases for our corporate headquarters expire in 2017 and 2020. In anticipation of the expiration of these leases, we entered into a new lease within a recently constructed office building for a term of 17 years. The future lease payments related to this new lease are included in the future minimum operating lease payments shown below.
The future minimum lease payments for our corporate office space and leased hotels due in each of the next five years and thereafter are as follows:
Years Ending December 31,
Operating Leases
 
Capital Leases
2017
$
41

 
$
2

2018
35

 
3

2019
39

 
3

2020
29

 
2

2021
26

 
2

Thereafter
444

 
8

Total minimum lease payments
$
614

 
$
20

Less amount representing interest
 
 
5

Present value of minimum lease payments
 
 
$
15


A summary of rent expense from continuing operations for all operating leases is as follows:
 
Years Ended December 31,
2016
 
2015
 
2014
Minimum rentals
$
37

 
$
34

 
$
35

Contingent rentals
53

 
53

 
49

Total
$
90

 
$
87

 
$
84


The Company leases retail space at its owned hotel locations under operating leases. We recorded rental income of $25 million, $28 million, and $28 million within owned and leased hotels revenues on our consolidated statements of income for the years ended December 31, 2016, December 31, 2015 and December 31, 2014, respectively. The future minimum lease receipts scheduled to be received in each of the next five years and thereafter are as follows:
Years Ending December 31,
 
2017
$
22

2018
17

2019
13

2020
12

2021
11

Thereafter
58

Total minimum lease receipts
$
133

Employee Benefit Plans
Employee Benefit Plans
EMPLOYEE BENEFIT PLANS
Defined Benefit Plans—We sponsor supplemental executive retirement plans consisting of funded and unfunded defined benefit plans for certain former executives. Retirement benefits are based primarily on the former employees’ salary, as defined, and are payable upon satisfaction of certain service and age requirements as defined by the plans. The accumulated benefit obligation related to the unfunded U.S. plan was $21 million at December 31, 2016 and December 31, 2015, of which $20 million was classified as a long-term liability, see Note 12. At December 31, 2016, we expect benefits of $1 million to be paid annually over the next 10 years.
Defined Contribution Plans—We provide retirement benefits to certain eligible employees under the Retirement Savings Plan (a qualified plan under Internal Revenue Code Section 401(k)), the FRP, and other similar plans. For the years ended December 31, 2016, December 31, 2015, and December 31, 2014, we recorded expenses of $36 million, $35 million, and $35 million, respectively, related to the Retirement Savings Plan based on a percentage of eligible employee contributions on stipulated amounts. The majority of these contributions relate to hotel property level employees, which are reimbursable to us and are included in the other revenues from managed properties and other costs from managed properties on our consolidated statements of income.
Deferred Compensation Plans—We provide nonqualified deferred compensation for certain employees through the DCP. Contributions and investment elections are determined by the employees, and the Company provides contributions to certain eligible employees according to pre-established formulas. The DCP is fully funded through a rabbi trust, therefore changes in the underlying securities impact the deferred compensation liability, which is recorded in other long-term liabilities (see Note 12) and the corresponding marketable securities assets (see Note 4).
Employee Stock Purchase Program—We provide the Hyatt Hotels Corporation ESPP, which qualifies under Section 423 of the Internal Revenue Code. The ESPP provides eligible employees the opportunity to purchase shares of the Company’s common stock on a quarterly basis through payroll deductions at a price equal to 95% of the fair value on the last trading day of each quarter. Approximately 76,000 shares and 69,000 shares were issued under the ESPP during 2016 and 2015, respectively.
Other Long-Term Liabilities
Other Long-Term Liabilities
OTHER LONG-TERM LIABILITIES
Other long-term liabilities consisted of the following:
 
December 31, 2016
 
December 31, 2015
Deferred gains on sales of hotel properties
$
363

 
$
367

Deferred compensation plans (see Note 11)
352

 
333

Hyatt Gold Passport Fund (see Note 2)
296

 
280

Guarantee liabilities (see Note 14)
124

 
120

Other accrued income taxes (see Note 13)
100

 
127

Deferred income taxes (see Note 13)
57

 
59

Defined benefit plans (see Note 11)
20

 
20

Other
160

 
141

Total
$
1,472

 
$
1,447

Income Taxes
Income Taxes
INCOME TAXES
Our tax provision includes federal, state, local, and foreign income taxes. The domestic and foreign components of income before income taxes are as follows:
 
Years Ended December 31,
2016
 
2015
 
2014
U.S. income before tax
$
180

 
$
119

 
$
493

Foreign income before tax
109

 
75

 
32

Income before income taxes
$
289

 
$
194

 
$
525


The provision (benefit) for income taxes from continuing operations is comprised of the following:
 
Years Ended December 31,
2016
 
2015
 
2014
Current:
 
 
 
 
 
Federal
$
66

 
$
134

 
$
164

State
15

 
18

 
7

Foreign
7

 
21

 
36

Total Current
$
88

 
$
173

 
$
207

Deferred:
 
 
 
 
 
Federal
$
(12
)
 
$
(78
)
 
$
(10
)
State
(2
)
 
(20
)
 
(6
)
Foreign
11

 
(5
)
 
(12
)
Total Deferred
$
(3
)
 
$
(103
)
 
$
(28
)
Total
$
85

 
$
70

 
$
179


The following is a reconciliation of the statutory federal income tax rate to the effective tax rate from continuing operations:
 
Years Ended December 31,
2016
 
2015
 
2014
Statutory U.S. federal income tax rate
35.0
 %
 
35.0
 %
 
35.0
 %
State income taxes—net of federal tax benefit
3.4

 
3.5

 
3.4

Impact of foreign operations (excluding unconsolidated hospitality ventures losses)
(5.4
)
 
(13.8
)
 
0.9

Foreign unconsolidated hospitality ventures
1.2

 
10.0

 
0.8

Playa foreign tax credit benefit
(2.6
)
 

 

Tax contingencies
(5.2
)
 
(1.5
)
 
(2.6
)
Change in valuation allowances
3.6

 
3.1

 
(1.0
)
General business credits
(0.8
)
 
(1.9
)
 
(0.4
)
Equity based compensation
0.4

 
(0.5
)
 
0.4

Other
(0.1
)
 
2.3

 
(2.4
)
Effective income tax rate
29.5
 %
 
36.2
 %
 
34.1
 %

Significant items affecting the 2016 effective tax rate include benefits related to the rate differential of foreign operations, foreign tax credit benefits associated with the Playa foreign unconsolidated hospitality venture and a $15 million benefit (including $4 million of interest and penalties) primarily related to the reversal of uncertain tax positions for certain foreign filing positions. These benefits are partially offset by the impact of certain foreign net operating losses generated in the current year that are not expected to be utilized in the future.
Significant items affecting the 2015 effective tax rate include a benefit related to the impact of global transfer pricing changes implemented during 2015 to better align the Company’s transfer pricing with the Company’s global business operating model. This benefit is offset by the effect of certain foreign unconsolidated hospitality venture losses that are not fully benefited. The impact of tax contingencies includes a benefit of $10 million (including $5 million of interest and penalties) due to statute expirations with respect to state and foreign tax filing positions and an expense of $7 million due to an uncertain tax position recorded during 2015 related to transfer pricing positions.
For 2014, significant items affecting the effective tax rate include a benefit of $14 million related to tax contingencies and an $8 million benefit for an adjustment to certain deferred tax assets. The $14 million benefit related to tax contingencies is derived primarily from a benefit of $13 million (including $7 million of interest and penalties) due to statute expiration on state tax filing positions, an expense of $5 million due to an uncertain tax position recorded during 2014 related to an accrual of a position taken on a prior year tax return and a benefit of $4 million related to the expiration of statutes in foreign jurisdictions.
The components of the net deferred tax assets and deferred tax liabilities are comprised of the following:
 
December 31, 2016
 
December 31, 2015
Deferred tax assets related to:
 
 
 
Employee benefits
$
202

 
$
196

Foreign and state net operating losses and credit carryforwards
46

 
34

Investments
55

 
70

Allowance for uncollectible assets
36

 
36

Intangibles

 
4

Deferred gains on sales of hotel properties
134

 
142

Hyatt Gold Passport Fund
81

 
81

Interest and state benefits
2

 
2

Unrealized losses
5

 
5

Other
54

 
50

Valuation allowance
(27
)
 
(17
)
Total deferred tax asset
$
588

 
$
603

Deferred tax liabilities related to:
 
 
 
Property and equipment
$
(224
)
 
$
(258
)
Investments
(28
)
 
(33
)
Intangibles
(14
)
 

Unrealized gains
(39
)
 
(45
)
Prepaid expenses
(12
)
 
(13
)
Other
(15
)
 
(12
)
Total deferred tax liabilities
$
(332
)
 
$
(361
)
Net deferred tax assets
$
256

 
$
242

Recognized in the balance sheet as:
 
 
 
Deferred tax assets—noncurrent
$
313

 
$
301

Deferred tax liabilities—noncurrent
(57
)
 
(59
)
Total
$
256

 
$
242


Significant changes to our deferred tax assets and liabilities during 2016 include a decreased property and equipment deferred tax liability of $34 million as a result of book depreciation in excess of tax depreciation and an $18 million decrease of intangible deferred tax assets, due to amortization.
Significant changes to our deferred tax assets and liabilities during 2015 includes an increase of $60 million due to a deferred tax asset recorded in conjunction with an uncertain tax position accrual related to the U.S. tax treatment of the Hyatt Gold Passport Fund and book depreciation in excess of tax depreciation related to property and equipment of $54 million. This is partially offset by an increase in unrealized gains related to our preferred investment recorded to other comprehensive income (loss). Additional significant changes relate to the recording of employee benefit costs that are not currently deductible.
At December 31, 2016, we have determined that undistributed net earnings of $504 million of certain foreign subsidiaries are indefinitely reinvested in jurisdictions outside the United States. These earnings are being used to fund our development pipeline and any recurring capital expenditures related to jurisdictions outside the United States. These earnings could become subject to additional taxes if remitted as dividends, loaned to a U.S. affiliate, or if we sold our interest in the affiliates; the resulting U.S. income tax liabilities could be offset, in whole or in part, by credits allowable for taxes paid to foreign jurisdictions. The actual tax costs would depend on the income tax laws and circumstances at the time of the realization events; determination of the potential net liability is not practicable due to the complexities of the hypothetical calculation.
At December 31, 2016, we have $164 million gross ($36 million deferred tax asset) of future tax benefits related to foreign and state net operating losses and $10 million of benefits related to federal and state credits. A portion of these operating losses expire in 2017; the remainder will expire over time through 2036. However, $51 million of these gross net operating losses ($11 million deferred tax asset), which are primarily foreign, have no expiration date and may be carried forward indefinitely. A valuation allowance of $27 million is recorded for certain deferred tax assets related to net operating losses and credits that we do not believe are more likely than not to be realized.
Total unrecognized tax benefits at December 31, 2016 and December 31, 2015 were $86 million and $110 million, respectively, of which $5 million and $21 million, respectively, would impact the effective tax rate if recognized. It is reasonably possible that a reduction of up to $3 million of unrecognized tax benefits could occur within 12 months resulting from the expiration of certain tax statutes of limitations.
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
 
2016
 
2015
Unrecognized tax benefits—beginning balance
$
110

 
$
40

Total increases—current period tax positions
2

 
13

Total (decreases) increases—prior period tax positions
(21
)
 
69

Lapse of statute of limitations
(5
)
 
(8
)
Foreign currency fluctuation

 
(4
)
Unrecognized tax benefits—ending balance
$
86

 
$
110


For 2016, the net decrease in uncertain tax positions was $24 million. The decrease in prior period tax positions primarily related to the reversal of uncertain tax positions for certain filing positions in foreign jurisdictions. The lapse of statute limitations was due to various state and foreign tax filing positions.
For 2015, the net increase in uncertain tax positions was $70 million. The current period increase of $13 million was primarily driven by a $7 million accrual related to transfer pricing positions taken in the current year. The increase in prior period tax positions of $69 million primarily related to an accrual of $60 million for the U.S. tax treatment of the Hyatt Gold Passport Program, as well as recording a long-term receivable related to a cross jurisdictional tax contingency. The aforementioned increases were partially offset by a decrease of $8 million due to statute expirations on various state and foreign tax filing positions.
We recognize accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. Total gross accrued interest and penalties were $14 million and $19 million at December 31, 2016 and December 31, 2015, respectively.
The amount of interest and penalties recognized as a component of income tax expense in 2016 was a benefit of $4 million. This amount is comprised of a benefit of $9 million resulting from the release of interest and penalties related to certain foreign tax positions and an additional interest and penalty accrual of $5 million on federal, state and foreign tax matters.
The amount of interest and penalties recognized as a component of income tax expense in 2015 was a benefit of $2 million. This amount is comprised of a benefit of $5 million resulting from the release of interest and penalties due to state and foreign tax statute expirations and an additional interest and penalty accrual of $3 million on federal, state and foreign tax matters.
We are subject to audits by federal, state and foreign tax authorities. U.S. tax years 2012, 2013 and 2014 are currently under field examination by the IRS. Our 2009, 2010, and 2011 federal income tax returns are currently at IRS appeals level. We received a Notice of Proposed Adjustment ("NOPA") during the third quarter of 2015 related to the tax treatment of the Hyatt Gold Passport Fund. We disagree with the proposed adjustment, but if the NOPA is sustained, it would result in an additional current tax liability of $140 million (including interest of $41 million) that would be primarily offset by a deferred tax asset and, therefore, only a portion of the related interest would have an impact on the effective tax rate if recognized. The statute of limitations for U.S. tax years 2005, 2006, 2007 and 2008 remain open for the computational impacts of net operating losses and general business credit carrybacks to those years which could be impacted by the final resolution of tax years 2009-2011.
We have several state and foreign audits pending. State income tax returns are generally subject to examination for a period of three to five years after filing of the return. However, the state impact of any federal changes remains subject to examination by various states for a period generally up to one year after formal notification to the states of the federal changes. The statute of limitations for the foreign jurisdictions ranges from three to ten years after filing the applicable tax return.
Commitments and Contingencies
Commitments And Contingencies
COMMITMENTS AND CONTINGENCIES
In the ordinary course of business, we enter into various commitments, guarantees, surety bonds, and letter of credit agreements, which are discussed below:
Commitments—At December 31, 2016, we are committed, under certain conditions, to lend or invest up to $378 million, net of any related letters of credit, in various business ventures.
During the year ended December 31, 2016, we entered into a commitment to fund up to $50 million of preferred equity into a third-party entity which is developing a hotel in Seattle, Washington, for which we also provided a debt repayment guarantee. During the year ended December 31, 2016, we also entered into a commitment to purchase land and a to-be-constructed hotel located in Portland, Oregon from the developer for a purchase price of approximately $160 million upon substantial completion of construction.
Performance Guarantees—Certain of our contractual agreements with third-party owners require us to guarantee payments to the owners if specified levels of operating profit are not achieved by their hotels, see Note 2.
Our most significant performance guarantee relates to four managed hotels in France that we began managing in the second quarter of 2013 ("the four managed hotels in France"), which has a term of 7 years, with approximately 3.5 years remaining, and does not have an annual cap. The remaining maximum exposure related to our performance guarantees at December 31, 2016 was $346 million, of which €293 million ($308 million using exchange rates at December 31, 2016) related to the four managed hotels in France.
We had total net performance guarantee liabilities of $79 million and $97 million at December 31, 2016 and December 31, 2015, respectively, which included $55 million and $81 million recorded in other long-term liabilities and $24 million and $16 million in accrued expenses and other current liabilities on our consolidated balance sheets, respectively. Our total performance guarantee liabilities are comprised of the fair value of the guarantee obligation liabilities recorded upon inception, net of amortization and any separate contingent liabilities, net of cash payments. Performance guarantee expense or income and income from amortization of the guarantee obligation liabilities are recorded in other income (loss), net on the consolidated statements of income, see Note 20.
 
 
The Four Managed Hotels in France
 
Other Performance Guarantees
 
Total
 
 
2016
 
2015
 
2016
 
2015
 
2016
 
2015
Beginning balance, January 1
 
$
93

 
$
106

 
$
4

 
$
5

 
$
97

 
$
111

Initial guarantee obligation liability
 

 

 
9

 

 
9

 

Amortization of initial guarantee obligation liability into income
 
(33
)
 
(10
)
 
(1
)
 
(2
)
 
(34
)
 
(12
)
Performance guarantee expense (income), net
 
64

 
28

 
(1
)
 
(1
)
 
63

 
27

Net (payments) receipts during the year
 
(57
)
 
(20
)
 
2

 
2

 
(55
)
 
(18
)
Foreign currency exchange, net
 
(1
)
 
(11
)
 

 

 
(1
)
 
(11
)
Ending balance, December 31
 
$
66

 
$
93

 
$
13

 
$
4

 
$
79

 
$
97


Additionally, we enter into certain management contracts where we have the right, but not an obligation, to make payments to certain hotel owners if their hotels do not achieve specified levels of operating profit. If we choose not to fund the shortfall, the hotel owner has the option to terminate the management contract. At December 31, 2016 and December 31, 2015, there were no amounts recorded on our consolidated balance sheets related to these performance test clauses.
Debt Repayment Guarantees—We have entered into various debt repayment guarantees related to our unconsolidated hospitality venture investments and certain managed or franchised hotels. Typically, we enter into debt repayment guarantees in order to assist hotel owners in obtaining third-party financing or to obtain more favorable borrowing terms. Included within debt repayment guarantees are the following:
Property Description
 
Maximum Potential Future Payments
 
Maximum Exposure Net of Recoverability from Third Parties
 
Amount Recorded at December 31, 2016
 
Amount Recorded at December 31, 2015
 
Year of Guarantee Expiration
Hotel property in Washington (1), (3), (4), (5)
 
$
215

 
$

 
$
35

 
$

 
2020
Hotel properties in India (2), (3)
 
177

 
177

 
21

 
27

 
2020
Hotel property in Brazil (1)
 
80

 
40

 
3

 
4

 
2020
Hotel property in Minnesota
 
25

 
25

 
2

 
2

 
2021
Hotel property in Arizona (1), (4)
 
25

 

 
2

 
3

 
2019
Hotel properties in California (1)
 
21

 
8

 
6

 

 
2020
Hotel property in Colorado
 
8

 
8

 

 

 
2017
Other (1)
 
25

 
1

 

 
3

 
various, through 2017
Total
 
$
576

 
$
259

 
$
69

 
$
39

 
 

(1) We have agreements with either our unconsolidated hospitality venture partner, the respective hotel owners or other third parties to recover certain amounts funded under the debt repayment guarantee; the recoverability mechanism may be in the form of cash, financing receivable, or HTM debt securities.
(2) We have the contractual right to recover amounts funded from the unconsolidated hospitality venture, which is a related party. We expect our maximum exposure to be $89 million, taking into account our partner’s 50% ownership interest in the unconsolidated hospitality venture.
(3) Under certain events or conditions, we have the right to force the sale of the property(ies) in order to recover amounts funded.
(4) If certain funding thresholds are met or if certain events occur, we have the ability to assume control of the property.
(5) We are subject to a completion guarantee whereby the parties agree to substantially complete the construction of the project by a specified date. In the event of default, we are obligated to complete construction using the funds available from the outstanding loan. Any additional funds paid by us are subject to recovery through a HTM debt security.
At December 31, 2016, the hotel owners are current on their debt service obligations.
Guarantee Liabilities Fair Value—We estimated the fair value of our guarantees to be $231 million and $179 million at December 31, 2016 and December 31, 2015, respectively. Due to the lack of readily available market data, our fair value estimates utilize the following Level Three unobservable inputs:
 
2016
 
2015
Discount rates
10.6% - 12.6%
 
9.5% - 12.6%
Stabilized growth rates
1.8% - 4.8%
 
1.8% - 4.8%
Capitalization rates (1)
7.0% - 10.0%
 
6.5% - 10.0%
Term
0.2 - 7.0 years
 
0.3 - 5.0 years
(1) Reflects the risk profile of the individual markets where the assets are located and are not necessarily indicative of our portfolio as a whole.
Insurance—We obtain commercial insurance for potential losses for general liability, workers' compensation, automobile liability, employment practices, crime, property and other miscellaneous coverages. A portion of the risk is retained on a self insurance basis primarily through U.S. based and licensed captive insurance companies that are wholly owned subsidiaries of Hyatt and that generally insure our deductibles and retentions. Reserve requirements are established based on actuarial projections of ultimate losses. Losses estimated to be paid within twelve months are $30 million and $35 million at December 31, 2016 and December 31, 2015, respectively, and are classified within accrued expenses and other current liabilities on our consolidated balance sheets, while losses expected to be payable in future periods are $62 million and $57 million at December 31, 2016 and December 31, 2015, respectively, and are included in other long-term liabilities on the consolidated balance sheets. At December 31, 2016, standby letters of credit of $7 million were issued to provide collateral for the estimated claims, which are guaranteed by us. For further discussion, see the "—Letters of Credit" section of this footnote.
Collective Bargaining Agreements—At December 31, 2016, approximately 25% of our U.S. based employees were covered by various collective bargaining agreements, generally providing for basic pay rates, working hours, other conditions of employment and orderly settlement of labor disputes. Certain employees are covered by union sponsored multi-employer pension and health plans pursuant to agreements between us and various unions. Our contributions to these multi-employer pension and health plans are based on a percentage of all union employee wages as dictated by the collective bargaining agreements, which expire at various dates between August 31, 2018 and June 30, 2026. Generally, labor relations have been maintained in a normal and satisfactory manner, and we believe our employee relations are good.
Surety Bonds—Surety bonds issued on our behalf were $25 million at December 31, 2016 and primarily relate to workers’ compensation, taxes, licenses and utilities related to our lodging operations.
Letters of Credit—Letters of credit outstanding on our behalf at December 31, 2016 were $230 million, which relate to our ongoing operations and securitization of our performance under our debt repayment guarantee associated with the hotel properties in India, which is only called upon if we default on our guarantee. The letters of credit outstanding do not reduce the available capacity under our revolving credit facility (see Note 9).
Capital Expenditures—As part of our ongoing business operations, significant expenditures are required to complete renovation projects that have been approved.
Other—We act as general partner of various partnerships owning hotel properties that are subject to mortgage indebtedness. These mortgage agreements generally limit the lender’s recourse to security interests in assets financed and/or other assets of the partnership(s) and/or the general partner(s) thereof.
In conjunction with financing obtained for our unconsolidated hospitality ventures and certain managed hotels, we may provide standard indemnifications to the lender for loss, liability or damage occurring as a result of our actions or actions of the other unconsolidated hospitality venture owners.
We are subject, from time to time, to various claims and contingencies related to lawsuits, taxes, and environmental matters, as well as commitments under contractual obligations. Many of these claims are covered under the current insurance programs, subject to deductibles. We recognize a liability associated with commitments and contingencies when a loss is probable and reasonably estimable. Although the ultimate liability for these matters cannot be determined at this point, based on information currently available, we do not expect the ultimate resolution of such claims and litigation will have a material effect on our consolidated financial statements.
Stockholders' Equity and Comprehensive Loss
Stockholders' Equity and Comprehensive Loss
STOCKHOLDERS’ EQUITY AND COMPREHENSIVE LOSS
Common Stock—At December 31, 2016, Pritzker family business interests beneficially owned, in the aggregate, approximately 83.6% of our Class B common stock and less than 0.1% of our Class A common stock, representing approximately 58.1% of the outstanding shares of our common stock and approximately 80.1% of the total voting power of our outstanding common stock. As a result, consistent with the voting agreements contained in the Amended and Restated Global Hyatt Agreement and Amended and Restated Foreign Global Hyatt Agreement, Pritzker family business interests are able to exert a significant degree of influence or actual control over our management and affairs and over matters requiring stockholder approval, including the election of directors and other significant corporate transactions. While the voting agreements are in effect, they may provide our board of directors with effective control over matters requiring stockholder approval. Because of our dual class ownership structure, Pritzker family business interests will continue to exert a significant degree of influence or actual control over matters requiring stockholder approval, even if they own less than 50% of the outstanding shares of our common stock. Pursuant to the Amended and Restated Global Hyatt Agreement and Amended and Restated Foreign Global Hyatt Agreement, the Pritzker family business interests have agreed to certain voting agreements and to certain limitations with respect to the sale of shares of our common stock. In addition, other stockholders, including entities affiliated with Goldman, Sachs & Co. and Madrone GHC, LLC, beneficially own, in the aggregate, approximately 16.4% of our outstanding Class B common stock and approximately 7.9% of our outstanding Class A common stock, representing approximately 13.8% of the outstanding shares of our common stock and approximately 16.1% of the total voting power of our outstanding common stock. Pursuant to the 2007 Stockholders’ Agreement, these entities have also agreed to certain voting agreements and to certain limitations with respect to the sale of shares of our common stock.
Share Repurchase— During 2016, 2015 and 2014, our board of directors authorized the repurchase of up to $500 million, $400 million and $700 million, respectively, of our common stock. These repurchases may be made from time to time in the open market, in privately negotiated transactions, or otherwise, including pursuant to a Rule 10b5-1 plan, at prices that we deem appropriate and subject to market conditions, applicable law and other factors deemed relevant in our sole discretion. The common stock repurchase program applies to our Class A common stock and/or our Class B common stock. The common stock repurchase program does not obligate us to repurchase any dollar amount or number of shares of common stock and the program may be suspended or discontinued at any time.
During 2016 and 2015, we repurchased 5,631,557 and 13,199,811 shares of common stock, respectively. These shares of common stock were repurchased at a weighted average price of $48.37 and $54.17 per share, respectively, for an aggregate purchase price of $272 million and $715 million, respectively, excluding related insignificant expenses in both periods. The shares repurchased during 2016 represented approximately 4% of our total shares of common stock outstanding at December 31, 2015. The shares repurchased during 2015 represented approximately 9% of our total shares of common stock outstanding at December 31, 2014. The shares of Class A common stock repurchased on the open market were retired and returned to the status of authorized and unissued while the shares of Class B common stock repurchased were retired and the total number of authorized Class B shares was reduced by the number of shares repurchased. At December 31, 2016, we had $357 million remaining under the current share repurchase authorization.
Treasury Stock Retirement— During 2015, we retired 195,423 shares of treasury stock. These shares were retired at a weighted average price of $43.41 resulting in an $8 million reduction in treasury stock. The retired shares of treasury stock were returned to the status of authorized and unissued.
Accumulated Other Comprehensive Loss—The following tables detail the accumulated other comprehensive loss activity for the years ended December 31, 2016 and December 31, 2015, respectively.
 
Balance at
January 1, 2016
 
Current period other comprehensive income (loss) before reclassification
 
Amount reclassified from accumulated other comprehensive loss (a)
 
Balance at
December 31, 2016
Foreign currency translation adjustments
$
(257
)
 
$
(45
)
 
$
3

 
$
(299
)
Unrealized gains (losses) on AFS securities
39

 
(6
)
 

 
33

Unrecognized pension cost
(7
)
 

 

 
(7
)
Unrealized gains (losses) on derivative instruments
(5
)
 
1

 

 
(4
)
Accumulated other comprehensive income (loss)
$
(230
)
 
$
(50
)
 
$
3

 
$
(277
)
(a) The amount reclassified from accumulated other comprehensive loss related to the sale of the shares of the company that owns Hyatt Regency Birmingham (U.K.) and was recorded within other long-term liabilities on our consolidated balance sheets.
 
 
 
 
 
 
 
 
 
Balance at
January 1, 2015
 
Current period other comprehensive income (loss) before reclassification
 
Amount reclassified from accumulated other comprehensive loss (b)
 
Balance at
December 31, 2015
Foreign currency translation adjustments
$
(155
)
 
$
(123
)
 
$
21

 
$
(257
)
Unrealized gains on AFS securities
6

 
33

 

 
39

Unrecognized pension cost
(5
)
 
(2
)
 

 
(7
)
Unrealized gains (losses) on derivative instruments
(6
)
 
1

 

 
(5
)
Accumulated other comprehensive income (loss)
$
(160
)
 
$
(91
)
 
$
21

 
$
(230
)
(b) The amount reclassified from accumulated other comprehensive loss was recognized within equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
Stock-Based Compensation
Stock-Based Compensation
STOCK-BASED COMPENSATION
As part of our LTIP, we award SARs, RSUs, PSUs and PSs to certain employees, see Note 2. Compensation expense and unearned compensation presented below exclude amounts related to employees of our managed hotels and other employees whose payroll is reimbursed, as this expense has been and will continue to be reimbursed by our third-party hotel owners and is recorded within other revenues from managed properties and other costs from managed properties on our consolidated statements of income. Stock-based compensation expense (income) primarily included in selling, general, and administration expense on our consolidated statements of income related to these awards was as follows:
 
Years Ended December 31,
 
2016
 
2015
 
2014
SARs
$
10

 
$
9

 
$
19

RSUs
15

 
17

 
31

PSUs and PSs

 
(3
)
 
4


The years ended December 31, 2016 and December 31, 2015 include a reversal of previously recorded compensation expense based on our current assessment of expected achievement relative to the applicable performance target related to certain PS awards.
The year ended December 31, 2014 includes a nonrecurring expense of $23 million, a portion of which relates to prior periods for grants made to certain individuals. The nonrecurring expense for SARs and RSUs shown in the table above for the year ended December 31, 2014 amounted to $10 million and $13 million, respectively, of which $22 million is recorded in selling, general, and administrative expenses on our consolidated statements of income.
The expected income tax benefit to be realized at the time of vest related to these awards for the years ended December 31, 2016, December 31, 2015 and December 31, 2014 was as follows: 
 
Years Ended December 31,
 
2016
 
2015
 
2014
SARs
$
4

 
$
3

 
$
7

RSUs
5

 
5

 
8

PSUs and PSs

 
(1
)
 
2


SARs—The following table sets forth a summary of the SAR grants in 2016, 2015, and 2014: 
Grant Date
 
SARs Granted
 
Value at Date of Grant
 
Vesting Period
 
Vesting Start Month
March 2016
 
45,710

 
$
14.22

 
33
% annually
 
March 2017
March 2016
 
878,714

 
14.54

 
25
% annually
 
March 2017
March 2015
 
380,604

 
20.64

 
25
% annually
 
March 2016
March 2015
 
41,373

 
24.17

 
50
% annually
 
March 2018
February 2015
 
39,401

 
25.38

 
100
% at vest
 
March 2018
February 2014
 
327,307

 
22.57

 
25
% annually
 
March 2015

The weighted average grant date fair value for the awards granted in 2016, 2015 and 2014 was $14.52, $21.36, and $22.57, respectively.
The fair value of each SAR was estimated based on the date of grant using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions: 
 
2016
 
2015
 
2014
Exercise Price
$
47.36

 
$
56.57

 
$
49.39

Expected Life in Years
6.227

 
6.309

 
6.290

Risk-free Interest Rate
1.55
%
 
1.63
%
 
1.93
%
Expected Volatility
27.72
%
 
35.39
%
 
44.32
%
Annual Dividend Yield
%
 
%
 
%

At December 31, 2016 we used an estimated forfeiture rate of 0% because only a small group of executives received these grants and we have limited data on which to base these estimates. Due to a lack of historical exercise information the expected life was estimated based on the midpoint between the vesting period and the contractual life of each SAR. The risk-free interest rate was based on U.S. Treasury instruments with similar expected life. We calculate volatility using a blend of our trading history and an average historical volatility of our peer group over a time period consistent with our expected term assumption.
A summary of employee SAR activity is presented below: 
 
SAR Units
 
Weighted Average Exercise Price (in whole dollars)
 
Weighted Average Contractual Term
Outstanding at December 31, 2015:
3,876,937

 
$
47.63

 
5.03
Granted
924,424

 
47.36

 
9.22
Exercised
(325,339
)
 
43.09

 
2.08
Forfeited or canceled
(22,035
)
 
53.32

 
5.04
Outstanding at December 31, 2016:
4,453,987

 
$
47.88

 
5.25
Exercisable at December 31, 2016:
2,855,153

 
$
47.09

 
3.44

The total intrinsic value of SARs outstanding at December 31, 2016 was $39 million and the total intrinsic value for exercisable SARs was $29 million at December 31, 2016.
RSUs—The following table sets forth a summary of the employee RSU grants: 
Grant Date
 
RSUs
 
Value
 
Total Value (in millions)
 
Vesting Period
December 2016
 
40,633

 
$
56.60

 
$
2

 
4 years
March 2016
 
444,629

 
47.36

 
21

 
4 years
December 2015
 
4,089

 
48.90

 

 
4 years
September 2015
 
3,898

 
51.30

 

 
3 years
September 2015
 
8,576

 
51.30

 

 
4 years
May 2015
 
23,746

 
58.95

 
1

 
4 years
March 2015
 
380,939

 
56.27

 
21

 
4 years
February 2015
 
29,278

 
59.77

 
2

 
4 years
September 2014
 
2,452

 
61.17

 

 
4 years
February 2014
 
376,328

 
49.39

 
19

 
4 years

The liability and related expense for granted cash-settled RSUs are insignificant as of and for the year ended December 31, 2016.
A summary of the status of the nonvested employee restricted stock unit awards outstanding under the LTIP is presented below: 
 
Restricted Stock
Units
 
Weighted Average Grant Date Fair Value (in whole dollars)
Nonvested at December 31, 2015:
1,014,574

 
$
50.02

Granted
485,262

 
48.13

Vested
(394,087
)
 
47.42

Forfeited or canceled
(89,572
)
 
49.78

Nonvested at December 31, 2016:
1,016,177

 
$
50.15


Our estimated forfeiture rate is approximately 3%. The total intrinsic value of nonvested RSUs at December 31, 2016 was $56 million.
PSUs and PSs—The following table sets forth a summary of PSU and PS grants:
Year Granted
 
PSUs and PSs Granted
 
Weighted Average Grant Date Fair Value (in whole dollars)
 
Performance Period
 
Performance Period Start Date
2016 PSUs
 
111,620

 
$
47.36

 
3 years
 
January 1, 2016
2015 PSs
 
146,902

 
$
56.27

 
3 years
 
January 1, 2015
2014 PSs
 
162,906

 
$
49.39

 
3 years
 
January 1, 2014

There were $8 million in forfeitures for the year ended December 31, 2016. At December 31, 2016 the total intrinsic value of nonvested PSs and PSUs if target performance is achieved was $6 million.
Unearned Compensation—Our total unearned compensation for our stock-based compensation programs at December 31, 2016 was $6 million for SARs, $15 million for RSUs and $4 million for PSUs and PSs, which is expected to be recorded to compensation expense as follows: 
 
2017
 
2018
 
2019
 
2020
 
Total
SARs
$
3

 
$
2

 
$
1

 
$

 
$
6

RSUs
7

 
4

 
3

 
1

 
15

PSUs and PSs
2

 
2

 

 

 
4

Total
$
12

 
$
8

 
$
4

 
$
1

 
$
25

Related-Party Transactions
Related-Party Transactions
RELATED-PARTY TRANSACTIONS
In addition to those included elsewhere in the Notes to the consolidated financial statements, related-party transactions entered into by us are summarized as follows:
Leases —Our corporate headquarters have been located at the Hyatt Center in Chicago, Illinois since 2005. A subsidiary of the Company holds a master lease for a portion of the Hyatt Center and has entered into sublease agreements with certain related parties. Future expected sublease income for this space from related parties is $4 million.
Legal Services—A partner in a law firm that provided services to us throughout 2016, 2015, and 2014 is the brother-in-law of our Executive Chairman. We incurred legal fees with this firm of $2 million, $6 million and $3 million for each of the years ended December 31, 2016, December 31, 2015, and December 31, 2014, respectively. Legal fees, when expensed, are included in selling, general, and administrative expenses. At December 31, 2016 and December 31, 2015, we had insignificant amounts due to the law firm.
Equity Method Investments—We have equity method investments in entities that own properties for which we provide management or franchise services and receive fees. We recorded fees of $30 million, $26 million, and $29 million for the years ended December 31, 2016, December 31, 2015, and December 31, 2014, respectively. At December 31, 2016 and December 31, 2015, we had receivables due from these properties of $7 million and $6 million, respectively. In addition, in some cases we provide loans (see Note 6) or guarantees (see Note 14) to these entities. During the years ended December 31, 2016, December 31, 2015, and December 31, 2014, we recorded fees related to these guarantees of $5 million, $2 million, and $2 million, respectively. Our ownership interest in these unconsolidated hospitality ventures varies from 24% to 70%. See Note 3 for further details regarding these investments.
Class B Share Repurchase—During 2016, we repurchased 1,881,636 shares of Class B common stock for a weighted average price of $53.15 per share, for an aggregate purchase price of approximately $100 million. The shares repurchased represented approximately 1% of our total shares of common stock outstanding prior to the repurchase. During 2015, we repurchased 1,776,501 shares of Class B common stock at a weighted average price of $58.91 per share, for an aggregate purchase price of approximately $105 million. The shares repurchased represented approximately 1% of our total shares of common stock outstanding prior to the repurchase. The shares of Class B common stock were repurchased in privately negotiated transactions from trusts for the benefit of certain Pritzker family members and limited partnerships owned indirectly by trusts for the benefit of certain Pritzker family members and were retired, thereby reducing the total number of shares outstanding and reducing the shares of Class B common stock authorized and outstanding by the repurchased share amount.
Class B Share Conversion—During the year ended December 31, 2016, 16,884,117 shares of Class B common stock were converted on a share-for-share basis into shares of our Class A common stock, $0.01 par value per share. The shares of Class B common stock that were converted into shares of Class A common stock have been retired, thereby reducing the shares of Class B common stock authorized and outstanding.
Segment and Geographic Information
Segment and Geographic Information
SEGMENT AND GEOGRAPHIC INFORMATION
Our reportable segments are components of the business which are managed discretely and for which discrete financial information is reviewed regularly by the chief operating decision maker to assess performance and make decisions regarding the allocation of resources. Our chief operating decision maker is the President and Chief Executive Officer. We define our reportable segments as follows:
Owned and leased hotels—This segment derives its earnings from owned and leased hotel properties located predominantly in the United States, but also in certain international locations and for purposes of segment Adjusted EBITDA, includes our pro rata share of the Adjusted EBITDA of our unconsolidated hospitality ventures, based on our ownership percentage of each venture. Adjusted EBITDA includes intercompany expenses related to management fees paid to the Company's management and franchising segments, which are eliminated in consolidation. Intersegment revenues relate to promotional award redemptions earned by our owned and leased hotels related to our co-branded credit card, which are eliminated in consolidation.
Americas management and franchising—This segment derives its earnings primarily from a combination of hotel management and licensing of our portfolio of brands to franchisees located in the United States, Latin America, Canada and the Caribbean. This segment’s revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin. These costs relate primarily to payroll costs at managed properties where the Company is the employer. These revenues and costs are recorded within other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees collected from the Company’s owned hotels, which are eliminated in consolidation.
ASPAC management and franchising—This segment derives its earnings primarily from a combination of hotel management and licensing of our portfolio of brands to franchisees located in Southeast Asia, as well as Greater China, Australia, South Korea, Japan and Micronesia. This segment’s revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin. These costs relate primarily to reservations, marketing and technology costs. These revenues and costs are recorded within other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees collected from the Company’s owned hotels, which are eliminated in consolidation.
EAME/SW Asia management and franchising—This segment derives its earnings primarily from a combination of hotel management and licensing of our portfolio of brands to franchisees located primarily in Europe, Africa, the Middle East, India, Central Asia and Nepal. This segment’s revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin. These costs relate primarily to reservations, marketing and technology costs. These revenues and costs are recorded within other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees collected from the Company’s owned hotels, which are eliminated in consolidation.
Our chief operating decision maker evaluates performance based on each segment’s revenue and Adjusted EBITDA. Adjusted EBITDA, as we define it, is a non-GAAP measure. We define Adjusted EBITDA as net income attributable to Hyatt Hotels Corporation plus our pro rata share of unconsolidated hospitality ventures Adjusted EBITDA based on our ownership percentage of each venture, adjusted to exclude interest expense; provision for income taxes; depreciation and amortization; equity earnings (losses) from unconsolidated hospitality ventures; stock-based compensation expense; gains (losses) on sales of real estate and other; asset impairments; other (income) loss, net; and net income attributable to noncontrolling interests.
Effective January 1, 2016, our definition of Adjusted EBITDA has been updated to exclude stock-based compensation expense to facilitate comparison with our competitors. We have applied this change in the definition of Adjusted EBITDA to 2015 and 2014 historical results to allow for comparability between the periods presented.
The table below shows summarized consolidated financial information by segment. Included within corporate and other are unallocated corporate expenses, license fees related to Hyatt Residence Club, our co-branded credit card and our vacation ownership business prior to the sale in the fourth quarter of 2014. 
 
Years Ended December 31,
2016
 
2015
 
2014
Owned and leased hotels
 
 
 
 
 
Owned and leased hotels revenues
$
2,119

 
$
2,079

 
$
2,246

Intersegment revenues (a)
11

 

 

Adjusted EBITDA
516

 
493

 
523

Depreciation and amortization
285

 
277

 
322

Capital expenditures
200

 
225

 
208

Americas management and franchising
 
 
 
 
 
Management and franchise fees revenues
371

 
354

 
327

Other revenues from managed properties
1,670

 
1,641

 
1,550

Intersegment revenues (a)
75

 
74

 
88

Adjusted EBITDA
318

 
300

 
265

Depreciation and amortization
18

 
19

 
18

Capital expenditures

 

 
1

ASPAC management and franchising
 
 
 
 
 
Management and franchise fees revenues
96

 
91

 
88

Other revenues from managed properties
98

 
87

 
74

Intersegment revenues (a)
2

 
2

 
2

Adjusted EBITDA
57

 
55

 
49

Depreciation and amortization
1

 
1

 
1

Capital expenditures
1

 
1

 
1

EAME/SW Asia management and franchising
 
 
 
 
 
Management and franchise fees revenues
65

 
67

 
77

Other revenues from managed properties
65

 
58

 
53

Intersegment revenues (a)
10

 
13

 
15

Adjusted EBITDA
33

 
33

 
43

Depreciation and amortization
5

 
5

 
6

Capital expenditures
1

 

 

Corporate and other
 
 
 
 
 
Revenues
43

 
40

 
75

Other revenues from managed properties

 

 
30

Adjusted EBITDA
(139
)
 
(131
)
 
(103
)
Depreciation and amortization
33

 
18

 
7

Capital expenditures
9

 
43

 
43

Eliminations (a)
 
 
 
 
 
Revenues
(98
)
 
(89
)
 
(105
)
Adjusted EBITDA

 

 

Depreciation and amortization

 

 

Capital expenditures

 

 

TOTAL
 
 
 
 
 
Revenues
$
4,429

 
$
4,328

 
$
4,415

Adjusted EBITDA
785

 
750

 
777

Depreciation and amortization
342

 
320

 
354

Capital expenditures
211

 
269

 
253

(a)
Intersegment revenues are included in the management and franchise fees revenues and owned and leased hotels revenues and eliminated in Eliminations.
The table below presents summarized consolidated balance sheet information by segment:
Total Assets
 
December 31, 2016
 
December 31, 2015
Owned and leased hotels
$
5,393

 
$
5,281

Americas management and franchising
564

 
464

ASPAC management and franchising
128

 
131

EAME/SW Asia management and franchising
186

 
234

Corporate and other
1,478

 
1,481

TOTAL
$
7,749

 
$
7,591


The following tables present revenues and property and equipment, net, intangibles, net and goodwill by geographical region: 
 
Years Ended December 31,
2016
 
2015
 
2014
Revenues:
 
 
 
 
 
United States
$
3,571

 
$
3,494

 
$
3,476

All Foreign
858

 
834

 
939

Total
$
4,429

 
$
4,328

 
$
4,415

 
 
 
 
 
 
 
December 31, 2016
 
December 31, 2015
 
 
Property and equipment, net, Intangibles, net and Goodwill:
 
 
 
 
 
United States
$
3,915

 
$
3,562

 
 
All Foreign
1,079

 
1,145

 
 
Total
$
4,994

 
$
4,707

 
 

The table below provides a reconciliation of our net income attributable to Hyatt Hotels Corporation to EBITDA and a reconciliation of EBITDA to our consolidated Adjusted EBITDA
 
Years Ended December 31,
2016
 
2015
 
2014
Net income attributable to Hyatt Hotels Corporation
$
204

 
$
124

 
$
344

Interest expense
76

 
68

 
71

Provision for income taxes
85

 
70

 
179

Depreciation and amortization
342

 
320

 
354

EBITDA
707

 
582

 
948

Equity (earnings) losses from unconsolidated hospitality ventures
(68
)
 
64

 
(25
)
Stock-based compensation expense
25

 
23

 
49

(Gains) losses on sales of real estate and other
23

 
(9
)
 
(311
)
Asset impairments

 
5

 
17

Other (income) loss, net
(2
)
 
5

 
17

Net income attributable to noncontrolling interests

 

 
2

Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA
100

 
80

 
80

Adjusted EBITDA
$
785

 
$
750

 
$
777

Earnings Per Share
Earnings Per Share
EARNINGS PER SHARE
The calculation of basic and diluted earnings per share, including a reconciliation of the numerator and denominator, are as follows: 
 
Years Ended December 31,
2016
 
2015
 
2014
Numerator:
 
 
 
 
 
Net income
$
204

 
$
124

 
$
346

Net (income) loss attributable to noncontrolling interests

 

 
(2
)
Net income attributable to Hyatt Hotels Corporation
$
204

 
$
124

 
$
344

Denominator:
 
 
 
 
 
Basic weighted average shares outstanding
132,930,578

 
142,814,868

 
153,136,511

Share-based compensation
1,008,753

 
1,184,455

 
1,213,941

Diluted weighted average shares outstanding
133,939,331

 
143,999,323

 
154,350,452

Basic Earnings Per Share:
 
 
 
 
 
Net income
$
1.53

 
$
0.87

 
$
2.26

Net (income) loss attributable to noncontrolling interests

 

 
(0.01
)
Net income attributable to Hyatt Hotels Corporation
$
1.53

 
$
0.87

 
$
2.25

Diluted Earnings Per Share:
 
 
 
 
 
Net income
$
1.52

 
$
0.86

 
$
2.24

Net (income) loss attributable to noncontrolling interests

 

 
(0.01
)
Net income attributable to Hyatt Hotels Corporation
$
1.52

 
$
0.86

 
$
2.23


The computations of diluted net income per share for the years ended December 31, 2016, December 31, 2015 and December 31, 2014 do not include the following shares of Class A common stock assumed to be issued as stock-settled SARs and RSUs because they are anti-dilutive.
 
Years Ended December 31,
 
2016
 
2015
 
2014
SARs
74,500

 
1,500

 
5,200

RSUs
900

 



Other Income (Loss), Net
Other Income (Loss), Net
OTHER INCOME (LOSS), NET
 
For the years ended December 31,
2016
 
2015
 
2014
Performance guarantee liability amortization (Note 14)
34

 
12

 
7

Depreciation recovery
25

 
12

 
2

Interest income
19

 
8

 
11

Foreign currency gains (losses), net
1

 
(14
)
 
(3
)
Realized losses (Note 4)
(6
)
 

 

Performance guarantee expense, net (Note 14)
(63
)
 
(27
)
 
(23
)
Other
(8
)
 
4

 
(11
)
Other income (loss), net
$
2

 
$
(5
)
 
$
(17
)
Subsequent Event
Subsequent Events
SUBSEQUENT EVENT
On January 17, 2017, we acquired Miraval Group from an unrelated third party for approximately $215 million. The transaction included the Miraval Life in Balance Spa brand, Miraval Arizona Resort & Spa, the Travaasa Resort and the option to acquire the Cranwell Spa & Golf Resort. On January 26, 2017, we acquired the Cranwell Spa & Golf Resort for approximately $20 million.
Quarterly Financial Information (Unaudited)
Quarterly Financial Information (Unaudited)
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
The following table sets forth the historical unaudited quarterly financial data. The information for each of these periods has been prepared on the same basis as the audited consolidated financial statements and, in our opinion, reflects all adjustments necessary to present fairly our financial results. Operating results for previous periods do not necessarily indicate results that may be achieved in any future period.
 
For the three months ended
December 31, 2016
 
September 30, 2016
 
June 30, 2016
 
March 31, 2016
 
December 31, 2015
 
September 30, 2015
 
June 30, 2015
 
March 31, 2015
Consolidated statements of income data:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owned and leased hotels
$
514

 
$
519

 
$
559

 
$
516

 
$
530

 
$
500

 
$
540

 
$
509

Management and franchise fees
116

 
110

 
115

 
107

 
107

 
103

 
112

 
105

Other revenues
9

 
11

 
11

 
9

 
10

 
10

 
9

 
7

Other revenues from managed properties
448

 
448

 
480

 
457

 
462

 
440

 
451

 
433

Total revenues
1,087

 
1,088

 
1,165

 
1,089

 
1,109

 
1,053

 
1,112

 
1,054

Direct and selling, general, and administrative expenses
1,027

 
1,019

 
1,063

 
1,021

 
1,047

 
965

 
998

 
995

Net income
41

 
62

 
67

 
34

 
37

 
25

 
40

 
22

Net income attributable to Hyatt Hotels Corporation
41

 
62

 
67

 
34

 
37

 
25

 
40

 
22

Net income per common share, basic
$
0.31

 
$
0.48

 
$
0.50

 
$
0.25

 
$
0.26

 
$
0.18

 
$
0.28

 
$
0.15

Net income per common share, diluted
$
0.31

 
$
0.47

 
$
0.49

 
$
0.25

 
$
0.26

 
$
0.18

 
$
0.27

 
$
0.15

Valuation and Qualifying Accounts
Schedule II - Valuation and Qualifying Accounts
SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS
For the Years Ended December 31, 2016, December 31, 2015, and December 31, 2014
(In millions of dollars)
 
 
Column A
 
Column B
 
Column C
 
Column D
 
Column E
Description
 
Balance at Beginning of Period
 
Additions Charged to Revenues, Costs and Expenses
 
Additions Charged to Other Accounts
 
Deductions
 
Balance at End of Period
Year Ended December 31, 2016:
 
 
 
 
 
 
 
 
 
 
Trade receivables—allowance for doubtful accounts
 
$
15

 
$
6

 
$

 
$
(3
)
 
$
18

Financing receivables—allowance for losses
 
98

 
10

 

 
(8
)
 
100

Deferred tax assets—valuation allowance
 
17

 
10

 

 

 
27

Year Ended December 31, 2015:
 
 
 
 
 
 
 
 
 
 
Trade receivables—allowance for doubtful accounts
 
13

 
5

 

 
(3
)
 
15

Financing receivables—allowance for losses
 
100

 
10

 
(2
)
A
(10
)
 
98

Deferred tax assets—valuation allowance
 
15

 
2

 

 

 
17

Year Ended December 31, 2014:
 
 
 
 
 
 
 
 
 
 
Trade receivables—allowance for doubtful accounts
 
11

 
5

 

 
(3
)
 
13

Financing receivables—allowance for losses
 
103

 
7

 
(9
)
A, C
(1
)
 
100

Deferred tax assets—valuation allowance
 
21

 

 

 
(6
)
B
15


A—This amount represents currency translation on foreign currency denominated notes receivable.
B—This amount represents the release of certain foreign net operating losses.
C—This amount includes removal of the allowance recorded in connection with the sale of our vacation ownership business.
Summary of Significant Accounting Policies (Policies)
Principles of Consolidation—The consolidated financial statements present the results of operations, financial position, and cash flows of Hyatt Hotels Corporation and its majority owned and controlled subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
Use of Estimates—We are required to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying Notes. Actual results could differ materially from such estimated amounts.
Revenue Recognition—Our revenues are primarily derived from the following sources and are generally recognized when services have been rendered:
Owned and leased hotels revenues are derived from room rentals and services provided at our owned and leased properties and are recorded when rooms are occupied and services have been rendered. Sales and occupancy taxes are recorded on a net basis in the consolidated statements of income.
Management and franchise fees earned from hotels managed and franchised worldwide:
Management fees primarily consist of a base fee, which is generally computed as a percentage of gross revenues, and an incentive fee, which is generally computed based on a hotel profitability measure. Base fee revenues are recognized when earned in accordance with the terms of the contract. We recognize incentive fees that would be due as if the contract were to terminate at that date, exclusive of any termination fees payable or receivable by us.
Realized gains from the sale of hotel real estate assets where we maintain substantial continuing involvement in the form of a long-term management contract are deferred and recognized as management fee revenue over the term of the underlying management contract.
Franchise fees consist of an initial application fee and continuing royalty fees calculated based on a percentage of gross room revenues and in certain circumstances, food and beverage revenues and are recognized as the fees are earned and become due from the franchisee and when all material services or conditions relating to the sale have been substantially performed or satisfied by the franchisor.
Other revenues:
Other revenues include revenues from our co-branded credit card. We recognize revenue from our co-branded credit card upon: (1) the sale of points to our third-party partner and (2) the fulfillment or expiration of a card member's promotional awards. We receive fees from our third-party partner upon activation of each credit card once the card member reaches a specified level of spend, which we defer until the associated promotional nights awarded are redeemed or expired.
Other revenues also include revenues from our vacation ownership business, earned through the date of the sale of the business in the fourth quarter of 2014. Prior to the sale, we recognized vacation ownership revenue when a minimum of 10% of the purchase price for the interval had been received, the period of cancellation with refund had expired, and receivables were deemed collectible. For sales that did not qualify for full revenue recognition, as the project had progressed beyond the preliminary stages, but had not yet reached completion, all revenue and associated direct expenses were initially deferred and recognized in earnings through the percentage-of-completion method. In periods subsequent to the sale of the business, we earn license fees that are recorded to management and franchise fees on our consolidated statements of income.
Other revenues from managed properties represent the reimbursement of costs incurred on behalf of the owners of hotel properties we manage. These costs relate primarily to payroll costs at managed properties where we are the employer, as well as reservations, marketing and technology costs. Since the reimbursements are made based upon the costs incurred with no added margin, these revenues and corresponding expenses have no effect on our net income.
Cash Equivalents—We consider all highly liquid investments purchased with an original maturity of three months or less at the date of purchase to be cash equivalents.
Restricted Cash—We had restricted cash of $76 million and $96 million at December 31, 2016 and December 31, 2015, respectively, which includes:
$40 million and $70 million, respectively, related to sales proceeds from the 2014 dispositions of two Canadian hotels, as the Canadian tax regulations require a portion of the proceeds be classified as restricted until completion of regulatory review (see Note 7);
$14 million and $13 million, respectively, related to debt service on bonds acquired in connection with the acquisition of the entity that owned Grand Hyatt San Antonio (see Note 9); in addition, we have $11 million and $10 million, respectively, recorded in other assets; and
$9 million and $7 million, respectively, related to our captive insurance subsidiary for minimum capital and surplus requirements in accordance with local insurance regulations (see Note 14).
The remaining restricted cash balances of $13 million and $6 million at December 31, 2016 and December 31, 2015, respectively, relate to escrow deposits on construction projects and other arrangements. These amounts are invested in interest-bearing accounts.
Investments—We have investments in unconsolidated hospitality ventures recorded under the equity and cost methods. These investments are an integral part of our business and are strategically and operationally important to our overall results. We assess investments in unconsolidated hospitality ventures for impairment quarterly. When there is indication a loss in value has occurred, we evaluate the carrying value in comparison to the estimated fair value of the investment. Fair value is based upon internally developed discounted cash flow models, third-party appraisals, and if appropriate, current estimated net sales proceeds from pending offers. The principal factors used in the discounted cash flow analysis requiring judgment are the projected future cash flows, the discount rates and the capitalization rate assumptions. Our estimates of projected future cash flows are based on historical data, various internal estimates and a variety of external sources, and are developed as part of our routine, long-term planning process. If the estimated fair value is less than carrying value, we use our judgment to determine if the decline in value is other than temporary. In determining this, we consider factors including, but not limited to, the length of time and extent of the decline, loss of value as a percentage of the cost, financial condition and near-term financial projections, our intent and ability to recover the lost value and current economic conditions. Impairments deemed other than temporary are charged to equity earnings (losses) from unconsolidated hospitality ventures or other income (loss), net on our consolidated statements of income.
Marketable Securities—Our investments in marketable securities consist of various types of mutual funds, preferred shares, time deposits, common stock and fixed income securities, including U.S. government obligations, obligations of other government agencies, corporate debt, mortgage-backed and asset-backed securities and municipal and provincial notes and bonds and are classified as either trading, AFS or held-to-maturity ("HTM").
Trading securities—recorded at fair value based on listed market prices or dealer price quotations where available. Realized gains and losses on trading securities are reflected in net gains and interest income from marketable securities held to fund operating programs on our consolidated statements of income.
AFS securities—recorded at fair value as described in Note 4. Unrealized gains and losses on AFS securities are reported as part of accumulated other comprehensive loss on the consolidated balance sheets. Realized gains and losses on AFS securities are recognized in other income (loss), net on our consolidated statements of income.
HTM securities—debt security investments which we have the ability to hold until maturity and are recorded at amortized cost.
AFS and HTM securities are assessed for impairment quarterly. To determine if an impairment is other than temporary, we consider the duration and severity of the loss position, the strength of the underlying collateral, the term to maturity, credit rating and our intent to sell. For debt securities that are deemed other than temporarily impaired and there is no intent to sell, impairments are separated into the amount related to the credit loss, which is typically recorded in other income (loss), net on our consolidated statements of income and the amount related to all other factors, which is recorded in accumulated other comprehensive loss on our consolidated balance sheets. For debt securities that are deemed other than temporarily impaired and there is intent to sell, impairments in their entirety are recorded on our consolidated statements of income.
Foreign Currency—The functional currency of our consolidated entities located outside the United States of America is generally the local currency. The assets and liabilities of these entities are translated into U.S. dollars at year-end exchange rates, and the related gains and losses, net of applicable deferred income taxes, are reflected in accumulated other comprehensive loss on the consolidated balance sheets. Gains and losses from foreign currency transactions are included in earnings. Gains and losses from foreign exchange rate changes related to intercompany receivables and payables of a long-term nature are generally included in accumulated other comprehensive loss. Gains and losses from foreign exchange rate movement related to intercompany receivables and payables that are not long-term are included in earnings.
Financing Receivables—Financing arrangements represent contractual rights to receive money either on demand or on fixed or determinable dates and are recognized on our consolidated balance sheets at amortized cost in current and long-term receivables. We recognize interest income as earned and provide an allowance for cancellations and defaults. Our financing receivables are composed of individual unsecured loans and other types of unsecured financing arrangements provided to hotel owners. These financing receivables have stated maturities and interest rates, however, the repayment terms vary and may be dependent upon future cash flows of the hotel.
We individually assess all loans within financing receivables for impairment quarterly. This assessment is based on an analysis of several factors including current economic conditions and industry trends, as well as the specific risk characteristics of these loans including capital structure, loan performance, market factors, and the underlying hotel performance.
On an ongoing basis, we monitor the credit quality of our financing receivables based on payment activity. We determine our financing to hotel owners to be non-performing if interest or principal is greater than 90 days past due based on the contractual terms of the individual financing receivables, if an impairment charge is recorded for a loan, or if a provision is established for our other financing arrangements.
If we consider a financing receivable to be non-performing, we place the financing receivable on non-accrual status.
When it is probable that we will be unable to collect all amounts due in accordance with the contractual terms of the individual loan agreement or if projected future cash flows available for repayment of unsecured receivables indicate there is a collection risk, we measure the impairment based on the present value of projected future cash flows discounted at the loan’s effective interest rate. For impaired loans, we establish a specific loan loss reserve for the difference between the recorded investment in the loan and the estimated fair value.
In addition to loans, we include other types of financing arrangements in unsecured financing to hotel owners which we do not assess individually for impairment. We regularly evaluate our reserves for these other financing arrangements.
We write off financing to hotel owners when we determine the receivables are uncollectible and when all commercially reasonable means of recovering the receivable balances have been exhausted.
We recognize interest income when received for impaired loans and financing receivables on non-accrual status which is recorded to other income (loss), net in the accompanying consolidated statements of income. Accrual of interest income is resumed when the receivable becomes contractually current and collection doubts are removed.
Accounts Receivable—Our accounts receivable primarily consist of trade receivables due from guests for services rendered at our owned and leased properties and from hotel owners with whom we have management and franchise agreements for services rendered and for reimbursements of costs incurred on behalf of managed and franchised properties. We record an accounts receivable reserve when losses are probable, based on an assessment of past collection activity and current business conditions.
Inventories—Inventories are comprised of operating supplies and equipment that have a period of consumption of two years or less, and food and beverage items at our owned and leased hotels which are generally valued at the lower of cost (first-in, first-out) or market. Inventories also include residential inventories, which include two building structures containing luxury villas and the associated land. Inventories are carried at the lower of cost or net realizable value.
Property and Equipment and Definite-Lived Intangibles—Property and equipment and definite-lived intangibles are stated at cost, including interest incurred during development and construction periods, less accumulated depreciation and amortization. Depreciation and amortization are recognized over the estimated useful lives of the assets, primarily on the straight-line method.
Useful lives assigned to property and equipment are as follows:
Buildings and improvements
10-50 years
Leasehold improvements
The shorter of the lease term or useful life of asset
Furniture and equipment
3-20 years
Computers
3-7 years

Useful lives assigned to definite-lived intangibles are as follows:
Management and franchise agreement intangibles
Initial term of management or franchise agreement
Lease related intangibles
Lease term
Advanced booking intangibles
Period of the advanced bookings

We assess property and equipment and definite-lived intangibles for impairment quarterly. When events or circumstances indicate the carrying amount may not be recoverable, we evaluate the net book value of the assets for impairment by comparison to the projected undiscounted future cash flows of the assets. The principal factor used in the undiscounted cash flow analysis requiring judgment is the projected future operating cash flows, which are based on historical data, various internal estimates and a variety of external resources, and are developed as part of our routine, long-term planning process.
If the projected undiscounted future cash flows are less than the net book value of the assets, the fair value is determined based upon internally developed discounted cash flows of the assets, third-party appraisals, and if appropriate, current estimated net sales proceeds from pending offers. The principal factors used in the discounted cash flow analysis requiring judgment are the projected future cash flows, the discount rates and the capitalization rate assumptions. The excess of the net book value over the estimated fair value is charged to asset impairments within our consolidated statements of income.
We evaluate the carrying value of our property and equipment and definite-lived intangibles based on our plans, at the time, for such assets and consider qualitative factors such as future development in the surrounding area, status of local competition and any significant adverse changes in the business climate. Changes to our plans, including a decision to dispose of or change the intended use of an asset, may have a material impact on the carrying value of the asset.
Acquisitions—Assets acquired and liabilities assumed in business combinations are recorded on our consolidated balance sheets as of the respective acquisition dates based upon their estimated fair values, see Note 7. The results of operations of businesses acquired by us have been included in the consolidated statements of income since their respective dates of acquisition. In certain circumstances, the purchase price allocations are based upon preliminary estimates and assumptions. Accordingly, the allocations are subject to revision when we receive final information, including appraisals and other analyses.
Under the supervision of management, independent third-party valuation specialists estimate the fair value of our properties acquired using various recognized valuation methods including the income approach, the cost approach, and the sales comparison approach, which are primarily based on Level Three assumptions. Assumptions utilized in determining the fair value under these approaches include, but are not limited to, historical financial results when applicable, projected cash flows, discount rates, capitalization rates, current market conditions and comparable transactions. The fair value is then allocated to tangible and intangibles assets with any remaining value assigned to goodwill, if applicable. Various assumptions are used when determining the value to allocate to each identifiable asset, including, discount rates, royalty rates, timing of future cash flows and a variety of external sources. When we acquire the remaining ownership interest in or the property from an unconsolidated hospitality venture in a step acquisition, we estimate the fair value of our equity interest using the assumed cash proceeds we would receive from sale to a third party at a market sales price, which is determined using the aforementioned fair value methodologies and assumptions.
Guarantees—We enter into performance guarantees related to certain hotels we manage. We also enter into debt repayment guarantees with respect to certain hotels we manage or franchise, typically in which we also hold an equity investment. We record a liability for the fair value of these performance and debt repayment guarantees at their inception date. In order to estimate fair value we use a Monte Carlo simulation to model the probability of possible outcomes. The valuation methodology requires that we make certain assumptions and judgments regarding: discount rates, volatility, hotel operating results and hotel property sales prices. The fair value is not re-valued due to future changes in assumptions. The corresponding offset depends on the circumstances in which the guarantee was issued and is recorded to investments, intangibles or expense. We amortize the liability for the fair value of a guarantee into income over the term of the guarantee using a systematic and rational, risk-based approach. Performance guarantees and debt repayment guarantees related to our managed or franchised hotels are amortized into income in other income (loss), net in the consolidated statements of income and debt repayment guarantees that relate to our unconsolidated hospitality ventures are amortized into equity earnings (losses) from unconsolidated hospitality ventures in the consolidated statements of income. On a quarterly basis, we evaluate the likelihood of funding under a guarantee. To the extent we determine an obligation to fund under a guarantee is both probable and estimable based upon performance during the period, we record a separate contingent liability in other income (loss), net or equity earnings (losses) from unconsolidated hospitality ventures.
Goodwill—Goodwill represents the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. As required, we evaluate goodwill for impairment on an annual basis, and do so during the fourth quarter of each year using balances as of October 1 and at an interim date if indications of impairment exist. Goodwill impairment is determined by comparing the fair value of a reporting unit to its carrying amount. This is done either by performing a qualitative assessment or proceeding to the two-step process, with an impairment being recognized only where the fair value of the reporting unit is less than its carrying value. In any given year we can elect to perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is in excess of its carrying value. If it is not more likely than not that the fair value is in excess of the carrying value, or we elect to bypass the qualitative assessment, we proceed to the two-step process.
When determining fair value, we utilize internally developed discounted future cash flow models, third-party appraisals and, if appropriate, current estimated net sales proceeds from pending offers. Under the discounted cash flow approach we utilize various assumptions requiring judgment, including projected future cash flows, discount rates and capitalization rates. Our estimates of projected future cash flows are based on historical data, various internal estimates and a variety of external sources, and are developed as part of our routine, long-term planning process. We then compare the estimated fair value to our carrying value. If the carrying value is in excess of the fair value, we must determine our implied fair value of goodwill to measure if any impairment charge is necessary. The determination of our implied fair value of goodwill requires the allocation of the reporting unit’s estimated fair value to the individual assets and liabilities of the reporting unit as if we had completed a business combination. We perform the allocation based on our knowledge of the reporting unit, the market in which they operate, and our overall knowledge of the hospitality industry. Changes in our allocation approach could result in different measures of implied fair value and impact the final impairment charge, if any. The excess of the carrying value over the implied fair value is recorded to asset impairments within our consolidated statements of income.
Income Taxes—We account for income taxes to recognize the amount of taxes payable or refundable for the current year and the amount of deferred tax assets and liabilities resulting from the future tax consequences of differences between the financial statements and tax basis of the respective assets and liabilities. We recognize the financial statement effect of a tax position when, based on the technical merits of the uncertain tax position, it is more likely than not to be sustained on a review by taxing authorities. These estimates are based on judgments made with currently available information. We review these estimates and make changes to recorded amounts of uncertain tax positions as facts and circumstances warrant.
Fair Value—We apply the provisions of fair value measurement to various financial instruments, which we measure at fair value on a recurring basis, and to various financial and nonfinancial assets and liabilities, which we measure at fair value on a nonrecurring basis. We disclose the fair value of our financial assets and liabilities based on observable market information where available, or on market participant assumptions. These assumptions are subjective in nature, involve matters of judgment, and, therefore, fair values cannot always be determined with precision. When determining fair value, we maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of the hierarchy are as follows:
Level One—Fair values based on unadjusted quoted prices in active markets for identical assets and liabilities;
Level Two—Fair values based on quoted market prices for similar assets and liabilities in active markets, quoted prices in inactive markets for identical assets and liabilities, and inputs other than quoted market prices that are observable for the asset or liability; and
Level Three—Fair values based on inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. Valuation techniques could include the use of discounted cash flow models and similar techniques.
We typically utilize the market approach and income approach for valuing our financial instruments. The market approach utilizes prices and information generated by market transactions involving identical or similar assets and liabilities and the income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted). For instances in which the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of fair value assets and liabilities within the fair value hierarchy.
The carrying values of cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term nature of these items and their close proximity to maturity.
Stock-Based Compensation—As part of our LTIP, we award SARs, RSUs, PSs and PSUs to certain employees and directors:
SARs—Each vested SAR gives the holder the right to the difference between the value of one share of our Class A common stock at the exercise date and the value of one share of our Class A common stock at the grant date. Vested SARs can be exercised over their life as determined in accordance with the LTIP. All SARs have a 10-year contractual term, are settled in shares of our Class A common stock and are accounted for as equity instruments.
We record the compensation expense for SARs on a straight-line basis from the date of grant. The exercise price of these SARs is the fair value of our common stock at the grant date, based on a valuation of the Company prior to the IPO, or the closing share price on the date of grant (as applicable).
RSUs—Each vested RSU will be settled by delivery of a single share of our Class A common stock with the exception of insignificant portions of the March 2016, March 2015, February 2014, March 2013, and June 2013 awards which will be settled in cash. The value of the RSUs is based upon the fair value of our common stock at the grant date, based upon a valuation of the Company prior to IPO, or the closing stock price of our Class A common stock for the December 2009 award and all subsequent awards. Awards issued prior to our November 2009 IPO are deferred in nature and will be settled once all tranches of the award have fully vested or otherwise as provided in the relevant agreements, while all awards issued in December 2009 and later will be settled as each individual tranche vests under the relevant agreements.
We record compensation expense over the requisite service period of the individual grantee. In certain situations we also grant cash-settled RSUs which are recorded as a liability instrument.
PSs—The Company has granted PSs to certain executive officers. The number of PSs that will ultimately vest with no further restrictions on transfer depends upon the performance of the Company at the end of the applicable three year performance period relative to the applicable performance target. The PSs vest in full if the maximum performance metric is achieved, and generally subject to continued employment through the applicable performance period. At the end of the performance period, the PSs that do not vest will be forfeited. The PSs will vest at the end of the performance period only if the performance threshold is met and continued service requirements are satisfied; there is no interim performance metric except in the case of certain change in control transactions.
PSUs—The Company has granted PSUs to certain executive officers. PSUs vest and are settled in Class A common stock based upon the performance of the Company through the end of the applicable three year performance period relative to the applicable performance target, and generally subject to continued employment through the applicable performance period. The PSUs will vest at the end of the performance period only if the performance threshold is met and continued service requirements are satisfied; there is no interim performance metric except in the case of certain change in control transactions.
Hyatt Gold Passport—We operate the Program through the Hyatt Gold Passport Fund (the "Fund") for the benefit of the Hyatt portfolio of properties owned, operated, managed, licensed or franchised by us during the period of their participation in the Program. The Fund has been established to provide for the payment of operating expenses and redemption of member awards associated with the Program.
We charge the cost of operating the Program, including the estimated cost of award redemption, to the properties based on members’ qualified expenditures. Due to the requirements under the Program that the properties reimburse us for the Program’s operating costs, we recognize this revenue from properties at the time such costs are incurred and expensed. We defer revenue received from the properties equal to the actuarially determined estimate of our future redemption obligation. Upon the redemption of points, we recognize the previously deferred revenue and recognize the corresponding expense relating to the cost of the awards redeemed. Revenue is recognized by the properties when the points are redeemed, and expenses are recognized when the points are earned by the members.
We actuarially determine the estimate of the future redemption obligation based on statistical formulas that project the timing of future point redemption based on historical experience, including an estimate of the breakage for points that will never be redeemed, and an estimate of the points that will eventually be redeemed. Actual expenditures for the Program may differ from the actuarially determined liability.
The Fund is financed by payments from the properties and returns on marketable securities. The Fund invests amounts received from the properties in marketable securities which are included in other current and noncurrent assets (see Note 4). The noncurrent liabilities of the Fund are included in other long-term liabilities (see Note 12).
Recently Issued Accounting Pronouncements
Adopted Accounting Standards
In April 2015, the Financial Accounting Standards Board ("FASB") released ASU 2015-03, which requires debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. The provisions of ASU 2015-03 are effective for interim periods and fiscal years beginning after December 15, 2015. We adopted the standard on January 1, 2016, and as a result we reclassified $5 million of debt issuance costs previously included in other assets to long-term debt on our consolidated balance sheets as of December 31, 2015.
Future Adoption of Accounting Standards
In May 2014, the FASB released ASU 2014-09, which supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and provides a single, comprehensive revenue recognition model for contracts with customers. In August 2015, the FASB released Accounting Standards Update No. 2015-14 ("ASU 2015-14"), Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. ASU 2015-14 delays the effective date of ASU 2014-09 by one year, making it effective for interim periods and fiscal years beginning after December 15, 2017, with early adoption permitted as of the original effective date under ASU 2014-09.
The standard permits the use of either the retrospective or modified retrospective (cumulative effect) transition method and we have not yet selected which transition method we will apply. While we continue to evaluate possible impacts on our consolidated financial statements, ASU 2014-09 is expected to impact either the amount or timing of revenue recognition as follows:
Under existing guidance, gains on sales of real estate when we maintain substantial continuing involvement are deferred and amortized into management and franchise fee revenues. Upon adoption of ASU 2014-09, gains on sales of real estate assets will be recognized when control of the property transfers to the buyer. We expect any remaining unamortized deferred gains as of our date of adoption will be included as an adjustment to equity. For the year ended December 31, 2016, Hyatt recognized $21 million of management fee revenue related to the amortization of deferred gains.
Under existing guidance, amortization of management and franchise agreement intangibles is recorded within depreciation and amortization on our consolidated statements of income. Upon adoption of ASU 2014-09, management and franchise agreement intangibles may meet the definition of consideration paid to a customer and therefore, could be recorded as contra-revenue within management and franchise fees on our consolidated statements of income.
Under existing guidance, incentive fees are recognized in the amount that would be due as if the contract were to terminate at that date. Under ASU 2014-09, variable consideration is included in the transaction price only if it is probable that a significant reversal in the cumulative amount of revenue recognized would not occur when the uncertainty associated with the variable consideration is subsequently resolved. This may result in a different pattern of recognition for incentive fees for certain contracts.
Under existing guidance, franchise application fees are recognized at a point in time. Upon adoption of ASU 2014-09, initial franchise application fees will be recognized over time.
We do not expect the standard to materially affect the amount or timing of revenue recognition for royalty fees from our franchised properties or base management fees from our managed properties. We are continuing to evaluate other possible impacts to our consolidated financial statements, including the impact related to Hyatt Gold Passport.
In January 2016, the FASB released Accounting Standards Update No. 2016-01 ("ASU 2016-01"), Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 revises the accounting for equity investments and financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. The provisions of ASU 2016-01 are effective for interim periods and fiscal years beginning after December 15, 2017. We are currently evaluating the impact of adopting ASU 2016-01.
In February 2016, the FASB released Accounting Standards Update No. 2016-02 ("ASU 2016-02"), Leases (Topic 842). ASU 2016-02 requires lessees to record lease contracts on the balance sheet by recognizing a right-of-use asset and lease liability. The provisions of ASU 2016-02 are effective for interim periods and fiscal years beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact of adopting ASU 2016-02.
In June 2016, the FASB released Accounting Standards Update No. 2016-13 ("ASU 2016-13"), Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaces the existing impairment model for most financial assets from an incurred loss impairment model to a current expected credit loss model, which requires an entity to recognize an impairment allowance equal to its current estimate of all contractual cash flows the entity does not expect to collect. ASU 2016-13 also requires credit losses relating to AFS debt securities to be recorded through an allowance for credit losses. The provisions of ASU 2016-13 are effective for interim periods and fiscal years beginning after December 15, 2019, with early adoption permitted. We are currently evaluating the impact of adopting ASU 2016-13.
In October 2016, the FASB released Accounting Standards Update No. 2016-16 ("ASU 2016-16"), Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. ASU 2016-16 requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The provisions of ASU 2016-16 are effective for interim periods and fiscal years beginning after December 15, 2017, with early adoption permitted. We are currently evaluating the impact of adopting ASU 2016-16.
Defined Contribution Plans—We provide retirement benefits to certain eligible employees under the Retirement Savings Plan (a qualified plan under Internal Revenue Code Section 401(k)), the FRP, and other similar plans. For the years ended December 31, 2016, December 31, 2015, and December 31, 2014, we recorded expenses of $36 million, $35 million, and $35 million, respectively, related to the Retirement Savings Plan based on a percentage of eligible employee contributions on stipulated amounts. The majority of these contributions relate to hotel property level employees, which are reimbursable to us and are included in the other revenues from managed properties and other costs from managed properties on our consolidated statements of income.
Deferred Compensation Plans—We provide nonqualified deferred compensation for certain employees through the DCP. Contributions and investment elections are determined by the employees, and the Company provides contributions to certain eligible employees according to pre-established formulas.
Defined Benefit Plans—We sponsor supplemental executive retirement plans consisting of funded and unfunded defined benefit plans for certain former executives. Retirement benefits are based primarily on the former employees’ salary, as defined, and are payable upon satisfaction of certain service and age requirements as defined by the plans.
Employee Stock Purchase Program—We provide the Hyatt Hotels Corporation ESPP, which qualifies under Section 423 of the Internal Revenue Code. The ESPP provides eligible employees the opportunity to purchase shares of the Company’s common stock on a quarterly basis through payroll deductions at a price equal to 95% of the fair value on the last trading day of each quarter.
We act as general partner of various partnerships owning hotel properties that are subject to mortgage indebtedness. These mortgage agreements generally limit the lender’s recourse to security interests in assets financed and/or other assets of the partnership(s) and/or the general partner(s) thereof.
In conjunction with financing obtained for our unconsolidated hospitality ventures and certain managed hotels, we may provide standard indemnifications to the lender for loss, liability or damage occurring as a result of our actions or actions of the other unconsolidated hospitality venture owners.
We are subject, from time to time, to various claims and contingencies related to lawsuits, taxes, and environmental matters, as well as commitments under contractual obligations. Many of these claims are covered under the current insurance programs, subject to deductibles. We recognize a liability associated with commitments and contingencies when a loss is probable and reasonably estimable. Although the ultimate liability for these matters cannot be determined at this point, based on information currently available, we do not expect the ultimate resolution of such claims and litigation will have a material effect on our consolidated financial statements.
We obtain commercial insurance for potential losses for general liability, workers' compensation, automobile liability, employment practices, crime, property and other miscellaneous coverages. A portion of the risk is retained on a self insurance basis primarily through U.S. based and licensed captive insurance companies that are wholly owned subsidiaries of Hyatt and that generally insure our deductibles and retentions. Reserve requirements are established based on actuarial projections of ultimate losses.
Our reportable segments are components of the business which are managed discretely and for which discrete financial information is reviewed regularly by the chief operating decision maker to assess performance and make decisions regarding the allocation of resources. Our chief operating decision maker is the President and Chief Executive Officer. We define our reportable segments as follows:
Owned and leased hotels—This segment derives its earnings from owned and leased hotel properties located predominantly in the United States, but also in certain international locations and for purposes of segment Adjusted EBITDA, includes our pro rata share of the Adjusted EBITDA of our unconsolidated hospitality ventures, based on our ownership percentage of each venture. Adjusted EBITDA includes intercompany expenses related to management fees paid to the Company's management and franchising segments, which are eliminated in consolidation. Intersegment revenues relate to promotional award redemptions earned by our owned and leased hotels related to our co-branded credit card, which are eliminated in consolidation.
Americas management and franchising—This segment derives its earnings primarily from a combination of hotel management and licensing of our portfolio of brands to franchisees located in the United States, Latin America, Canada and the Caribbean. This segment’s revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin. These costs relate primarily to payroll costs at managed properties where the Company is the employer. These revenues and costs are recorded within other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees collected from the Company’s owned hotels, which are eliminated in consolidation.
ASPAC management and franchising—This segment derives its earnings primarily from a combination of hotel management and licensing of our portfolio of brands to franchisees located in Southeast Asia, as well as Greater China, Australia, South Korea, Japan and Micronesia. This segment’s revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin. These costs relate primarily to reservations, marketing and technology costs. These revenues and costs are recorded within other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees collected from the Company’s owned hotels, which are eliminated in consolidation.
EAME/SW Asia management and franchising—This segment derives its earnings primarily from a combination of hotel management and licensing of our portfolio of brands to franchisees located primarily in Europe, Africa, the Middle East, India, Central Asia and Nepal. This segment’s revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin. These costs relate primarily to reservations, marketing and technology costs. These revenues and costs are recorded within other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees collected from the Company’s owned hotels, which are eliminated in consolidation.
Our chief operating decision maker evaluates performance based on each segment’s revenue and Adjusted EBITDA. Adjusted EBITDA, as we define it, is a non-GAAP measure. We define Adjusted EBITDA as net income attributable to Hyatt Hotels Corporation plus our pro rata share of unconsolidated hospitality ventures Adjusted EBITDA based on our ownership percentage of each venture, adjusted to exclude interest expense; provision for income taxes; depreciation and amortization; equity earnings (losses) from unconsolidated hospitality ventures; stock-based compensation expense; gains (losses) on sales of real estate and other; asset impairments; other (income) loss, net; and net income attributable to noncontrolling interests.
Effective January 1, 2016, our definition of Adjusted EBITDA has been updated to exclude stock-based compensation expense to facilitate comparison with our competitors. We have applied this change in the definition of Adjusted EBITDA to 2015 and 2014 historical results to allow for comparability between the periods presented.
Summary of Significant Accounting Policies (Tables)
Useful lives assigned to property and equipment are as follows:
Buildings and improvements
10-50 years
Leasehold improvements
The shorter of the lease term or useful life of asset
Furniture and equipment
3-20 years
Computers
3-7 years
Useful lives assigned to definite-lived intangibles are as follows:
Management and franchise agreement intangibles
Initial term of management or franchise agreement
Lease related intangibles
Lease term
Advanced booking intangibles
Period of the advanced bookings
Assets and liabilities of the Fund are as follows:
 
December 31, 2016
 
December 31, 2015
Current Assets
$
150

 
$
179

Noncurrent Assets
296

 
280

Total Assets
$
446

 
$
459

 
 
 
 
Current Liabilities
$
150

 
$
179

Noncurrent Liabilities
296

 
280

Total Liabilities
$
446

 
$
459

Equity and Cost Method Investments (Tables)
 
December 31, 2016
 
December 31, 2015
Equity method investments
$
180

 
$
304

Cost method investments
6

 
23

Total investments
$
186

 
$
327

The carrying values and ownership percentages of our unconsolidated investments in hospitality ventures accounted for under the equity method were as follows:
 
Ownership Interests
 
Investment Balance
December 31, 2016
 
December 31, 2015
Juniper Hotels Private Limited
50.0
%
 
$
37

 
$
44

Playa Hotels & Resorts B.V.
23.7
%
 
23

 
28

San Jose Hotel Partners, L.L.C.
40.0
%
 
15

 
12

Four One Five, L.L.C.
49.0
%
 
15

 
5

Rio Preto Partners SARL
70.0
%
 
14

 
7

Desarrolladora Hotel Acueducto S. de R.L. de C.V.
50.0
%
 
13

 
15

Hotel Hoyo Uno, S. de R.L. de C.V.
40.0
%
 
13

 
14

Hotel Am Belvedere GmbH & Co KG
50.0
%
 
12

 

Wailea Hotel Holdings, L.L.C. (See Note 7)
%
 

 
125

Other
 
 
38

 
54

Total
 
 
$
180

 
$
304

The following tables present summarized financial information for all unconsolidated hospitality ventures in which we hold an investment accounted for under the equity method.
 
Years Ended December 31,
2016
 
2015
 
2014
Total revenues
$
1,229

 
$
1,079

 
$
1,192

Gross operating profit
398

 
312

 
329

Income from continuing operations
160

 
33

 
31

Net income
160

 
33

 
31

 
 
December 31, 2016
 
December 31, 2015
Current Assets
$
443

 
$
472

Noncurrent Assets
2,701

 
2,877

Total Assets
$
3,144

 
$
3,349

 
 
 
 
Current Liabilities
$
385

 
$
625

Noncurrent Liabilities
2,037

 
1,752

Total Liabilities
$
2,422

 
$
2,377

Marketable Securities (Tables)
arketable securities held to fund operating programs, which are recorded at fair value and included on the consolidated balance sheets, were as follows: 
 
December 31, 2016
 
December 31, 2015
Marketable securities held by Hyatt Gold Passport Fund (Note 2)
$
394

 
$
384

Marketable securities held to fund deferred compensation plans held in rabbi trusts (Note 11)
352

 
333

Marketable securities held to fund our captive insurance companies
65

 
82

Total marketable securities held to fund operating programs
$
811

 
$
799

Less current portion of marketable securities held to fund operating programs included in cash and cash equivalents, short-term investments, and prepaids and other assets
(109
)
 
(121
)
Marketable securities held to fund operating programs included in other assets
$
702

 
$
678

Net gains and interest income from marketable securities held to fund operating programs on the consolidated statements of income included realized and unrealized gains and losses and interest income related to the following:
 
Years Ended December 31,
2016
 
2015
 
2014
Hyatt Gold Passport Fund
$
2

 
$
1

 
$
3

Deferred compensation plans held in rabbi trusts
17

 
3

 
12

Total net gains and interest income from marketable securities held to fund operating programs
$
19

 
$
4

 
$
15

arketable securities held for investment purposes, which are recorded at fair value and included on the consolidated balance sheets, were as follows: 
 
December 31, 2016
 
December 31, 2015
Interest bearing money market funds
$
106

 
$
5

Time deposits
45

 
30

Preferred shares
290

 
335

Total marketable securities held for investment purposes
$
441

 
$
370

Less current portion of marketable securities held for investment purposes included in cash and cash equivalents and short-term investments
(151
)
 
(35
)
Marketable securities held for investment purposes included in other assets
$
290

 
$
335

e measured the following financial assets at fair value on a recurring basis:
 
December 31, 2016
 
Cash and Cash Equivalents
 
Short-term Investments
 
Prepaids and Other Assets
 
Other Assets
Level One - Quoted Prices in Active Markets for Identical Assets
 
 
 
 
 
 
 
 
 
Interest bearing money market funds
$
114

 
$
114

 
$

 
$

 
$

Mutual funds
352

 

 

 

 
352

Level Two - Significant Other Observable Inputs
 
 
 
 
 
 
 
 
 
Time deposits
59

 

 
46

 

 
13

U.S. government obligations
142

 

 

 
33

 
109

U.S. government agencies
53

 

 
9

 
8

 
36

Corporate debt securities
181

 

 
1

 
35

 
145

Mortgage-backed securities
22

 

 

 
5

 
17

Asset-backed securities
34

 

 

 
8

 
26

Municipal and provincial notes and bonds
5

 

 

 
1

 
4

Level Three - Significant Unobservable Inputs
 
 
 
 
 
 
 
 
 
Preferred Shares
290

 

 

 

 
290

Total
$
1,252

 
$
114

 
$
56

 
$
90

 
$
992


 
December 31, 2015
 
Cash and Cash Equivalents
 
Short-term Investments
 
Prepaids and Other Assets
 
Other Assets
Level One - Quoted Prices in Active Markets for Identical Assets
 
 
 
 
 
 
 
 
 
Interest bearing money market funds
$
18

 
$
18

 
$

 
$

 
$

Mutual funds
333

 

 

 

 
333

Level Two - Significant Other Observable Inputs
 
 
 
 
 
 
 
 
 
Time deposits
45

 

 
38

 

 
7

U.S. government obligations
131

 

 

 
32

 
99

U.S. government agencies
83

 

 
6

 
10

 
67

Corporate debt securities
168

 

 
2

 
36

 
130

Mortgage-backed securities
26

 

 

 
6

 
20

Asset-backed securities
27

 

 

 
7

 
20

Municipal and provincial notes and bonds
3

 

 

 
1

 
2

Level Three - Significant Unobservable Inputs
 
 
 
 
 
 
 
 
 
Preferred shares
335

 

 

 

 
335

Total
$
1,169

 
$
18

 
$
46

 
$
92

 
$
1,013

The fair value of the preferred shares was: 
 
2016
 
2015
Fair value at January 1
$
335

 
$
280

Gross unrealized gains
19

 
55

Gross unrealized losses
(29
)
 

Realized losses
(6
)
 

Interest income
12

 

Cash redemption
(41
)
 

Fair value at December 31
$
290

 
$
335

The option-pricing scenarios include variations of the expected term, risk-free interest rate, volatility, and dividend yield assumptions as follows:
 
December 31, 2016
 
December 31, 2015
Expected term
1 year

 
0.75 years

Risk-free Interest Rate
0.85
%
 
0.57
%
Volatility
46.5
%
 
46.0
%
Dividend Yield
12.0
%
 
12.0
%
Significant unobservable Level Three inputs used to fair value the 2016 acquisitions include:
 
2016
Discount rate
7.25% - 9.00%
Terminal capitalization rate (1)
5.50% - 7.75%
(1) Reflects the risk profile of the individual markets where the assets are located and are not necessarily indicative of our hotel portfolio as a whole.
Property and Equipment, Net (Tables)
 
December 31, 2016
 
December 31, 2015
Land
$
901

 
$
674

Buildings
4,125

 
3,898

Leasehold improvements
202

 
220

Furniture, equipment and computers
1,316

 
1,209

Construction in progress
90

 
251

 
6,634

 
6,252

Accumulated depreciation
(2,364
)
 
(2,221
)
Total property and equipment, net
$
4,270

 
$
4,031

Depreciation expense was as follows:
 
Years Ended December 31,
2016
 
2015
 
2014
Depreciation expense
$
315

 
$
289

 
$
324

Financing Receivables (Tables)
 
December 31, 2016
 
December 31, 2015
Unsecured financing to hotel owners
119

 
120

Less allowance for losses
(100
)
 
(98
)
Less current portion included in receivables, net

 
(2
)
Total long-term financing receivables, net
$
19

 
$
20

The following tables summarize the activity in our financing receivables allowance:
 
Secured Financing
 
Unsecured Financing
 
Total
Allowance at January 1, 2016
$

 
$
98

 
$
98

   Provisions

 
10

 
10

   Write-offs

 
(8
)
 
(8
)
Allowance at December 31, 2016
$

 
$
100

 
$
100

 
Secured Financing
 
Unsecured Financing
 
Total
Allowance at January 1, 2015
$
13

 
$
87

 
$
100

   Provisions
3

 
7

 
10

   Write-offs
(1
)
 

 
(1
)
   Recoveries
(9
)
 

 
(9
)
   Other adjustments
(6
)
 
4

 
(2
)
Allowance at December 31, 2015
$

 
$
98

 
$
98

Our unsecured financing receivables were as follows:
 
December 31, 2016
 
Gross Loan Balance (Principal and Interest)
 
Related Allowance
 
Net Financing Receivables
 
Gross Receivables on Non-Accrual Status
Loans
$
13

 
$

 
$
13

 
$

Impaired loans (1)
56

 
(56
)
 

 
56

Total loans
69

 
(56
)
 
13

 
56

Other financing arrangements
50

 
(44
)
 
6

 
44

Total unsecured financing receivables
$
119

 
$
(100
)
 
$
19

 
$
100

(1) The unpaid principal balance was $43 million and the average recorded loan balance was $57 million at December 31, 2016.
 
December 31, 2015
 
Gross Loan Balance (Principal and Interest)
 
Related Allowance
 
Net Financing Receivables
 
Gross Receivables on Non-Accrual Status
Loans
$
15

 
$

 
$
15

 
$

Impaired loans (2)
58

 
(58
)
 

 
58

Total loans
73

 
(58
)
 
15

 
58

Other financing arrangements
47

 
(40
)
 
7

 
40

Total unsecured financing receivables
$
120

 
$
(98
)
 
$
22

 
$
98

(2) The unpaid principal balance was $42 million and the average recorded loan balance was $55 million at December 31, 2015.
Acquisitions and Dispositions (Tables)
The option-pricing scenarios include variations of the expected term, risk-free interest rate, volatility, and dividend yield assumptions as follows:
 
December 31, 2016
 
December 31, 2015
Expected term
1 year

 
0.75 years

Risk-free Interest Rate
0.85
%
 
0.57
%
Volatility
46.5
%
 
46.0
%
Dividend Yield
12.0
%
 
12.0
%
Significant unobservable Level Three inputs used to fair value the 2016 acquisitions include:
 
2016
Discount rate
7.25% - 9.00%
Terminal capitalization rate (1)
5.50% - 7.75%
(1) Reflects the risk profile of the individual markets where the assets are located and are not necessarily indicative of our hotel portfolio as a whole.
The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed, which are recorded in our owned and leased hotels segment at the date of acquisition:
Cash and cash equivalents
$
12

Receivables
3

Inventories
13

Prepaids and other assets
1

Property and equipment
323

Total assets
$
352

 
 
Current liabilities
10

Total liabilities
$
10

Total net assets acquired
$
342

The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed, which are recorded in our owned and leased hotels segment at the date of acquisition:
Cash and cash equivalents
$
7

Receivables
4

Inventories
1

Property and equipment
207

Goodwill
17

Intangibles
4

Deferred tax assets
1

Total assets
$
241

 
 
Current portion of long-term debt
$
4

Current liabilities
8

Long-term debt
65

Total liabilities
77

Total net assets acquired
$
164

Goodwill and Intangible Assets, Net (Tables)
 
Owned and Leased Hotels
 
Americas Management and Franchising
 
Total
Balance at January 1, 2015
 
 
 
 
 
Goodwill
$
195

 
$
33

 
$
228

Accumulated impairment losses
(95
)
 

 
(95
)
Goodwill, net
$
100

 
$
33

 
$
133

Activity during the year
 
 
 
 
 
Foreign exchange*
(4
)
 

 
(4
)
Balance at December 31, 2015
 
 
 
 
 
Goodwill
191

 
33

 
224

Accumulated impairment losses
(95
)
 

 
(95
)
Goodwill, net
$
96

 
$
33

 
$
129

Activity during the year
 
 
 
 
 
Foreign exchange*
(4
)
 

 
(4
)
Balance at December 31, 2016
 
 
 
 
 
Goodwill
187

 
33

 
220

Accumulated impairment losses
(95
)
 

 
(95
)
Goodwill, net
$
92

 
$
33

 
$
125


* Foreign exchange translation adjustments related to the goodwill associated with Hyatt Regency Mexico City.
The following is a summary of intangible assets:
 
December 31, 2016
 
Weighted Average Useful Lives
 
December 31, 2015
Management and franchise agreement intangibles
$
589

 
25

 
$
535

Lease related intangibles
115

 
111

 
136

Brand intangibles
16

 

 
7

Advanced booking intangibles
11

 
6

 
12

Other
6

 
14

 
8

 
737

 
 
 
698

Accumulated amortization
(138
)
 
 
 
(151
)
Intangibles, net
$
599

 
 
 
$
547

Amortization expense relating to intangible assets was as follows:
 
Years Ended December 31,
 
2016
 
2015
 
2014
Amortization expense
$
27

 
$
31

 
$
30

We estimate amortization expense for definite-lived intangibles as follows:
Years Ending December 31,
 
2017
$
32

2018
30

2019
30

2020
30

2021
29

Debt (Tables)
 
December 31, 2016
 
December 31, 2015
$250 million senior unsecured notes maturing in 2016—3.875%
$

 
$
250

$196 million senior unsecured notes maturing in 2019—6.875%
196

 
196

$250 million senior unsecured notes maturing in 2021—5.375%
250

 
250

$350 million senior unsecured notes maturing in 2023—3.375%
350

 
350

$400 million senior unsecured notes maturing in 2026—4.850%
400

 

Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A
130

 
130

Contract Revenue Bonds, Senior Taxable Series 2005B
59

 
63

Floating average rate construction loan
79

 
65

Senior secured term loan

 
64

Revolving credit facility
100

 

Other
1

 

Long-term debt before capital lease obligations
1,565

 
1,368

Capital lease obligations
15

 
16

Total long-term debt
1,580

 
1,384

Less current maturities
(119
)
 
(328
)
Less unamortized discounts and deferred financing fees
(16
)
 
(14
)
Total long-term debt, net of current maturities
$
1,445

 
$
1,042

Under existing agreements, maturities of debt for the next five years and thereafter are as follows:
Years Ending December 31,
 
2017
$
119

2018
19

2019
215

2020
19

2021
269

Thereafter
939

Total
$
1,580

We had the following debt balances, excluding capital lease obligations, as described above:
 
December 31, 2016
 
Carrying Value
 
Fair Value
 
Quoted Prices in Active Markets for Identical Assets (Level One)
 
Significant Other Observable Inputs (Level Two)
 
Significant Unobservable Inputs (Level Three)
Debt, excluding capital lease obligations
$
1,549

 
$
1,642

 
$

 
$
1,450

 
$
192

 
December 31, 2015
 
Carrying Value
 
Fair Value
 
Quoted Prices in Active Markets for Identical Assets (Level One)
 
Significant Other Observable Inputs (Level Two)
 
Significant Unobservable Inputs (Level Three)
Debt, excluding capital lease obligations
$
1,354

 
$
1,421

 
$

 
$
1,277

 
$
144

Leases (Tables)
The future minimum lease payments for our corporate office space and leased hotels due in each of the next five years and thereafter are as follows:
Years Ending December 31,
Operating Leases
 
Capital Leases
2017
$
41

 
$
2

2018
35

 
3

2019
39

 
3

2020
29

 
2

2021
26

 
2

Thereafter
444

 
8

Total minimum lease payments
$
614

 
$
20

Less amount representing interest
 
 
5

Present value of minimum lease payments
 
 
$
15

A summary of rent expense from continuing operations for all operating leases is as follows:
 
Years Ended December 31,
2016
 
2015
 
2014
Minimum rentals
$
37

 
$
34

 
$
35

Contingent rentals
53

 
53

 
49

Total
$
90

 
$
87

 
$
84

The future minimum lease receipts scheduled to be received in each of the next five years and thereafter are as follows:
Years Ending December 31,
 
2017
$
22

2018
17

2019
13

2020
12

2021
11

Thereafter
58

Total minimum lease receipts
$
133

Other Long-Term Liabilities (Tables)
Other Long-Term Liabilities
Other long-term liabilities consisted of the following:
 
December 31, 2016
 
December 31, 2015
Deferred gains on sales of hotel properties
$
363

 
$
367

Deferred compensation plans (see Note 11)
352

 
333

Hyatt Gold Passport Fund (see Note 2)
296

 
280

Guarantee liabilities (see Note 14)
124

 
120

Other accrued income taxes (see Note 13)
100

 
127

Deferred income taxes (see Note 13)
57

 
59

Defined benefit plans (see Note 11)
20

 
20

Other
160

 
141

Total
$
1,472

 
$
1,447

Income Taxes (Tables)
The domestic and foreign components of income before income taxes are as follows:
 
Years Ended December 31,
2016
 
2015
 
2014
U.S. income before tax
$
180

 
$
119

 
$
493

Foreign income before tax
109

 
75

 
32

Income before income taxes
$
289

 
$
194

 
$
525

The provision (benefit) for income taxes from continuing operations is comprised of the following:
 
Years Ended December 31,
2016
 
2015
 
2014
Current:
 
 
 
 
 
Federal
$
66

 
$
134

 
$
164

State
15

 
18

 
7

Foreign
7

 
21

 
36

Total Current
$
88

 
$
173

 
$
207

Deferred:
 
 
 
 
 
Federal
$
(12
)
 
$
(78
)
 
$
(10
)
State
(2
)
 
(20
)
 
(6
)
Foreign
11

 
(5
)
 
(12
)
Total Deferred
$
(3
)
 
$
(103
)
 
$
(28
)
Total
$
85

 
$
70

 
$
179

The following is a reconciliation of the statutory federal income tax rate to the effective tax rate from continuing operations:
 
Years Ended December 31,
2016
 
2015
 
2014
Statutory U.S. federal income tax rate
35.0
 %
 
35.0
 %
 
35.0
 %
State income taxes—net of federal tax benefit
3.4

 
3.5

 
3.4

Impact of foreign operations (excluding unconsolidated hospitality ventures losses)
(5.4
)
 
(13.8
)
 
0.9

Foreign unconsolidated hospitality ventures
1.2

 
10.0

 
0.8

Playa foreign tax credit benefit
(2.6
)
 

 

Tax contingencies
(5.2
)
 
(1.5
)
 
(2.6
)
Change in valuation allowances
3.6

 
3.1

 
(1.0
)
General business credits
(0.8
)
 
(1.9
)
 
(0.4
)
Equity based compensation
0.4

 
(0.5
)
 
0.4

Other
(0.1
)
 
2.3

 
(2.4
)
Effective income tax rate
29.5
 %
 
36.2
 %
 
34.1
 %
The components of the net deferred tax assets and deferred tax liabilities are comprised of the following:
 
December 31, 2016
 
December 31, 2015
Deferred tax assets related to:
 
 
 
Employee benefits
$
202

 
$
196

Foreign and state net operating losses and credit carryforwards
46

 
34

Investments
55

 
70

Allowance for uncollectible assets
36

 
36

Intangibles

 
4

Deferred gains on sales of hotel properties
134

 
142

Hyatt Gold Passport Fund
81

 
81

Interest and state benefits
2

 
2

Unrealized losses
5

 
5

Other
54

 
50

Valuation allowance
(27
)
 
(17
)
Total deferred tax asset
$
588

 
$
603

Deferred tax liabilities related to:
 
 
 
Property and equipment
$
(224
)
 
$
(258
)
Investments
(28
)
 
(33
)
Intangibles
(14
)
 

Unrealized gains
(39
)
 
(45
)
Prepaid expenses
(12
)
 
(13
)
Other
(15
)
 
(12
)
Total deferred tax liabilities
$
(332
)
 
$
(361
)
Net deferred tax assets
$
256

 
$
242

Recognized in the balance sheet as:
 
 
 
Deferred tax assets—noncurrent
$
313

 
$
301

Deferred tax liabilities—noncurrent
(57
)
 
(59
)
Total
$
256

 
$
242

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
 
2016
 
2015
Unrecognized tax benefits—beginning balance
$
110

 
$
40

Total increases—current period tax positions
2

 
13

Total (decreases) increases—prior period tax positions
(21
)
 
69

Lapse of statute of limitations
(5
)
 
(8
)
Foreign currency fluctuation

 
(4
)
Unrecognized tax benefits—ending balance
$
86

 
$
110

Commitments and Contingencies (Tables)
 
 
The Four Managed Hotels in France
 
Other Performance Guarantees
 
Total
 
 
2016
 
2015
 
2016
 
2015
 
2016
 
2015
Beginning balance, January 1
 
$
93

 
$
106

 
$
4

 
$
5

 
$
97

 
$
111

Initial guarantee obligation liability
 

 

 
9

 

 
9

 

Amortization of initial guarantee obligation liability into income
 
(33
)
 
(10
)
 
(1
)
 
(2
)
 
(34
)
 
(12
)
Performance guarantee expense (income), net
 
64

 
28

 
(1
)
 
(1
)
 
63

 
27

Net (payments) receipts during the year
 
(57
)
 
(20
)
 
2

 
2

 
(55
)
 
(18
)
Foreign currency exchange, net
 
(1
)
 
(11
)
 

 

 
(1
)
 
(11
)
Ending balance, December 31
 
$
66

 
$
93

 
$
13

 
$
4

 
$
79

 
$
97

Included within debt repayment guarantees are the following:
Property Description
 
Maximum Potential Future Payments
 
Maximum Exposure Net of Recoverability from Third Parties
 
Amount Recorded at December 31, 2016
 
Amount Recorded at December 31, 2015
 
Year of Guarantee Expiration
Hotel property in Washington (1), (3), (4), (5)
 
$
215

 
$

 
$
35

 
$

 
2020
Hotel properties in India (2), (3)
 
177

 
177

 
21

 
27

 
2020
Hotel property in Brazil (1)
 
80

 
40

 
3

 
4

 
2020
Hotel property in Minnesota
 
25

 
25

 
2

 
2

 
2021
Hotel property in Arizona (1), (4)
 
25

 

 
2

 
3

 
2019
Hotel properties in California (1)
 
21

 
8

 
6

 

 
2020
Hotel property in Colorado
 
8

 
8

 

 

 
2017
Other (1)
 
25

 
1

 

 
3

 
various, through 2017
Total
 
$
576

 
$
259

 
$
69

 
$
39

 
 

(1) We have agreements with either our unconsolidated hospitality venture partner, the respective hotel owners or other third parties to recover certain amounts funded under the debt repayment guarantee; the recoverability mechanism may be in the form of cash, financing receivable, or HTM debt securities.
(2) We have the contractual right to recover amounts funded from the unconsolidated hospitality venture, which is a related party. We expect our maximum exposure to be $89 million, taking into account our partner’s 50% ownership interest in the unconsolidated hospitality venture.
(3) Under certain events or conditions, we have the right to force the sale of the property(ies) in order to recover amounts funded.
(4) If certain funding thresholds are met or if certain events occur, we have the ability to assume control of the property.
(5) We are subject to a completion guarantee whereby the parties agree to substantially complete the construction of the project by a specified date. In the event of default, we are obligated to complete construction using the funds available from the outstanding loan. Any additional funds paid by us are subject to recovery through a HTM debt security.
Due to the lack of readily available market data, our fair value estimates utilize the following Level Three unobservable inputs:
 
2016
 
2015
Discount rates
10.6% - 12.6%
 
9.5% - 12.6%
Stabilized growth rates
1.8% - 4.8%
 
1.8% - 4.8%
Capitalization rates (1)
7.0% - 10.0%
 
6.5% - 10.0%
Term
0.2 - 7.0 years
 
0.3 - 5.0 years
(1) Reflects the risk profile of the individual markets where the assets are located and are not necessarily indicative of our portfolio as a whole.
Stockholders' Equity and Comprehensive Loss (Tables)
Schedule of Accumulated Other Comprehensive Loss
The following tables detail the accumulated other comprehensive loss activity for the years ended December 31, 2016 and December 31, 2015, respectively.
 
Balance at
January 1, 2016
 
Current period other comprehensive income (loss) before reclassification
 
Amount reclassified from accumulated other comprehensive loss (a)
 
Balance at
December 31, 2016
Foreign currency translation adjustments
$
(257
)
 
$
(45
)
 
$
3

 
$
(299
)
Unrealized gains (losses) on AFS securities
39

 
(6
)
 

 
33

Unrecognized pension cost
(7
)
 

 

 
(7
)
Unrealized gains (losses) on derivative instruments
(5
)
 
1

 

 
(4
)
Accumulated other comprehensive income (loss)
$
(230
)
 
$
(50
)
 
$
3

 
$
(277
)
(a) The amount reclassified from accumulated other comprehensive loss related to the sale of the shares of the company that owns Hyatt Regency Birmingham (U.K.) and was recorded within other long-term liabilities on our consolidated balance sheets.
 
 
 
 
 
 
 
 
 
Balance at
January 1, 2015
 
Current period other comprehensive income (loss) before reclassification
 
Amount reclassified from accumulated other comprehensive loss (b)
 
Balance at
December 31, 2015
Foreign currency translation adjustments
$
(155
)
 
$
(123
)
 
$
21

 
$
(257
)
Unrealized gains on AFS securities
6

 
33

 

 
39

Unrecognized pension cost
(5
)
 
(2
)
 

 
(7
)
Unrealized gains (losses) on derivative instruments
(6
)
 
1

 

 
(5
)
Accumulated other comprehensive income (loss)
$
(160
)
 
$
(91
)
 
$
21

 
$
(230
)
(b) The amount reclassified from accumulated other comprehensive loss was recognized within equity earnings (losses) from unconsolidated hospitality ventures on our consolidated statements of income.
Stock-Based Compensation (Tables)
Stock-based compensation expense (income) primarily included in selling, general, and administration expense on our consolidated statements of income related to these awards was as follows:
 
Years Ended December 31,
 
2016
 
2015
 
2014
SARs
$
10

 
$
9

 
$
19

RSUs
15

 
17

 
31

PSUs and PSs

 
(3
)
 
4

The expected income tax benefit to be realized at the time of vest related to these awards for the years ended December 31, 2016, December 31, 2015 and December 31, 2014 was as follows: 
 
Years Ended December 31,
 
2016
 
2015
 
2014
SARs
$
4

 
$
3

 
$
7

RSUs
5

 
5

 
8

PSUs and PSs

 
(1
)
 
2

The following table sets forth a summary of the SAR grants in 2016, 2015, and 2014: 
Grant Date
 
SARs Granted
 
Value at Date of Grant
 
Vesting Period
 
Vesting Start Month
March 2016
 
45,710

 
$
14.22

 
33
% annually
 
March 2017
March 2016
 
878,714

 
14.54

 
25
% annually
 
March 2017
March 2015
 
380,604

 
20.64

 
25
% annually
 
March 2016
March 2015
 
41,373

 
24.17

 
50
% annually
 
March 2018
February 2015
 
39,401

 
25.38

 
100
% at vest
 
March 2018
February 2014
 
327,307

 
22.57

 
25
% annually
 
March 2015
The fair value of each SAR was estimated based on the date of grant using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions: 
 
2016
 
2015
 
2014
Exercise Price
$
47.36

 
$
56.57

 
$
49.39

Expected Life in Years
6.227

 
6.309

 
6.290

Risk-free Interest Rate
1.55
%
 
1.63
%
 
1.93
%
Expected Volatility
27.72
%
 
35.39
%
 
44.32
%
Annual Dividend Yield
%
 
%
 
%
A summary of employee SAR activity is presented below: 
 
SAR Units
 
Weighted Average Exercise Price (in whole dollars)
 
Weighted Average Contractual Term
Outstanding at December 31, 2015:
3,876,937

 
$
47.63

 
5.03
Granted
924,424

 
47.36

 
9.22
Exercised
(325,339
)
 
43.09

 
2.08
Forfeited or canceled
(22,035
)
 
53.32

 
5.04
Outstanding at December 31, 2016:
4,453,987

 
$
47.88

 
5.25
Exercisable at December 31, 2016:
2,855,153

 
$
47.09

 
3.44
The following table sets forth a summary of the employee RSU grants: 
Grant Date
 
RSUs
 
Value
 
Total Value (in millions)
 
Vesting Period
December 2016
 
40,633

 
$
56.60

 
$
2

 
4 years
March 2016
 
444,629

 
47.36

 
21

 
4 years
December 2015
 
4,089

 
48.90

 

 
4 years
September 2015
 
3,898

 
51.30

 

 
3 years
September 2015
 
8,576

 
51.30

 

 
4 years
May 2015
 
23,746

 
58.95

 
1

 
4 years
March 2015
 
380,939

 
56.27

 
21

 
4 years
February 2015
 
29,278

 
59.77

 
2

 
4 years
September 2014
 
2,452

 
61.17

 

 
4 years
February 2014
 
376,328

 
49.39

 
19

 
4 years
A summary of the status of the nonvested employee restricted stock unit awards outstanding under the LTIP is presented below: 
 
Restricted Stock
Units
 
Weighted Average Grant Date Fair Value (in whole dollars)
Nonvested at December 31, 2015:
1,014,574

 
$
50.02

Granted
485,262

 
48.13

Vested
(394,087
)
 
47.42

Forfeited or canceled
(89,572
)
 
49.78

Nonvested at December 31, 2016:
1,016,177

 
$
50.15

The following table sets forth a summary of PSU and PS grants:
Year Granted
 
PSUs and PSs Granted
 
Weighted Average Grant Date Fair Value (in whole dollars)
 
Performance Period
 
Performance Period Start Date
2016 PSUs
 
111,620

 
$
47.36

 
3 years
 
January 1, 2016
2015 PSs
 
146,902

 
$
56.27

 
3 years
 
January 1, 2015
2014 PSs
 
162,906

 
$
49.39

 
3 years
 
January 1, 2014
Our total unearned compensation for our stock-based compensation programs at December 31, 2016 was $6 million for SARs, $15 million for RSUs and $4 million for PSUs and PSs, which is expected to be recorded to compensation expense as follows: 
 
2017
 
2018
 
2019
 
2020
 
Total
SARs
$
3

 
$
2

 
$
1

 
$

 
$
6

RSUs
7

 
4

 
3

 
1

 
15

PSUs and PSs
2

 
2

 

 

 
4

Total
$
12

 
$
8

 
$
4

 
$
1

 
$
25

Segment and Geographic Information (Tables)
The table below shows summarized consolidated financial information by segment. Included within corporate and other are unallocated corporate expenses, license fees related to Hyatt Residence Club, our co-branded credit card and our vacation ownership business prior to the sale in the fourth quarter of 2014. 
 
Years Ended December 31,
2016
 
2015
 
2014
Owned and leased hotels
 
 
 
 
 
Owned and leased hotels revenues
$
2,119

 
$
2,079

 
$
2,246

Intersegment revenues (a)
11

 

 

Adjusted EBITDA
516

 
493

 
523

Depreciation and amortization
285

 
277

 
322

Capital expenditures
200

 
225

 
208

Americas management and franchising
 
 
 
 
 
Management and franchise fees revenues
371

 
354

 
327

Other revenues from managed properties
1,670

 
1,641

 
1,550

Intersegment revenues (a)
75

 
74

 
88

Adjusted EBITDA
318

 
300

 
265

Depreciation and amortization
18

 
19

 
18

Capital expenditures

 

 
1

ASPAC management and franchising
 
 
 
 
 
Management and franchise fees revenues
96

 
91

 
88

Other revenues from managed properties
98

 
87

 
74

Intersegment revenues (a)
2

 
2

 
2

Adjusted EBITDA
57

 
55

 
49

Depreciation and amortization
1

 
1

 
1

Capital expenditures
1

 
1

 
1

EAME/SW Asia management and franchising
 
 
 
 
 
Management and franchise fees revenues
65

 
67

 
77

Other revenues from managed properties
65

 
58

 
53

Intersegment revenues (a)
10

 
13

 
15

Adjusted EBITDA
33

 
33

 
43

Depreciation and amortization
5

 
5

 
6

Capital expenditures
1

 

 

Corporate and other
 
 
 
 
 
Revenues
43

 
40

 
75

Other revenues from managed properties

 

 
30

Adjusted EBITDA
(139
)
 
(131
)
 
(103
)
Depreciation and amortization
33

 
18

 
7

Capital expenditures
9

 
43

 
43

Eliminations (a)
 
 
 
 
 
Revenues
(98
)
 
(89
)
 
(105
)
Adjusted EBITDA

 

 

Depreciation and amortization

 

 

Capital expenditures

 

 

TOTAL
 
 
 
 
 
Revenues
$
4,429

 
$
4,328

 
$
4,415

Adjusted EBITDA
785

 
750

 
777

Depreciation and amortization
342

 
320

 
354

Capital expenditures
211

 
269

 
253

(a)
Intersegment revenues are included in the management and franchise fees revenues and owned and leased hotels revenues and eliminated in Eliminations.
The table below presents summarized consolidated balance sheet information by segment:
Total Assets
 
December 31, 2016
 
December 31, 2015
Owned and leased hotels
$
5,393

 
$
5,281

Americas management and franchising
564

 
464

ASPAC management and franchising
128

 
131

EAME/SW Asia management and franchising
186

 
234

Corporate and other
1,478

 
1,481

TOTAL
$
7,749

 
$
7,591

The following tables present revenues and property and equipment, net, intangibles, net and goodwill by geographical region: 
 
Years Ended December 31,
2016
 
2015
 
2014
Revenues:
 
 
 
 
 
United States
$
3,571

 
$
3,494

 
$
3,476

All Foreign
858

 
834

 
939

Total
$
4,429

 
$
4,328

 
$
4,415

 
 
 
 
 
 
 
December 31, 2016
 
December 31, 2015
 
 
Property and equipment, net, Intangibles, net and Goodwill:
 
 
 
 
 
United States
$
3,915

 
$
3,562

 
 
All Foreign
1,079

 
1,145

 
 
Total
$
4,994

 
$
4,707

 
 
The table below provides a reconciliation of our net income attributable to Hyatt Hotels Corporation to EBITDA and a reconciliation of EBITDA to our consolidated Adjusted EBITDA
 
Years Ended December 31,
2016
 
2015
 
2014
Net income attributable to Hyatt Hotels Corporation
$
204

 
$
124

 
$
344

Interest expense
76

 
68

 
71

Provision for income taxes
85

 
70

 
179

Depreciation and amortization
342

 
320

 
354

EBITDA
707

 
582

 
948

Equity (earnings) losses from unconsolidated hospitality ventures
(68
)
 
64

 
(25
)
Stock-based compensation expense
25

 
23

 
49

(Gains) losses on sales of real estate and other
23

 
(9
)
 
(311
)
Asset impairments

 
5

 
17

Other (income) loss, net
(2
)
 
5

 
17

Net income attributable to noncontrolling interests

 

 
2

Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA
100

 
80

 
80

Adjusted EBITDA
$
785

 
$
750

 
$
777

Earnings Per Share (Tables)
The calculation of basic and diluted earnings per share, including a reconciliation of the numerator and denominator, are as follows: 
 
Years Ended December 31,
2016
 
2015
 
2014
Numerator:
 
 
 
 
 
Net income
$
204

 
$
124

 
$
346

Net (income) loss attributable to noncontrolling interests

 

 
(2
)
Net income attributable to Hyatt Hotels Corporation
$
204

 
$
124

 
$
344

Denominator:
 
 
 
 
 
Basic weighted average shares outstanding
132,930,578

 
142,814,868

 
153,136,511

Share-based compensation
1,008,753

 
1,184,455

 
1,213,941

Diluted weighted average shares outstanding
133,939,331

 
143,999,323

 
154,350,452

Basic Earnings Per Share:
 
 
 
 
 
Net income
$
1.53

 
$
0.87

 
$
2.26

Net (income) loss attributable to noncontrolling interests

 

 
(0.01
)
Net income attributable to Hyatt Hotels Corporation
$
1.53

 
$
0.87

 
$
2.25

Diluted Earnings Per Share:
 
 
 
 
 
Net income
$
1.52

 
$
0.86

 
$
2.24

Net (income) loss attributable to noncontrolling interests

 

 
(0.01
)
Net income attributable to Hyatt Hotels Corporation
$
1.52

 
$
0.86

 
$
2.23

The computations of diluted net income per share for the years ended December 31, 2016, December 31, 2015 and December 31, 2014 do not include the following shares of Class A common stock assumed to be issued as stock-settled SARs and RSUs because they are anti-dilutive.
 
Years Ended December 31,
 
2016
 
2015
 
2014
SARs
74,500

 
1,500

 
5,200

RSUs
900

 



Other Income (Loss), Net (Tables)
Other income (loss), net
 
For the years ended December 31,
2016
 
2015
 
2014
Performance guarantee liability amortization (Note 14)
34

 
12

 
7

Depreciation recovery
25

 
12

 
2

Interest income
19

 
8

 
11

Foreign currency gains (losses), net
1

 
(14
)
 
(3
)
Realized losses (Note 4)
(6
)
 

 

Performance guarantee expense, net (Note 14)
(63
)
 
(27
)
 
(23
)
Other
(8
)
 
4

 
(11
)
Other income (loss), net
$
2

 
$
(5
)
 
$
(17
)
Quarterly Financial Information (Unaudited) (Tables)
Schedule of Quarterly Financial Information
The following table sets forth the historical unaudited quarterly financial data. The information for each of these periods has been prepared on the same basis as the audited consolidated financial statements and, in our opinion, reflects all adjustments necessary to present fairly our financial results. Operating results for previous periods do not necessarily indicate results that may be achieved in any future period.
 
For the three months ended
December 31, 2016
 
September 30, 2016
 
June 30, 2016
 
March 31, 2016
 
December 31, 2015
 
September 30, 2015
 
June 30, 2015
 
March 31, 2015
Consolidated statements of income data:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Owned and leased hotels
$
514

 
$
519

 
$
559

 
$
516

 
$
530

 
$
500

 
$
540

 
$
509

Management and franchise fees
116

 
110

 
115

 
107

 
107

 
103

 
112

 
105

Other revenues
9

 
11

 
11

 
9

 
10

 
10

 
9

 
7

Other revenues from managed properties
448

 
448

 
480

 
457

 
462

 
440

 
451

 
433

Total revenues
1,087

 
1,088

 
1,165

 
1,089

 
1,109

 
1,053

 
1,112

 
1,054

Direct and selling, general, and administrative expenses
1,027

 
1,019

 
1,063

 
1,021

 
1,047

 
965

 
998

 
995

Net income
41

 
62

 
67

 
34

 
37

 
25

 
40

 
22

Net income attributable to Hyatt Hotels Corporation
41

 
62

 
67

 
34

 
37

 
25

 
40

 
22

Net income per common share, basic
$
0.31

 
$
0.48

 
$
0.50

 
$
0.25

 
$
0.26

 
$
0.18

 
$
0.28

 
$
0.15

Net income per common share, diluted
$
0.31

 
$
0.47

 
$
0.49

 
$
0.25

 
$
0.26

 
$
0.18

 
$
0.27

 
$
0.15

 

Organization (Details)
Dec. 31, 2016
Countries
Organization
 
Number of countries in which entity operates (number of countries)
56 
All inclusive
 
Organization
 
Number of hotels operated or franchised (number of hotels)
Number of rooms operated or franchised (number of rooms)
2,401 
Full Service
 
Organization
 
Number of hotels operated or franchised (number of hotels)
315 
Number of rooms operated or franchised (number of rooms)
123,117 
Select Service
 
Organization
 
Number of hotels operated or franchised (number of hotels)
342 
Number of rooms operated or franchised (number of rooms)
48,016 
Select Service |
United States
 
Organization
 
Number of hotels operated or franchised (number of hotels)
313 
Summary of Significant Accounting Policies (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2016
Proceeds from Sales in Escrow
Dec. 31, 2015
Proceeds from Sales in Escrow
Dec. 31, 2016
Captive insurance subsidiary
Dec. 31, 2015
Captive insurance subsidiary
Dec. 31, 2016
Other Restricted Cash
Dec. 31, 2015
Other Restricted Cash
Dec. 31, 2016
Grand Hyatt San Antonio
Dec. 31, 2015
Grand Hyatt San Antonio
Dec. 31, 2016
Hyatt Gold Passport Fund
Dec. 31, 2015
Hyatt Gold Passport Fund
Dec. 31, 2016
Accounting Standards Update 2014-09
Dec. 31, 2015
Long-term Debt
Accounting Standards Update 2015-03
Dec. 31, 2015
Other Assets
Accounting Standards Update 2015-03
Accounting Policies
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Restricted cash
$ 76 
$ 96 
$ 40 
$ 70 
$ 9 
$ 7 
$ 13 
$ 6 
$ 14 
$ 13 
 
 
 
 
 
Restricted cash and cash equivalents, noncurrent
 
 
 
 
 
 
 
 
11 
10 
 
 
 
 
 
Accrued liabilities, current
514 
516 
 
 
 
 
 
 
 
 
139 
166 
 
 
 
Debt issuance costs
 
 
 
 
 
 
 
 
 
 
 
 
 
(5)
Management fees revenue
 
 
 
 
 
 
 
 
 
 
 
 
$ 21 
 
 
Summary of Significant Accounting Policies (Property and Equipment) (Details)
12 Months Ended
Dec. 31, 2016
Minimum |
Buildings and improvements
 
Property, Plant and Equipment
 
Property, plant and equipment, useful life
10 years 
Minimum |
Furniture and equipment
 
Property, Plant and Equipment
 
Property, plant and equipment, useful life
3 years 
Minimum |
Computers
 
Property, Plant and Equipment
 
Property, plant and equipment, useful life
3 years 
Maximum |
Buildings and improvements
 
Property, Plant and Equipment
 
Property, plant and equipment, useful life
50 years 
Maximum |
Furniture and equipment
 
Property, Plant and Equipment
 
Property, plant and equipment, useful life
20 years 
Maximum |
Computers
 
Property, Plant and Equipment
 
Property, plant and equipment, useful life
7 years 
Summary of Significant Accounting Policies (Loyalty Program) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Condensed Balance Sheet Statements, Captions
 
 
Current Assets
$ 1,139 
$ 1,124 
TOTAL ASSETS
7,749 
7,591 
Current Liabilities
924 
1,107 
Total liabilities
3,841 
3,596 
Hyatt Gold Passport Fund
 
 
Condensed Balance Sheet Statements, Captions
 
 
Current Assets
150 
179 
Noncurrent Assets
296 
280 
TOTAL ASSETS
446 
459 
Current Liabilities
150 
179 
Noncurrent Liabilities
296 
280 
Total liabilities
$ 446 
$ 459 
Equity and Cost Method Investments (Equity And Cost Method Investment Balances) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Equity And Cost Method Investments [Abstract]
 
 
Equity method investments
$ 180 
$ 304 
Cost method investments
23 
Total investments
$ 186 
$ 327 
Equity and Cost Method Investments (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Schedule of Equity and Cost Method Investments
 
 
 
Investments
$ 186 
$ 327 
 
Equity method Investment, other than temporary impairment
Owned and Leased Hotels
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Investments
186 
311 
 
Andaz Maui at Wailea Resort
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Step acquisition, remeasurement gain
14 
 
 
Business acquisition, percentage of equity in acquiree before acquisition
65.70% 
 
 
Hyatt Regency Lost Pines Resort and Spa
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Step acquisition, remeasurement gain
 
 
12 
Business acquisition, percentage of equity in acquiree before acquisition
 
 
8.20% 
Payments to Acquire Businesses, Gross
 
 
164 
An Equity Method Investment
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Equity method investment, net sales proceeds
 
 
Equity method investment, realized gain on sale
 
 
Hyatt Place Hotel
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Equity method investment, net sales proceeds
15 
16 
 
Equity method investment, realized gain on sale
13 
 
Number of hotels sold
 
Foreign Currency Denominated Investment
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Equity method investment, net sales proceeds
 
 
Amount reclassified from accumulated other comprehensive loss
 
21 
 
Hyatt Regency DFW International Airport
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Equity method investment, net sales proceeds
 
 
19 
Equity method investment, deferred gain on sale
 
 
18 
2014 Hyatt Place Hotel Sale 1 |
Hyatt Place Hotel
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Equity method investment, net sales proceeds
 
 
12 
Equity method investment, deferred gain on sale
 
 
10 
2014 Hyatt Place Hotel Sale 2 |
Hyatt Place Hotel
 
 
 
Schedule of Equity and Cost Method Investments
 
 
 
Equity method investment, net sales proceeds
 
 
33 
Equity method investment, realized gain on sale
 
 
$ 22 
Number of hotels sold
 
 
Equity and Cost Method Investments (Carrying Value and Ownership Percentages of Equity Method Investments) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Schedule of Equity Method Investments
 
 
Investment Balance
$ 180 
$ 304 
Juniper Hotels Private Limited
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
50.00% 
 
Investment Balance
37 
44 
Playa Hotels & Resorts B.V.
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
23.70% 
 
Investment Balance
23 
28 
San Jose Hotel Partners, L.L.C.
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
40.00% 
 
Investment Balance
15 
12 
Four One Five, L.L.C.
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
49.00% 
 
Investment Balance
15 
Rio Preto Partners SARL
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
70.00% 
 
Investment Balance
14 
Desarrolladora Hotel Acueducto S. de R.L. de C.V.
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
50.00% 
 
Investment Balance
13 
15 
Hotel Hoyo Uno, S. de R.L. de C.V.
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
40.00% 
 
Investment Balance
13 
14 
Hotel Am Belvedere GmbH & Co KG
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
50.00% 
 
Investment Balance
12 
Wailea Hotel Holdings, L.L.C.
 
 
Schedule of Equity Method Investments
 
 
Ownership Interests
0.00% 
 
Investment Balance
125 
Other
 
 
Schedule of Equity Method Investments
 
 
Investment Balance
$ 38 
$ 54 
Equity and Cost Method Investments (Summarized Financial Information) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Equity And Cost Method Investments [Abstract]
 
 
 
Total revenues
$ 1,229 
$ 1,079 
$ 1,192 
Gross operating profit
398 
312 
329 
Income from continuing operations
160 
33 
31 
Net income
160 
33 
31 
Current Assets
443 
472 
 
Noncurrent Assets
2,701 
2,877 
 
Total Assets
3,144 
3,349 
 
Current Liabilities
385 
625 
 
Noncurrent Liabilities
2,037 
1,752 
 
Total Liabilities
$ 2,422 
$ 2,377 
 
Marketable Securities (Marketable Securities Held to Fund Operating Programs) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Hyatt Gold Passport Fund
 
 
Schedule of Investments
 
 
Total marketable securities held to fund operating programs
$ 394 
$ 384 
Deferred compensation plans held in rabbi trusts
 
 
Schedule of Investments
 
 
Total marketable securities held to fund operating programs
352 
333 
Captive Insurance Company
 
 
Schedule of Investments
 
 
Total marketable securities held to fund operating programs
65 
82 
Held for operating programs
 
 
Schedule of Investments
 
 
Total marketable securities held to fund operating programs
811 
799 
Less current portion of marketable securities held to fund operating programs included in cash and cash equivalents, short-term investments, and prepaids and other assets
(109)
(121)
Marketable securities held to fund operating programs included in other assets
$ 702 
$ 678 
Marketable Securities (Gain on Investments Held to Fund Operating Programs) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Gain on Investments
 
 
 
Net gains and interest income from marketable securities held to fund operating programs
$ 19 
$ 4 
$ 15 
Hyatt Gold Passport Fund
 
 
 
Gain on Investments
 
 
 
Net gains and interest income from marketable securities held to fund operating programs
Deferred compensation plans held in rabbi trusts
 
 
 
Gain on Investments
 
 
 
Net gains and interest income from marketable securities held to fund operating programs
$ 17 
$ 3 
$ 12 
Marketable Securities (Marketable Securities Held for Investment Purposes) (Details) (Held for Investment Purposes, USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Held for Investment Purposes
 
 
Schedule of Investments
 
 
Interest bearing money market funds
$ 106 
$ 5 
Time deposits
45 
30 
Preferred shares
290 
335 
Total marketable securities held for investment purposes
441 
370 
Less current portion of marketable securities held for investment purposes included in cash and cash equivalents and short-term investments
(151)
(35)
Marketable securities held for investment purposes included in other assets
$ 290 
$ 335 
Marketable Securities (Assets and Liabilities Measured at Fair Value on Recurring Basis) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
$ 1,252 
$ 1,169 
Level One - Quoted Prices in Active Markets for Identical Assets |
Interest bearing money market funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
114 
18 
Level One - Quoted Prices in Active Markets for Identical Assets |
Mutual funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
352 
333 
Level Two - Significant Other Observable Inputs |
Time deposits
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
59 
45 
Level Two - Significant Other Observable Inputs |
U.S. government obligations
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
142 
131 
Level Two - Significant Other Observable Inputs |
U.S. government agencies
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
53 
83 
Level Two - Significant Other Observable Inputs |
Corporate debt securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
181 
168 
Level Two - Significant Other Observable Inputs |
Mortgage-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
22 
26 
Level Two - Significant Other Observable Inputs |
Asset-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
34 
27 
Level Two - Significant Other Observable Inputs |
Municipal and provincial notes and bonds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Level Three - Significant Unobservable Inputs |
Preferred Shares
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
290 
335 
Cash and Cash Equivalents
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
114 
18 
Cash and Cash Equivalents |
Level One - Quoted Prices in Active Markets for Identical Assets |
Interest bearing money market funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
114 
18 
Cash and Cash Equivalents |
Level One - Quoted Prices in Active Markets for Identical Assets |
Mutual funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Two - Significant Other Observable Inputs |
Time deposits
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Two - Significant Other Observable Inputs |
U.S. government obligations
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Two - Significant Other Observable Inputs |
U.S. government agencies
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Two - Significant Other Observable Inputs |
Corporate debt securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Two - Significant Other Observable Inputs |
Mortgage-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Two - Significant Other Observable Inputs |
Asset-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Two - Significant Other Observable Inputs |
Municipal and provincial notes and bonds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Cash and Cash Equivalents |
Level Three - Significant Unobservable Inputs |
Preferred Shares
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
56 
46 
Short-term Investments |
Level One - Quoted Prices in Active Markets for Identical Assets |
Interest bearing money market funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level One - Quoted Prices in Active Markets for Identical Assets |
Mutual funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level Two - Significant Other Observable Inputs |
Time deposits
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
46 
38 
Short-term Investments |
Level Two - Significant Other Observable Inputs |
U.S. government obligations
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level Two - Significant Other Observable Inputs |
U.S. government agencies
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level Two - Significant Other Observable Inputs |
Corporate debt securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level Two - Significant Other Observable Inputs |
Mortgage-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level Two - Significant Other Observable Inputs |
Asset-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level Two - Significant Other Observable Inputs |
Municipal and provincial notes and bonds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Short-term Investments |
Level Three - Significant Unobservable Inputs |
Preferred Shares
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Prepaids and Other Assets
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
90 
92 
Prepaids and Other Assets |
Level One - Quoted Prices in Active Markets for Identical Assets |
Interest bearing money market funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Prepaids and Other Assets |
Level One - Quoted Prices in Active Markets for Identical Assets |
Mutual funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Prepaids and Other Assets |
Level Two - Significant Other Observable Inputs |
Time deposits
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Prepaids and Other Assets |
Level Two - Significant Other Observable Inputs |
U.S. government obligations
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
33 
32 
Prepaids and Other Assets |
Level Two - Significant Other Observable Inputs |
U.S. government agencies
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
10 
Prepaids and Other Assets |
Level Two - Significant Other Observable Inputs |
Corporate debt securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
35 
36 
Prepaids and Other Assets |
Level Two - Significant Other Observable Inputs |
Mortgage-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Prepaids and Other Assets |
Level Two - Significant Other Observable Inputs |
Asset-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Prepaids and Other Assets |
Level Two - Significant Other Observable Inputs |
Municipal and provincial notes and bonds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Prepaids and Other Assets |
Level Three - Significant Unobservable Inputs |
Preferred Shares
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Other Assets
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
992 
1,013 
Other Assets |
Level One - Quoted Prices in Active Markets for Identical Assets |
Interest bearing money market funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Other Assets |
Level One - Quoted Prices in Active Markets for Identical Assets |
Mutual funds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
352 
333 
Other Assets |
Level Two - Significant Other Observable Inputs |
Time deposits
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
13 
Other Assets |
Level Two - Significant Other Observable Inputs |
U.S. government obligations
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
109 
99 
Other Assets |
Level Two - Significant Other Observable Inputs |
U.S. government agencies
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
36 
67 
Other Assets |
Level Two - Significant Other Observable Inputs |
Corporate debt securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
145 
130 
Other Assets |
Level Two - Significant Other Observable Inputs |
Mortgage-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
17 
20 
Other Assets |
Level Two - Significant Other Observable Inputs |
Asset-backed securities
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
26 
20 
Other Assets |
Level Two - Significant Other Observable Inputs |
Municipal and provincial notes and bonds
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
Other Assets |
Level Three - Significant Unobservable Inputs |
Preferred Shares
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
Investments, fair value disclosure
$ 290 
$ 335 
Marketable Securities (Narrative) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
1 Months Ended 12 Months Ended
Oct. 31, 2016
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
 
 
Held-to-maturity securities
 
$ 27 
$ 25 
 
Playa Hotels & Resorts B.V. |
Preferred Shares
 
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
 
 
Available-for-sale securities, amortized cost basis
 
 
 
271 
Option to redeem investment in preferred shares
 
125 
 
 
Stock redeemed or called during period, shares (in shares)
3,458,530 
 
 
 
Preferred stock, redeemed
41 
41 
 
Interest income
12 
12 
 
Realized loss
 
Convertible preferred stock, redemption price per share (in dollars per share)
$ 8.40 
 
 
 
Minimum |
Playa Hotels & Resorts B.V. |
Preferred Shares
 
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
 
 
Sensitivity analysis of fair value, impact of assigned probabilities
 
 
 
Maximum |
Playa Hotels & Resorts B.V. |
Preferred Shares
 
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
 
 
Preferred stock, conversion commitment
 
50 
 
 
Sensitivity analysis of fair value, impact of assigned probabilities
 
$ 64 
 
 
Marketable Securities (Investments Classified as Available for Sale) (Details) (Preferred Shares, Playa Hotels & Resorts B.V., USD $)
In Millions, unless otherwise specified
1 Months Ended 12 Months Ended
Oct. 31, 2016
Dec. 31, 2016
Dec. 31, 2015
Preferred Shares |
Playa Hotels & Resorts B.V.
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
 
 
 
Fair value, beginning balance
 
$ 335 
$ 280 
Gross unrealized gains
 
19 
55 
Gross unrealized losses
 
(29)
Realized losses
(6)
(6)
Interest income
12 
12 
Cash redemption
(41)
(41)
Fair value, ending balance
 
$ 290 
$ 335 
Marketable Securities (Inputs, Assets, and Quantitative Information) (Details) (Playa Hotels & Resorts B.V., Preferred Shares)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Playa Hotels & Resorts B.V. |
Preferred Shares
 
 
Fair Value Inputs, Assets, Quantitative Information
 
 
Expected term
1 year 0 months 
0 years 9 months 
Risk-free Interest Rate
0.85% 
0.57% 
Volatility
46.50% 
46.00% 
Dividend Yield
12.00% 
12.00% 
Property and Equipment, Net (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Property, Plant and Equipment [Abstract]
 
 
Land
$ 901 
$ 674 
Buildings
4,125 
3,898 
Leasehold improvements
202 
220 
Furniture, equipment and computers
1,316 
1,209 
Construction in progress
90 
251 
Property and equipment, gross
6,634 
6,252 
Accumulated depreciation
(2,364)
(2,221)
Total property and equipment, net
$ 4,270 
$ 4,031 
Property and Equipment, Net (Depreciation Expense) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Property, Plant and Equipment [Abstract]
 
 
 
Depreciation expense
$ 315 
$ 289 
$ 324 
Property and Equipment, Net (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Property, Plant and Equipment [Line Items]
 
 
 
Capital leases, net
$ 12 
$ 13 
 
Capital leases, accumulated depreciation
10 
 
Interest costs, capitalized during period
Asset impairments
17 
Property, Plant and Equipment
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Asset impairments
$ 0 
$ 5 
$ 13 
Financing Receivables (Schedule Of Financing Receivables) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Less allowance for losses
$ (100)
$ (98)
$ (100)
Total long-term financing receivables, net
19 
20 
 
Unsecured Financing
 
 
 
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Unsecured financing
119 
120 
 
Less allowance for losses
(100)
(98)
(87)
Less current portion included in receivables, net
(2)
 
Total long-term financing receivables, net
$ 19 
$ 20 
 
Financing Receivables (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Preferred equity method investments
$ 180 
$ 304 
 
Preferred equity investment, held-to-maturity debt security
27 
25 
 
Provisions
10 
10 
 
Secured Financing
 
 
 
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Provisions
Secured Financing |
Settlement of Secured Financing
 
 
 
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Proceeds from secured debt
 
26 
 
Unsecured financing
 
 
Preferred equity method investments
 
 
Financing receivables net recovery
 
 
Secured Financing |
Settlement of Secured Financing |
Debt Securities
 
 
 
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Preferred equity investment, held-to-maturity debt security
 
 
Secured Financing |
Settlement of Secured Financing |
Cost-method Investments
 
 
 
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Preferred equity investment, cost method investment
 
 
Unsecured Financing
 
 
 
Accounts, Notes, Loans, and Financing Receivable
 
 
 
Unsecured financing
119 
120 
 
Provisions
$ 10 
$ 7 
$ 6 
Financing Receivables (Allowance For Credit Losses) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Allowance for Losses and Impairments
 
 
 
Allowance beginning balance
$ 98 
$ 100 
 
Provisions
10 
10 
 
Write-offs
(8)
(1)
 
Recoveries
 
(9)
 
Other adjustments
 
(2)
 
Allowance ending balance
100 
98 
 
Secured Financing
 
 
 
Allowance for Losses and Impairments
 
 
 
Allowance beginning balance
13 
 
Provisions
Write-offs
(1)
 
Recoveries
 
(9)
 
Other adjustments
 
(6)
 
Allowance ending balance
13 
Unsecured Financing
 
 
 
Allowance for Losses and Impairments
 
 
 
Allowance beginning balance
98 
87 
 
Provisions
10 
Write-offs
(8)
 
Recoveries
 
 
Other adjustments
 
 
Allowance ending balance
$ 100 
$ 98 
$ 87 
Financing Receivables (Credit Monitoring) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2016
Unsecured Financing
Dec. 31, 2015
Unsecured Financing
Dec. 31, 2014
Unsecured Financing
Dec. 31, 2016
Unsecured Financing
Loans
Dec. 31, 2015
Unsecured Financing
Loans
Dec. 31, 2016
Unsecured Financing
Impaired loans
Dec. 31, 2015
Unsecured Financing
Impaired loans
Dec. 31, 2016
Unsecured Financing
Total loans
Dec. 31, 2015
Unsecured Financing
Total loans
Dec. 31, 2016
Unsecured Financing
Other financing arrangements
Dec. 31, 2015
Unsecured Financing
Other financing arrangements
Unsecured Financing Receivables
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross Loan Balance (Principal and Interest)
 
 
 
$ 119 
$ 120 
 
$ 13 
$ 15 
 
 
$ 69 
$ 73 
$ 50 
$ 47 
Impaired Loans
 
 
 
 
 
 
 
 
56 
58 
 
 
 
 
Related Allowance
(100)
(98)
(100)
(100)
(98)
(87)
 
 
(56)
(58)
(44)
(40)
Impaired loans, Related Allowance
 
 
 
 
 
 
 
 
(56)
(58)
 
 
 
 
Net Financing Receivables
 
 
 
19 
22 
 
13 
15 
13 
15 
Gross Receivables on Non-Accrual Status
 
 
 
100 
98 
 
56 
58 
56 
58 
44 
40 
Impaired Financing Receivables, Unpaid Principal Balance
 
 
 
 
 
 
 
 
43 
42 
 
 
 
 
Impaired Financing Receivables, Average Recorded Investment
 
 
 
 
 
 
 
 
$ 57 
$ 55 
 
 
 
 
Financing Receivables Financing Receivables (Narrative-Fair Value) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]
 
 
Level Three financing receivables
$ 19 
$ 22 
Acquisitions and Dispositions (Acquisitions Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Business Acquisition [Line Items]
 
 
 
Acquisitions, net of cash acquired
$ (492)
$ (3)
$ (548)
Goodwill
125 
129 
133 
Advanced booking intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Acquired finite-lived intangible assets, weighted average useful life
6 years 
 
 
Management and franchise agreement intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Acquired finite-lived intangible assets, weighted average useful life
25 years 
 
 
Andaz Maui at Wailea Resort
 
 
 
Business Acquisition [Line Items]
 
 
 
Business acquisition, percentage of equity in acquiree before acquisition
65.70% 
 
 
Business acquisition, fair value in acquiree before acquisition
180 
 
 
Business acquisition, remaining interest percent acquired in acquisition
34.30% 
 
 
Acquisitions, net of cash acquired
(136)
 
 
Cash and cash equivalents
12 
 
 
Step acquisition, remeasurement gain
14 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, assets
352 
 
 
Property and equipment
323 
 
 
Inventories
13 
 
 
Prepaids and other assets
 
 
Land Held for Development
 
 
 
Business Acquisition [Line Items]
 
 
 
Payments to acquire land
25 
 
 
Royal Palms Resort and Spa
 
 
 
Business Acquisition [Line Items]
 
 
 
Acquisitions, net of cash acquired
(86)
 
 
Closing costs and proration adjustments
 
 
Payments to acquire businesses, gross
(88)
 
 
Royal Palms Resort and Spa |
Brand intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, assets
 
 
Royal Palms Resort and Spa |
Advanced booking intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, finite-lived intangibles
 
 
Royal Palms Resort and Spa |
Management and franchise agreement intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, finite-lived intangibles
 
 
Acquired finite-lived intangible assets, weighted average useful life
20 years 
 
 
Royal Palms Resort and Spa |
Property, Plant and Equipment
 
 
 
Business Acquisition [Line Items]
 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, assets
75 
 
 
The Confidante
 
 
 
Business Acquisition [Line Items]
 
 
 
Payments to acquire businesses, gross
(238)
 
 
The Confidante |
Management and franchise agreement intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Acquired finite-lived intangible assets, weighted average useful life
20 years 
 
 
The Confidante |
Property, Plant and Equipment
 
 
 
Business Acquisition [Line Items]
 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, assets
228 
 
 
The Confidante |
Management and franchise agreement intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, assets
10 
 
 
Hyatt Regency Lost Pines Resort and Spa
 
 
 
Business Acquisition [Line Items]
 
 
 
Business acquisition, percentage of equity in acquiree before acquisition
 
 
8.20% 
Cash and cash equivalents
 
 
Step acquisition, remeasurement gain
 
 
12 
Business combination, recognized identifiable assets acquired and liabilities assumed, finite-lived intangibles
 
 
Payments to acquire businesses, gross
 
 
(164)
Business combination, recognized identifiable assets acquired and liabilities assumed, assets
 
 
241 
Long-term debt
 
 
69 
Debt premium
 
 
Goodwill
 
 
17 
Goodwill, expected tax deductible amount
 
 
15 
Property and equipment
 
 
207 
Inventories
 
 
Hyatt Regency Lost Pines Resort and Spa |
Advanced booking intangibles
 
 
 
Business Acquisition [Line Items]
 
 
 
Business combination, recognized identifiable assets acquired and liabilities assumed, finite-lived intangibles
 
 
Acquired finite-lived intangible assets, weighted average useful life
 
 
14 months 
Park Hyatt New York
 
 
 
Business Acquisition [Line Items]
 
 
 
Acquisitions, net of cash acquired
 
 
(391)
Cash and cash equivalents
 
 
Payments to acquire businesses, gross
 
 
(392)
Property and equipment
 
 
386 
Inventories
 
 
Prepaids and other assets
 
 
$ 2 
Acquisitions and Dispositions (Andaz Maui at Wailea Resort Identifiable Assets Acquired and Liabilities Assumed) (Details) (Andaz Maui at Wailea Resort, USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Andaz Maui at Wailea Resort
 
Business Acquisition [Line Items]
 
Cash and cash equivalents
$ 12 
Receivables
Inventories
13 
Prepaids and other assets
Property and equipment
323 
Total assets
352 
Current liabilities
10 
Total liabilities
10 
Total net assets acquired
$ 342 
Acquisitions and Dispositions (Hyatt Regency Lost Pines Identifiable Assets Acquired and Liabilities Assumed ) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Business Acquisition [Line Items]
 
 
 
Goodwill
$ 125 
$ 129 
$ 133 
Hyatt Regency Lost Pines Resort and Spa
 
 
 
Business Acquisition [Line Items]
 
 
 
Cash and cash equivalents
 
 
Receivables
 
 
Inventories
 
 
Property and equipment
 
 
207 
Goodwill
 
 
17 
Intangibles
 
 
Deferred tax assets
 
 
Total assets
 
 
241 
Current portion of long-term debt
 
 
Current liabilities
 
 
Long-term debt
 
 
65 
Total liabilities
 
 
77 
Total net assets acquired
 
 
$ 164 
Acquisitions and Dispositions (Non-recurring Fair Value Measurement) (Details) (2016 Acquisitions, Assets, Fair Value, Measurements, Nonrecurring)
12 Months Ended
Dec. 31, 2016
Minimum
 
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
 
Fair value inputs, discount rate
7.25% 
Fair value input, terminal capitalization rate
5.50% 
Maximum
 
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
 
Fair value inputs, discount rate
9.00% 
Fair value input, terminal capitalization rate
7.75% 
Acquisitions and Dispositions (Dispositions Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
$ 289 
$ 88 
$ 1,467 
Deferred gain on sale of property
363 
367 
 
Gains (losses) on sales of real estate and other
(23)
311 
Hyatt Regency Birmingham
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
49 
 
 
Deferred gain on sale of property
17 
 
 
Andaz 5th Avenue
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
240 
 
 
Closing costs and proration adjustments
10 
 
 
Gains (losses) on sales of real estate and other
(23)
 
 
Hyatt Regency Indianapolis
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
69 
 
Gains (losses) on sales of real estate and other
 
 
Land Held for Development
 
 
 
Significant Acquisitions and Disposals
 
 
 
Equity method investment, ownership percentage
 
40.00% 
 
Proceeds from sales of real estate and other
 
14 
 
A Hyatt House Hotel
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
Gains (losses) on sales of real estate and other
 
 
Hyatt Place 2014
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
51 
Gains (losses) on sales of real estate and other
 
 
13 
Number of hotels sold
 
 
Park Hyatt Toronto
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
88 
Deferred gain on sale of property
 
 
49 
Hyatt Regency Vancouver
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
116 
Deferred gain on sale of property
 
 
64 
Hyatt Place, Hyatt House 2014
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
581 
Gains (losses) on sales of real estate and other
 
 
153 
Hyatt Place, Hyatt House 2014 |
Select Service
 
 
 
Significant Acquisitions and Disposals
 
 
 
Number of hotels sold
 
 
38 
Hyatt Place, Hyatt House 2014 |
Select Service |
Like-Kind exchange released from restricted cash
 
 
 
Significant Acquisitions and Disposals
 
 
 
Number of hotels sold
 
 
21 
Hyatt Place, Hyatt House 2014 |
Select Service |
Like-Kind Exchange remaining in restricted cash
 
 
 
Significant Acquisitions and Disposals
 
 
 
Number of hotels sold
 
 
Park Hyatt Washington
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
97 
Deferred gain on sale of property
 
 
57 
Hyatt Residential Group
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
220 
Gains (losses) on sales of real estate and other
 
 
80 
Hyatt, Hyatt Place, Hyatt House 2014
 
 
 
Significant Acquisitions and Disposals
 
 
 
Proceeds from sales of real estate and other, net of cash disposed
 
 
310 
Gains (losses) on sales of real estate and other
 
 
65 
Proceeds from sales of real estate and other
 
 
311 
Cash disposed from sale of assets
 
 
$ (1)
Combined long term agreements, minimum term
 
 
25 years 
Hyatt, Hyatt Place, Hyatt House 2014 |
Select Service
 
 
 
Significant Acquisitions and Disposals
 
 
 
Number of hotels sold
 
 
Hyatt, Hyatt Place, Hyatt House 2014 |
Full Service
 
 
 
Significant Acquisitions and Disposals
 
 
 
Number of hotels sold
 
 
Acquisitions and Dispositions (Like-Kind Exchanges Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2015
Hyatt Place 2014
Dec. 31, 2014
Hyatt Place 2014
Hotels
Dec. 31, 2015
Hyatt Place, Hyatt House 2014
Dec. 31, 2014
Hyatt Place, Hyatt House 2014
Dec. 31, 2014
Park Hyatt Washington
Dec. 31, 2014
Hyatt, Hyatt Place, Hyatt House 2014
Dec. 31, 2014
2013 Sale of Full Service Real Estate related to 1031 exchange
Dec. 31, 2013
2013 Sale of Full Service Real Estate related to 1031 exchange
Dec. 31, 2014
Full Service
Hyatt, Hyatt Place, Hyatt House 2014
Hotels
Dec. 31, 2014
Select Service
Hyatt Place, Hyatt House 2014
Hotels
Dec. 31, 2014
Select Service
Hyatt, Hyatt Place, Hyatt House 2014
Hotels
Dec. 31, 2014
Like-Kind exchange released from restricted cash
Select Service
Hyatt Place, Hyatt House 2014
Hotels
Dec. 31, 2014
Like-Kind Exchange
Select Service
Hyatt Place, Hyatt House 2014
Hotels
Dec. 31, 2014
Like-Kind Exchange
Select Service
Hyatt, Hyatt Place, Hyatt House 2014
Hotels
Dec. 31, 2015
Like-Kind Exchange remaining in restricted cash
Select Service
Hyatt Place, Hyatt House 2014
Hotels
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of hotels sold
 
 
 
 
 
 
 
 
 
 
38 
21 
27 
Sales proceeds transferred to escrow as restricted cash
$ 0 
$ 0 
$ (870)
 
$ (51)
 
$ (403)
$ (97)
$ (232)
 
$ (74)
 
 
 
 
 
 
 
Sales proceeds transferred from escrow to cash and cash equivalents
$ 29 
$ 143 
$ 714 
$ 51 
 
$ 92 
$ 311 
$ 97 
$ 232 
$ 74 
 
 
 
 
 
 
 
 
Goodwill and Intangible Assets, Net (Goodwill Changes Table) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Goodwill
 
 
 
Goodwill
$ 220 
$ 224 
$ 228 
Accumulated impairment losses
(95)
(95)
(95)
Foreign exchange
(4)
(4)
 
Goodwill, net
125 
129 
133 
Owned and Leased Hotels
 
 
 
Goodwill
 
 
 
Goodwill
187 
191 
195 
Accumulated impairment losses
(95)
(95)
(95)
Foreign exchange
(4)
(4)
 
Goodwill, net
92 
96 
100 
Americas Management and Franchising
 
 
 
Goodwill
 
 
 
Goodwill
33 
33 
33 
Accumulated impairment losses
Foreign exchange
 
Goodwill, net
$ 33 
$ 33 
$ 33 
Goodwill and Intangible Assets, Net (Intangible Assets Table) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Schedule of Intangible Asset by Major Class
 
 
Intangibles, gross
$ 737 
$ 698 
Accumulated amortization
(138)
(151)
Intangibles, net
599 
547 
Management and franchise agreement intangibles
 
 
Schedule of Intangible Asset by Major Class
 
 
Management and franchise agreement intangibles
589 
535 
Weighted average useful lives
25 years 
 
Lease related intangibles
 
 
Schedule of Intangible Asset by Major Class
 
 
Lease related intangibles
115 
136 
Weighted average useful lives
111 years 
 
Advanced booking intangibles
 
 
Schedule of Intangible Asset by Major Class
 
 
Advanced booking intangibles
11 
12 
Weighted average useful lives
6 years 
 
Other
 
 
Schedule of Intangible Asset by Major Class
 
 
Other
Weighted average useful lives
14 years 
 
Brand intangibles
 
 
Schedule of Intangible Asset by Major Class
 
 
Brand intangibles
$ 16 
$ 7 
Goodwill and Intangible Assets, Net (Amortization Expense Table) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]
 
 
 
Amortization expense
$ 27 
$ 31 
$ 30 
Goodwill and Intangible Assets, Net (Future Amortization Table) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
 
2017
$ 32 
2018
30 
2019
30 
2020
30 
2021
$ 29 
Goodwill and Intangible Assets, Net (Goodwill and Intangible Impairments) (Details) (USD $)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Owned and Leased Hotels
Dec. 31, 2014
Americas Management and Franchising
Goodwill
 
 
 
 
Goodwill, impairment loss
$ 0 
$ 0 
$ 2,000,000 
 
Definite-Lived intangible Assets
 
 
 
 
Definite-lived intangible impairment loss
$ 0 
$ 0 
 
$ 2,000,000 
Debt (Schedule of Debt) (Details)
In Millions, unless otherwise specified
Dec. 31, 2016
USD ($)
Dec. 31, 2015
USD ($)
Dec. 31, 2016
$250 million senior unsecured notes maturing in 2016—3.875%
USD ($)
Dec. 31, 2015
$250 million senior unsecured notes maturing in 2016—3.875%
USD ($)
Dec. 31, 2011
$250 million senior unsecured notes maturing in 2016—3.875%
Dec. 31, 2016
$196 million senior unsecured notes maturing in 2019—6.875%
USD ($)
Dec. 31, 2015
$196 million senior unsecured notes maturing in 2019—6.875%
USD ($)
Dec. 31, 2013
$196 million senior unsecured notes maturing in 2019—6.875%
USD ($)
Dec. 31, 2009
$196 million senior unsecured notes maturing in 2019—6.875%
Dec. 31, 2016
$250 million senior unsecured notes maturing in 2021—5.375%
USD ($)
Dec. 31, 2015
$250 million senior unsecured notes maturing in 2021—5.375%
USD ($)
Dec. 31, 2011
$250 million senior unsecured notes maturing in 2021—5.375%
Dec. 31, 2016
$350 million senior unsecured notes maturing in 2023—3.375%
USD ($)
Dec. 31, 2015
$350 million senior unsecured notes maturing in 2023—3.375%
USD ($)
Dec. 31, 2013
$350 million senior unsecured notes maturing in 2023—3.375%
Dec. 31, 2016
$400 million senior unsecured notes maturing in 2026—4.850%
USD ($)
Dec. 31, 2015
$400 million senior unsecured notes maturing in 2026—4.850%
USD ($)
Dec. 31, 2016
GH San Antonio Bonds
Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A
Contract Revenue Bonds
USD ($)
Dec. 31, 2015
GH San Antonio Bonds
Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A
Contract Revenue Bonds
USD ($)
Dec. 31, 2016
GH San Antonio Bonds
Contract Revenue Bonds, Senior Taxable Series 2005B
Contract Revenue Bonds
USD ($)
Dec. 31, 2015
GH San Antonio Bonds
Contract Revenue Bonds, Senior Taxable Series 2005B
Contract Revenue Bonds
USD ($)
Dec. 31, 2016
Floating average rate construction loan
USD ($)
Dec. 31, 2016
Floating average rate construction loan
BRL
Dec. 31, 2015
Floating average rate construction loan
USD ($)
Dec. 31, 2015
Floating average rate construction loan
BRL
Dec. 31, 2016
Senior secured term loan
USD ($)
Dec. 31, 2015
Senior secured term loan
USD ($)
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior unsecured notes
 
 
$ 0 
$ 250 
 
$ 196 
$ 196 
$ 196 
 
$ 250 
$ 250 
 
$ 350 
$ 350 
 
$ 400 
$ 0 
 
 
 
 
 
 
 
 
 
 
Floating average rate construction loan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
79 
258 
65 
260 
 
 
Revolving credit facility
100 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term debt gross
1,565 
1,368 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
130 
130 
59 
63 
 
 
 
 
64 
Capital lease obligations
15 
16 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total long-term debt
1,580 
1,384 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less current maturities
(119)
(328)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less unamortized discounts and deferred financing fees
(16)
(14)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total long-term debt, net of current maturities
1,445 
1,042 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, face amount
 
 
$ 250 
 
 
$ 196 
 
 
 
$ 250 
 
 
$ 350 
 
 
$ 400 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, interest rate, stated percentage
 
 
3.875% 
 
3.875% 
6.875% 
 
 
6.875% 
5.375% 
 
5.375% 
3.375% 
 
3.375% 
4.85% 
 
 
 
 
 
 
 
 
 
 
 
Debt (Schedule of Maturities) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Debt Disclosure [Abstract]
 
 
2017
$ 119 
 
2018
19 
 
2019
215 
 
2020
19 
 
2021
269 
 
Thereafter
939 
 
Total long-term debt
$ 1,580 
$ 1,384 
Debt (Senior Notes Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2013
$196 million senior unsecured notes maturing in 2019—6.875%
Dec. 31, 2016
$196 million senior unsecured notes maturing in 2019—6.875%
Dec. 31, 2015
$196 million senior unsecured notes maturing in 2019—6.875%
Dec. 31, 2009
$196 million senior unsecured notes maturing in 2019—6.875%
Dec. 31, 2016
$250 million senior unsecured notes maturing in 2016—3.875%
Dec. 31, 2015
$250 million senior unsecured notes maturing in 2016—3.875%
Dec. 31, 2011
$250 million senior unsecured notes maturing in 2016—3.875%
Dec. 31, 2016
$250 million senior unsecured notes maturing in 2021—5.375%
Dec. 31, 2015
$250 million senior unsecured notes maturing in 2021—5.375%
Dec. 31, 2011
$250 million senior unsecured notes maturing in 2021—5.375%
Dec. 31, 2016
$350 million senior unsecured notes maturing in 2023—3.375%
Dec. 31, 2015
$350 million senior unsecured notes maturing in 2023—3.375%
Dec. 31, 2013
$350 million senior unsecured notes maturing in 2023—3.375%
Dec. 31, 2016
$400 million senior unsecured notes maturing in 2026—4.850%
Dec. 31, 2015
$400 million senior unsecured notes maturing in 2026—4.850%
Dec. 31, 2016
Senior Notes
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption price, percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100.00% 
Senior notes
 
 
 
 
 
 
$ 250 
$ 250 
 
$ 250 
 
 
$ 250 
 
 
$ 350 
$ 400 
 
 
Debt instrument, interest rate, stated percentage
 
 
 
 
6.875% 
 
6.875% 
3.875% 
 
3.875% 
5.375% 
 
5.375% 
3.375% 
 
3.375% 
4.85% 
 
 
Discount price percentage
 
 
 
 
 
 
99.864% 
 
 
99.571% 
 
 
99.846% 
 
 
99.498% 
99.92% 
 
 
Debt instrument, periodic payment, principal
 
 
 
54 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Repayments of debt
 
 
 
66 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior unsecured notes
 
 
 
196 
196 
196 
 
250 
 
250 
250 
 
350 
350 
 
400 
 
Repayments of long-term debt
438 
208 
 
 
 
 
254 
 
 
 
 
 
 
 
 
 
 
 
Proceeds from issuance of long-term debt, net of issuance costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
396 
 
 
Debt issuance costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 4 
 
 
Debt (Senior Secured Term Loan Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Debt Instrument [Line Items]
 
 
 
Repayments of long-term debt
$ 438 
$ 5 
$ 208 
Hyatt Regency Lost Pines Resort and Spa |
Senior secured term loan
 
 
 
Debt Instrument [Line Items]
 
 
 
Repayments of long-term debt
$ 64 
 
 
Debt (Capital Lease Obligation Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Debt Instrument [Line Items]
 
 
 
Repayments of long-term capital lease obligations
$ 0 
$ 0 
$ 191 
Hyatt Regency Grand Cypress
 
 
 
Debt Instrument [Line Items]
 
 
 
Repayments of long-term capital lease obligations
 
 
$ 191 
Debt (Contract Revenue Bonds Narrative) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2013
GH San Antonio Bonds
Jun. 8, 2005
Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A
Contract Revenue Bonds
GH San Antonio Bonds
Jun. 8, 2005
Contract Revenue Bonds, Senior Taxable Series 2005B
Contract Revenue Bonds
GH San Antonio Bonds
Dec. 31, 2016
Minimum
Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A
Contract Revenue Bonds
GH San Antonio Bonds
Dec. 31, 2016
Minimum
Contract Revenue Bonds, Senior Taxable Series 2005B
Contract Revenue Bonds
GH San Antonio Bonds
Dec. 31, 2016
Maximum
Tax-Exempt Contract Revenue Empowerment Zone Bonds, Series 2005A
Contract Revenue Bonds
GH San Antonio Bonds
Dec. 31, 2016
Maximum
Contract Revenue Bonds, Senior Taxable Series 2005B
Contract Revenue Bonds
GH San Antonio Bonds
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
Long-term debt
$ 1,549 
$ 1,354 
$ 198 
$ 130 
$ 78 
 
 
 
 
Debt instrument, unamortized discount
 
 
$ 9 
 
 
 
 
 
 
Debt instrument, interest rate, stated percentage
 
 
 
 
 
4.75% 
5.10% 
5.00% 
5.31% 
Debt (Floating Average Rate Construction Loan Narrative) (Details) (Floating average rate construction loan)
In Millions, unless otherwise specified
12 Months Ended 12 Months Ended
Dec. 31, 2016
USD ($)
sub-loan
Dec. 31, 2016
BRL
Dec. 31, 2015
USD ($)
Dec. 31, 2015
BRL
Dec. 31, 2016
Subloan (a)
Dec. 31, 2016
Subloan (b)
Dec. 31, 2016
Subloan (c)
Dec. 31, 2016
Brazilian Long Term Interest Rate
Sub Loans (b) and (d)
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
Number of loans
 
 
 
 
 
 
Debt instrument, basis spread on variable rate
 
 
 
 
2.92% 
3.92% 
 
 
Debt instrument, interest rate, stated percentage
 
 
 
 
 
 
2.50% 
 
Debt instrument, variable interest rate percent, threshold for daily capitalization
 
 
 
 
 
 
 
6.00% 
Debt, weighted average interest rate
9.00% 
9.00% 
 
 
 
 
 
 
Floating average rate construction loan
$ 79 
 258 
$ 65 
 260 
 
 
 
 
Debt (Revolving Credit Facility Narrative) (Details) (USD $)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Jan. 6, 2014
Debt Instrument [Line Items]
 
 
 
Revolving credit facility
$ 100,000,000 
$ 0 
 
Letters of credit outstanding, amount
230,000,000 
 
 
Line of Credit |
Revolving Credit Facility |
Second Amended and Restated Credit Agreement
 
 
 
Debt Instrument [Line Items]
 
 
 
Line of credit facility, maximum borrowing capacity
 
 
1,500,000,000 
Revolving line of credit borrowed during period
210,000,000 
 
 
Repayments of line of credit
110,000,000 
 
 
Revolving credit facility
100,000,000 
 
Debt, weighted average interest rate
1.63% 
 
 
Line of credit facility, remaining borrowing capacity
1,400,000,000 
 
 
Additional Non-Revolving Credit Facility Banks [Member]
 
 
 
Debt Instrument [Line Items]
 
 
 
Letters of credit outstanding, amount
$ 230,000,000 
$ 228,000,000 
 
Debt (Fair Value) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Debt Instrument [Line Items]
 
 
Debt, excluding capital lease obligations, carrying value
$ 1,549 
$ 1,354 
Debt, excluding capital lease obligations, fair Value
1,642 
1,421 
Fair Value, Inputs, Level 1
 
 
Debt Instrument [Line Items]
 
 
Debt, excluding capital lease obligations, fair Value
Fair Value, Inputs, Level 2
 
 
Debt Instrument [Line Items]
 
 
Debt, excluding capital lease obligations, fair Value
1,450 
1,277 
Fair Value, Inputs, Level 3
 
 
Debt Instrument [Line Items]
 
 
Debt, excluding capital lease obligations, fair Value
$ 192 
$ 144 
Leases (Corporate Office Space) (Details) (Corporate Headquarters)
12 Months Ended
Dec. 31, 2016
Corporate Headquarters
 
Operating Leased Assets
 
Operating lease term
17 years 
Leases (Future Minimum Operating Lease Payments) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Leases [Abstract]
 
2017
$ 41 
2018
35 
2019
39 
2020
29 
2021
26 
Thereafter
444 
Total minimum lease payments
$ 614 
Leases (Future Minimum Capital Lease Payments) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Leases [Abstract]
 
2017
$ 2 
2018
2019
2020
2021
Thereafter
Total minimum lease payments
20 
Less amount representing interest
Present value of minimum lease payments
$ 15 
Leases (Rent Expense) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Leases [Abstract]
 
 
 
Minimum rentals
$ 37 
$ 34 
$ 35 
Contingent rentals
53 
53 
49 
Total
$ 90 
$ 87 
$ 84 
Leases (Retail Lease Receipts) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Operating Leases, Future Minimum Payments Receivable [Abstract]
 
2017
$ 22 
2018
17 
2019
13 
2020
12 
2021
11 
Thereafter
58 
Total minimum lease receipts
$ 133 
Leases Leases (Retail Rental Income Narrative) (Details) (Owned and Leased Hotels, USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Owned and Leased Hotels
 
 
 
Operating Leased Assets
 
 
 
Rental income
$ 25 
$ 28 
$ 28 
Employee Benefit Plans (Defined Benefit Plans) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Compensation and Retirement Disclosure [Abstract]
 
 
Accumulated benefit obligation
$ 21 
$ 21 
Accrued long-term benefit liability
20 
 
Expected benefits to be paid annually over the next 10 years
$ 1 
 
Employee Benefit Plans (Defined Contribution Plans) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Compensation and Retirement Disclosure [Abstract]
 
 
 
Defined contribution plans
$ 36 
$ 35 
$ 35 
Employee Benefit Plans (Employee Stock Purchase Program) (Details)
In Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Compensation and Retirement Disclosure [Abstract]
 
 
Price per share for the ESPP (percentage)
95.00% 
 
Stock issued during period, shares, ESPP (in shares)
76 
69 
Other Long-Term Liabilities (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Other Liabilities, Noncurrent [Abstract]
 
 
Deferred gains on sales of hotel properties
$ 363 
$ 367 
Deferred compensation plans
352 
333 
Hyatt Gold Passport Fund
296 
280 
Guarantee liabilities
124 
120 
Other accrued income taxes
100 
127 
Deferred income taxes
57 
59 
Defined benefit plans
20 
20 
Other
160 
141 
Total
$ 1,472 
$ 1,447 
Income Taxes (Domestic and Foreign Components of Pretax Income) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
U.S. income before tax
$ 180 
$ 119 
$ 493 
Foreign income before tax
109 
75 
32 
INCOME BEFORE INCOME TAXES
$ 289 
$ 194 
$ 525 
Income Taxes (Provision (Benefit) for Income Taxes from Continuing Operations) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
Current Federal
$ 66 
$ 134 
$ 164 
Current State
15 
18 
Current Foreign
21 
36 
Total Current
88 
173 
207 
Deferred Federal
(12)
(78)
(10)
Deferred State
(2)
(20)
(6)
Deferred Foreign
11 
(5)
(12)
Total Deferred
(3)
(103)
(28)
Total
$ 85 
$ 70 
$ 179 
Income Taxes (Effective Tax Rate Reconciliation) (Details)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
Statutory U.S. federal income tax rate
35.00% 
35.00% 
35.00% 
State income taxes—net of federal tax benefit
3.40% 
3.50% 
3.40% 
Impact of foreign operations (excluding unconsolidated hospitality ventures losses)
(5.40%)
(13.80%)
0.90% 
Foreign unconsolidated hospitality ventures
1.20% 
10.00% 
0.80% 
Playa foreign tax credit benefit
(2.60%)
0.00% 
0.00% 
Tax contingencies
(5.20%)
(1.50%)
(2.60%)
Change in valuation allowances
3.60% 
3.10% 
(1.00%)
General business credits
(0.80%)
(1.90%)
(0.40%)
Equity based compensation
0.40% 
(0.50%)
0.40% 
Other
(0.10%)
2.30% 
(2.40%)
Effective income tax rate
29.50% 
36.20% 
34.10% 
Income Taxes (Effective Tax Rate Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Income Tax Contingency
 
 
 
Effective income tax rate reconciliation, tax contingency, amount
 
 
$ 14 
Unrecognized tax benefits, increase resulting from prior period tax positions
(21)
69 
 
Effective income tax rate reconciliation, adjustments to deferred tax assets, amount
 
 
Reversal of Uncertain Tax Position
 
 
 
Income Tax Contingency
 
 
 
Effective income tax rate reconciliation, tax contingency, amount
15 
 
 
Unrecognized tax benefits, income tax penalties and interest expense
(4)
 
 
New Uncertain Tax Positions
 
 
 
Income Tax Contingency
 
 
 
Effective income tax rate reconciliation, tax contingency, amount
 
 
(5)
Statute Expiration on State Tax Filing Positions
 
 
 
Income Tax Contingency
 
 
 
Effective income tax rate reconciliation, tax contingency, amount
 
10 
13 
Expiration of Statutes in Foreign Jurisdictions
 
 
 
Income Tax Contingency
 
 
 
Effective income tax rate reconciliation, tax contingency, amount
 
 
Statute Expiration on State Tax Filing Positions
 
 
 
Income Tax Contingency
 
 
 
Unrecognized tax benefits, income tax penalties and interest expense
 
(5)
(7)
Transfer pricing positions
 
 
 
Income Tax Contingency
 
 
 
Unrecognized tax benefits, increase resulting from prior period tax positions
 
$ 7 
 
Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Deferred tax assets related to:
 
 
Employee benefits
$ 202 
$ 196 
Foreign and state net operating losses and credit carryforwards
46 
34 
Investments
55 
70 
Allowance for uncollectible assets
36 
36 
Intangibles
Deferred gains on sales of hotel properties
134 
142 
Hyatt Gold Passport Fund
81 
81 
Interest and state benefits
Unrealized losses
Other
54 
50 
Valuation allowance
(27)
(17)
Total deferred tax asset
588 
603 
Deferred tax liabilities related to:
 
 
Property and equipment
(224)
(258)
Investments
(28)
(33)
Intangibles
(14)
Unrealized gains
(39)
(45)
Prepaid expenses
(12)
(13)
Other
(15)
(12)
Total deferred tax liabilities
(332)
(361)
Net deferred tax assets
256 
242 
Deferred tax assets
313 
301 
Deferred tax liabilities—noncurrent
$ (57)
$ (59)
Income Taxes (Deferred Taxes Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Income Tax Contingency
 
 
Undistributed earnings of foreign subsidiaries
$ 504 
 
Deferred tax assets, operating loss carryforwards
46 
34 
Deferred tax assets, operating loss carryforwards, not subject to expiration
11 
 
Operating loss carryforwards, valuation allowance
27 
 
New Uncertain Tax Positions
 
 
Income Tax Contingency
 
 
Increase (decrease) in deferred income taxes
(34)
60 
State and Foreign
 
 
Income Tax Contingency
 
 
Operating loss carryforwards
164 
 
Deferred tax assets, operating loss carryforwards
36 
 
Federal and State
 
 
Income Tax Contingency
 
 
Deferred tax assets, tax credit carryforwards
10 
 
Not subject to expiration
 
 
Income Tax Contingency
 
 
Operating loss carryforwards
51 
 
Fixed asset related items
 
 
Income Tax Contingency
 
 
Increase (decrease) in deferred income taxes
$ (18)
$ 54 
Income Taxes (Unrecognized Taxes Narrative) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Income Tax Contingency
 
 
 
Unrecognized tax benefits
$ 86 
$ 110 
$ 40 
Unrecognized tax benefits that would impact effective tax rate
21 
 
Significant change in unrecognized tax benefits is reasonably possible, amount of unrecorded benefit
(3)
 
 
Unrecognized tax benefits, period increase (decrease)
(24)
70 
 
Unrecognized tax benefits, increase resulting from current period tax positions
13 
 
Unrecognized tax benefits, increase resulting from prior period tax positions
(21)
69 
 
Unrecognized tax benefits, reduction resulting from lapse of applicable statute of limitations
 
Unrecognized tax benefits, income tax penalties and interest accrued
14 
19 
 
Income tax examination, penalties and interest expense
 
Estimated income tax liability based on taxing authority’s assessment
140 
 
 
Estimated interest liability based on taxing authority’s assessment
41 
 
 
New Uncertain Tax Positions
 
 
 
Income Tax Contingency
 
 
 
Unrecognized tax benefits, increase resulting from prior period tax positions
 
60 
 
Transfer pricing positions
 
 
 
Income Tax Contingency
 
 
 
Unrecognized tax benefits, increase resulting from current period tax positions
 
 
Unrecognized tax benefits, increase resulting from prior period tax positions
 
 
Federal, State and Foreign
 
 
 
Income Tax Contingency
 
 
 
Income tax examination, penalties and interest expense
(5)
(3)
 
Statute Expiration on State and Foreign Tax Filing Positions
 
 
 
Income Tax Contingency
 
 
 
Income tax examination, penalties and interest expense
$ 9 
$ 5 
 
Income Taxes (Unrecognized Tax Benefits Rollforward) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Unrecognized Tax Benefits
 
 
Unrecognized tax benefits—beginning balance
$ 110 
$ 40 
Total increases—current period tax positions
13 
Total (decreases) increases—prior period tax positions
(21)
69 
Lapse of statute of limitations
(5)
(8)
Foreign currency fluctuation
(4)
Unrecognized tax benefits—ending balance
$ 86 
$ 110 
Commitments and Contingencies (Commitments, Guarantees Narrative) (Details)
12 Months Ended
Dec. 31, 2016
USD ($)
Dec. 31, 2015
USD ($)
Dec. 31, 2016
Total
USD ($)
Dec. 31, 2015
Total
USD ($)
Dec. 31, 2014
Total
USD ($)
Dec. 31, 2016
Performance Test Clause Guarantee
USD ($)
Dec. 31, 2015
Performance Test Clause Guarantee
USD ($)
Dec. 31, 2016
The Four Managed Hotels in France
Total
USD ($)
Dec. 31, 2016
The Four Managed Hotels in France
Total
EUR (€)
Dec. 31, 2015
The Four Managed Hotels in France
Total
USD ($)
Dec. 31, 2014
The Four Managed Hotels in France
Total
USD ($)
Dec. 31, 2016
Hotel in Seattle, Washington
USD ($)
Dec. 31, 2016
Hotel in Portland, Oregon
USD ($)
Loss Contingencies
 
 
 
 
 
 
 
 
 
 
 
 
 
Commitment to loan or investment
$ 378,000,000 
 
 
 
 
 
 
 
 
 
 
$ 50,000,000 
$ 160,000,000 
Performance guarantee initial term
 
 
 
 
 
 
 
7 years 
7 years 
 
 
 
 
Performance guarantee remaining term
 
 
 
 
 
 
 
3 years 6 months 
3 years 6 months 
 
 
 
 
Maximum Potential Future Payments
 
 
346,000,000 
 
 
 
 
308,000,000 
293,000,000 
 
 
 
 
Initial guarantee obligation liability
 
 
79,000,000 
97,000,000 
111,000,000 
66,000,000 
 
93,000,000 
106,000,000 
 
 
Guarantor obligations, carrying value, noncurrent
124,000,000 
120,000,000 
55,000,000 
81,000,000 
 
 
 
 
 
 
 
 
 
Guarantor obligations, carrying value, current
 
 
$ 24,000,000 
$ 16,000,000 
 
 
 
 
 
 
 
 
 
Commitments and Contingencies (Schedule of Guarantor Obligations) (Details) (USD $)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Guarantor Obligations
 
 
 
Amortization of initial guarantee obligation liability into income
$ (34,000,000)
$ (12,000,000)
$ (7,000,000)
Performance guarantee expense (income), net
63,000,000 
27,000,000 
23,000,000 
Foreign currency exchange, net
1,000,000 
(14,000,000)
(3,000,000)
Total
 
 
 
Guarantor Obligations
 
 
 
Beginning Balance
97,000,000 
111,000,000 
 
Initial guarantee obligation liability
9,000,000 
 
Amortization of initial guarantee obligation liability into income
(34,000,000)
(12,000,000)
 
Performance guarantee expense (income), net
63,000,000 
27,000,000 
 
Net (payments) receipts during the year
(55,000,000)
(18,000,000)
 
Foreign currency exchange, net
(1,000,000)
(11,000,000)
 
Ending Balance
79,000,000 
97,000,000 
 
The Four Managed Hotels in France |
Total
 
 
 
Guarantor Obligations
 
 
 
Beginning Balance
93,000,000 
106,000,000 
 
Initial guarantee obligation liability
 
Amortization of initial guarantee obligation liability into income
(33,000,000)
(10,000,000)
 
Performance guarantee expense (income), net
64,000,000 
28,000,000 
 
Net (payments) receipts during the year
(57,000,000)
(20,000,000)
 
Foreign currency exchange, net
(1,000,000)
(11,000,000)
 
Ending Balance
66,000,000 
93,000,000 
 
Other Performance Guarantees |
Total
 
 
 
Guarantor Obligations
 
 
 
Beginning Balance
4,000,000 
5,000,000 
 
Initial guarantee obligation liability
9,000,000 
 
Amortization of initial guarantee obligation liability into income
(1,000,000)
(2,000,000)
 
Performance guarantee expense (income), net
(1,000,000)
(1,000,000)
 
Net (payments) receipts during the year
2,000,000 
2,000,000 
 
Foreign currency exchange, net
 
Ending Balance
$ 13,000,000 
$ 4,000,000 
 
Commitments and Contingencies (Debt Repayment Guarantee) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Loss Contingencies
 
 
Guarantor obligations, carrying value, noncurrent
$ 124 
$ 120 
Debt Repayment Guarantees
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
576 
 
Maximum Exposure Net of Recoverability from Third Parties
259 
 
Guarantor obligations, carrying value, noncurrent
69 
39 
Debt Repayment Guarantees |
Hotel Property in Washington
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
215 
 
Maximum Exposure Net of Recoverability from Third Parties
 
Guarantor obligations, carrying value, noncurrent
35 
Debt Repayment Guarantees |
Hotel properties in India
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
177 
 
Maximum Exposure Net of Recoverability from Third Parties
177 
 
Guarantor obligations, carrying value, noncurrent
21 
27 
Debt Repayment Guarantees |
Hotel property in Brazil
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
80 
 
Maximum Exposure Net of Recoverability from Third Parties
40 
 
Guarantor obligations, carrying value, noncurrent
Debt Repayment Guarantees |
Hotel property in Minnesota
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
25 
 
Maximum Exposure Net of Recoverability from Third Parties
25 
 
Guarantor obligations, carrying value, noncurrent
Debt Repayment Guarantees |
Hotel property in Arizona
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
25 
 
Maximum Exposure Net of Recoverability from Third Parties
 
Guarantor obligations, carrying value, noncurrent
Debt Repayment Guarantees |
Hotel Properties in California
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
21 
 
Maximum Exposure Net of Recoverability from Third Parties
 
Guarantor obligations, carrying value, noncurrent
Debt Repayment Guarantees |
Hotel property in Colorado
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
 
Maximum Exposure Net of Recoverability from Third Parties
 
Guarantor obligations, carrying value, noncurrent
Debt Repayment Guarantees |
Other
 
 
Loss Contingencies
 
 
Maximum Potential Future Payments
25 
 
Maximum Exposure Net of Recoverability from Third Parties
 
Guarantor obligations, carrying value, noncurrent
Joint Venture |
Hotel properties in India
 
 
Loss Contingencies
 
 
Equity method investment, ownership percentage
50.00% 
 
Joint Venture |
Debt Repayment Guarantees |
Hotel properties in India
 
 
Loss Contingencies
 
 
Maximum Exposure Net of Recoverability from Third Parties
$ 89 
 
Commitments and Contingencies (Guarantee Liabilities Fair Value) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Guarantor Obligations
 
 
Guarantees, fair value disclosure
$ 231 
$ 179 
Guarantees |
Minimum
 
 
Guarantor Obligations
 
 
Fair value inputs, discount rate
10.60% 
9.50% 
Fair value inputs, long-term revenue growth rate
1.80% 
1.80% 
Fair value input, capitalization rate
7.00% 
6.50% 
Guarantor obligations, term
2 months 12 days 
3 months 18 days 
Guarantees |
Maximum
 
 
Guarantor Obligations
 
 
Fair value inputs, discount rate
12.60% 
12.60% 
Fair value inputs, long-term revenue growth rate
4.80% 
4.80% 
Fair value input, capitalization rate
10.00% 
10.00% 
Guarantor obligations, term
7 years 
5 years 
Commitments and Contingencies (Insurance, Collective Bargaining Agreements, Surety Bonds, and Letters Of Credit Narrative) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Loss Contingencies
 
 
Self Insurance reserve, current
$ 30 
$ 35 
Self insurance reserve, noncurrent
62 
57 
Letters of credit outstanding, amount
230 
 
Surety bonds
25 
 
Self Insurance Collateral
 
 
Loss Contingencies
 
 
Letters of credit outstanding, amount
$ 7 
 
United States
 
 
Loss Contingencies
 
 
US employees covered by collective bargaining agreements, percent
25.00% 
 
Stockholders' Equity and Comprehensive Loss (Narrative) (Details) (USD $)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Equity, Class of Treasury Stock [Line Items]
 
 
 
Stock repurchase program, authorized amount
$ 500,000,000 
$ 400,000,000 
$ 700,000,000 
Stock repurchased (in shares)
5,631,557 
13,199,811 
 
Share repurchase, value
272,000,000 
715,000,000 
445,000,000 
Percent repurchased (percentage)
4.00% 
9.00% 
 
Stock repurchase program, remaining authorized repurchase amount
357,000,000 
 
 
Treasury stock, shares, retired
 
195,423 
 
Treasury stock acquired, average cost per share
 
$ 43.41 
 
Treasury stock, value, acquired, cost method
 
$ 8,000,000 
 
Weighted Average
 
 
 
Equity, Class of Treasury Stock [Line Items]
 
 
 
Stock repurchased and retired during period per share value (in dollars per share)
$ 48.37 
$ 54.17 
 
Pritzker Family Business Interests
 
 
 
Equity, Class of Treasury Stock [Line Items]
 
 
 
Percent of Class B Common Stock owned (percentage)
83.60% 
 
 
Percent of outstanding shares of Common Stock (percentage)
58.10% 
 
 
Percent of total voting power, Common Stock (percentage)
80.10% 
 
 
Pritzker Family Business Interests |
Maximum
 
 
 
Equity, Class of Treasury Stock [Line Items]
 
 
 
Percent of Class A Common Stock owned (percentage)
0.10% 
 
 
Other Business Interests With Significant Ownership Percentage
 
 
 
Equity, Class of Treasury Stock [Line Items]
 
 
 
Percent of Class B Common Stock owned (percentage)
16.40% 
 
 
Percent of Class A Common Stock owned (percentage)
7.90% 
 
 
Percent of outstanding shares of Common Stock (percentage)
13.80% 
 
 
Percent of total voting power, Common Stock (percentage)
16.10% 
 
 
Stockholders' Equity and Comprehensive Loss (Accumulated Other Comprehensive Loss) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2016
Foreign currency translation adjustments
Dec. 31, 2015
Foreign currency translation adjustments
Dec. 31, 2016
Unrealized gains (losses) on AFS securities
Dec. 31, 2015
Unrealized gains (losses) on AFS securities
Dec. 31, 2016
Unrecognized pension cost
Dec. 31, 2015
Unrecognized pension cost
Dec. 31, 2016
Unrealized gains (losses) on derivative instruments
Dec. 31, 2015
Unrealized gains (losses) on derivative instruments
Dec. 31, 2016
Accumulated other comprehensive income (loss)
Dec. 31, 2015
Accumulated other comprehensive income (loss)
Dec. 31, 2013
Accumulated other comprehensive income (loss)
Increase (Decrease) in AOCI
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of period
$ 3,908 
$ 3,995 
$ 4,631 
$ 4,777 
$ (257)
$ (155)
$ 39 
$ 6 
$ (7)
$ (5)
$ (5)
$ (6)
$ (230)
$ (160)
$ (68)
Current period other comprehensive income (loss) before reclassification
 
 
 
 
(45)
(123)
(6)
33 
(2)
(50)
(91)
 
Amount reclassified from accumulated other comprehensive loss (a)
 
 
 
 
21 
21 
 
Balance, end of period
$ 3,908 
$ 3,995 
$ 4,631 
$ 4,777 
$ (299)
$ (257)
$ 33 
$ 39 
$ (7)
$ (7)
$ (4)
$ (5)
$ (277)
$ (230)
$ (68)
Stock Based Compensation (Income Tax Benefit Share Based Compensation) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Stock Appreciation Rights (SARs)
 
 
 
Income Tax Benefit Share Based Compensation
 
 
 
Employee service share-based compensation, tax benefit
$ 4 
$ 3 
$ 7 
Restricted Stock Units (RSUs)
 
 
 
Income Tax Benefit Share Based Compensation
 
 
 
Employee service share-based compensation, tax benefit
Performance Stock Units and Stock (PSUs and PSs)
 
 
 
Income Tax Benefit Share Based Compensation
 
 
 
Employee service share-based compensation, tax benefit
$ 0 
$ (1)
$ 2 
Stock-Based Compensation (Stock Appreciation Rights by Grant Date) (Details) (Stock Appreciation Rights (SARs), USD $)
1 Months Ended 12 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Feb. 28, 2015
Feb. 28, 2014
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
 
 
Granted (in shares)
45,710 
380,604 
39,401 
327,307 
924,424 
 
 
Grants in period, weighted-average fair value at grant date (in dollars per share)
$ 14.22 
$ 20.64 
$ 25.38 
$ 22.57 
$ 14.52 
$ 21.36 
$ 22.57 
Vesting Period
33.00% 
25.00% 
100.00% 
25.00% 
 
 
 
Vesting Start Month
March 2017 
March 2016 
March 2018 
March 2015 
 
 
 
25% annually
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
 
 
Granted (in shares)
878,714 
 
 
 
 
 
 
Grants in period, weighted-average fair value at grant date (in dollars per share)
$ 14.54 
 
 
 
 
 
 
Vesting Period
25.00% 
 
 
 
 
 
 
Vesting Start Month
March 2017 
 
 
 
 
 
 
50% annually
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
 
 
Granted (in shares)
 
41,373 
 
 
 
 
 
Grants in period, weighted-average fair value at grant date (in dollars per share)
 
$ 24.17 
 
 
 
 
 
Vesting Period
 
50.00% 
 
 
 
 
 
Vesting Start Month
 
March 2018 
 
 
 
 
 
Stock-Based Compensation (SAR Valuation Assumptions) (Details) (Stock Appreciation Rights (SARs), USD $)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Stock Appreciation Rights (SARs)
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
Exercise Price (in dollars per share)
$ 47.36 
$ 56.57 
$ 49.39 
Expected Life in Years
6 years 2 months 22 days 
6 years 3 months 22 days 
6 years 3 months 15 days 
Risk-free Interest Rate
1.55% 
1.63% 
1.93% 
Expected Volatility
27.72% 
35.39% 
44.32% 
Annual Dividend Yield
0.00% 
0.00% 
0.00% 
Stock-Based Compensation (Summary of SAR Activity) (Details) (Stock Appreciation Rights (SARs), USD $)
In Millions, except Share data, unless otherwise specified
1 Months Ended 12 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Feb. 28, 2015
Feb. 28, 2014
Dec. 31, 2016
Dec. 31, 2015
Stock Appreciation Rights (SARs)
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
 
 
 
 
 
 
Beginning balance (in shares)
 
 
 
 
3,876,937 
 
Granted (in shares)
45,710 
380,604 
39,401 
327,307 
924,424 
 
Exercised (in shares)
 
 
 
 
(325,339)
 
Forfeited or canceled (in shares)
 
 
 
 
(22,035)
 
Ending balance (in shares)
 
 
 
 
4,453,987 
3,876,937 
Exercisable (in shares)
 
 
 
 
2,855,153 
 
Share-based Compensation Arrangement by Share-based Payment Award, Weighted Average Exercise Price [Roll Forward]
 
 
 
 
 
 
Beginning balance, weighted average exercise price (in dollars per share)
 
 
 
 
$ 47.63 
 
Grants in period, weighted-average fair value at grant date (in dollars per share)
 
 
 
 
$ 47.36 
 
Exercises in period, weighted average exercise price (in dollars per share)
 
 
 
 
$ 43.09 
 
Forfeited or canceled, weighted average exercise price (in dollars per share)
 
 
 
 
53.32 
 
Ending balance, weighted average exercise price (in dollars per share)
 
 
 
 
$ 47.88 
$ 47.63 
Exercisable, weighted average exercise price (in dollars per share)
 
 
 
 
$ 47.09 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract]
 
 
 
 
 
 
Outstanding, weighted average remaining contractual term
 
 
 
 
5 years 3 months 
5 years 11 days 
Granted, weighted average contractual term
 
 
 
 
9 years 2 months 19 days 
 
Exercised, weighted average contractual term
 
 
 
 
2 years 29 days 
 
Forfeited or canceled, weighted average contractual term
 
 
 
 
5 years 15 days 
 
Forfeiture rate
 
 
 
 
0.00% 
 
Exercisable, weighted average contractual term
 
 
 
 
3 years 5 months 9 days 
 
Outstanding intrinsic value
 
 
 
 
$ 39 
 
Exercisable intrinsic value
 
 
 
 
$ 29 
 
Stock-Based Compensation (RSU Activity by Grant Date) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
1 Months Ended 12 Months Ended 1 Months Ended
Dec. 31, 2016
Restricted Stock Units (RSUs)
Mar. 31, 2016
Restricted Stock Units (RSUs)
Dec. 31, 2015
Restricted Stock Units (RSUs)
May 31, 2015
Restricted Stock Units (RSUs)
Mar. 31, 2015
Restricted Stock Units (RSUs)
Feb. 28, 2015
Restricted Stock Units (RSUs)
Sep. 30, 2014
Restricted Stock Units (RSUs)
Feb. 28, 2014
Restricted Stock Units (RSUs)
Dec. 31, 2016
Restricted Stock Units (RSUs)
Dec. 31, 2016
Cash Settled RSUs
Sep. 30, 2015
3,898
Restricted Stock Units (RSUs)
Sep. 30, 2015
8,576
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
 
 
 
 
 
 
 
Granted (in shares)
40,633 
444,629 
4,089 
23,746 
380,939 
29,278 
2,452 
376,328 
485,262 
 
3,898 
8,576 
Grants in period, weighted-average fair value at grant date (in dollars per share)
$ 56.60 
$ 47.36 
$ 48.90 
$ 58.95 
$ 56.27 
$ 59.77 
$ 61.17 
$ 49.39 
$ 48.13 
 
$ 51.30 
$ 51.30 
Total Value (in millions)
$ 2 
$ 21 
$ 0 
$ 1 
$ 21 
$ 2 
$ 0 
$ 19 
 
 
$ 0 
$ 0 
Vesting Period
4 years 
4 years 
4 years 
4 years 
4 years 
4 years 
4 years 
4 years 
 
 
3 years 
4 years 
Cash settled liability, nonvested awards
 
 
 
 
 
 
 
 
 
 
 
Allocated cash-settled share-based compensation expense
 
 
 
 
 
 
 
 
 
$ 0 
 
 
Stock-Based Compensation (Summary of RSU Activity) (Details) (Restricted Stock Units (RSUs), USD $)
In Millions, except Share data, unless otherwise specified
1 Months Ended 12 Months Ended
Dec. 31, 2016
Mar. 31, 2016
Dec. 31, 2015
May 31, 2015
Mar. 31, 2015
Feb. 28, 2015
Sep. 30, 2014
Feb. 28, 2014
Dec. 31, 2016
Rate
Restricted Stock Units (RSUs)
 
 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
 
 
 
 
 
 
 
 
 
Beginning balance (in shares)
 
 
 
 
 
 
 
 
1,014,574 
Granted (in shares)
40,633 
444,629 
4,089 
23,746 
380,939 
29,278 
2,452 
376,328 
485,262 
Vested (in shares)
 
 
 
 
 
 
 
 
(394,087)
Forfeited or canceled (in shares)
 
 
 
 
 
 
 
 
(89,572)
Ending balance (in shares)
1,016,177 
 
1,014,574 
 
 
 
 
 
1,016,177 
Share-based Compensation Arrangement by Share-based Payment Award, Weighted Average Date Fair Value [Roll Forward]
 
 
 
 
 
 
 
 
 
Beginning balance, nonvested weighted average (in dollars per share)
 
 
 
 
 
 
 
 
$ 50.02 
Granted, weighted-average (in dollars per share)
$ 56.60 
$ 47.36 
$ 48.90 
$ 58.95 
$ 56.27 
$ 59.77 
$ 61.17 
$ 49.39 
$ 48.13 
Vested, weighted average (in dollars per share)
 
 
 
 
 
 
 
 
$ 47.42 
Forfeited or canceled, weighted average (in dollars per share)
 
 
 
 
 
 
 
 
$ 49.78 
Ending balance, nonvested weighted average (in dollars per share)
$ 50.15 
 
$ 50.02 
 
 
 
 
 
$ 50.15 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract]
 
 
 
 
 
 
 
 
 
Forfeiture rate
 
 
 
 
 
 
 
 
3.00% 
Intrinsic value, nonvested
$ 56 
 
 
 
 
 
 
 
$ 56 
Stock-Based Compensation (Summary of PSU and PS Activity) (Details) (Performance Stock Units and Stock (PSUs and PSs), USD $)
In Millions, except Share data, unless otherwise specified
0 Months Ended 12 Months Ended
Jan. 1, 2016
Jan. 1, 2015
Jan. 1, 2014
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Performance Stock Units and Stock (PSUs and PSs)
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
 
PSUs and PSs Granted (in shares)
 
 
 
111,620 
146,902 
162,906 
Grants in period, weighted-average fair value at grant date (in dollars per share)
 
 
 
$ 47.36 
$ 56.27 
$ 49.39 
Performance Period
 
 
 
3 years 
3 years 
3 years 
Performance Period Start Date
January 1, 2016 
January 1, 2015 
January 1, 2014 
 
 
 
Stock granted, value, share-based compensation, forfeited
 
 
 
$ 8 
 
 
Intrinsic value
 
 
 
$ 6 
 
 
Stock-Based Compensation (Unearned Compensation) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
$ 25 
Stock Appreciation Rights (SARs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
Restricted Stock Units (RSUs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
15 
Performance Stock Units and Stock (PSUs and PSs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2017
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
12 
2017 |
Stock Appreciation Rights (SARs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2017 |
Restricted Stock Units (RSUs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2017 |
Performance Stock Units and Stock (PSUs and PSs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2018
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2018 |
Stock Appreciation Rights (SARs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2018 |
Restricted Stock Units (RSUs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2018 |
Performance Stock Units and Stock (PSUs and PSs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2019
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2019 |
Stock Appreciation Rights (SARs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2019 |
Restricted Stock Units (RSUs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2019 |
Performance Stock Units and Stock (PSUs and PSs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2020
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2020 |
Stock Appreciation Rights (SARs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2020 |
Restricted Stock Units (RSUs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
2020 |
Performance Stock Units and Stock (PSUs and PSs)
 
Share-based Compensation Arrangement by Share-based Payment Award
 
Future compensation expense
$ 0 
Related-Party Transactions (Leases Narrative) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Related Party Transaction
 
Future sublease income
$ 133 
Related Party
 
Related Party Transaction
 
Future sublease income
$ 4 
Related-Party Transactions (Equity Method Investments Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2015
Sep. 30, 2015
Jun. 30, 2015
Mar. 31, 2015
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Related Party Transaction
 
 
 
 
 
 
 
 
 
 
 
Management and franchise fees revenues
$ 116 
$ 110 
$ 115 
$ 107 
$ 107 
$ 103 
$ 112 
$ 105 
$ 448 
$ 427 
$ 387 
Minimum
 
 
 
 
 
 
 
 
 
 
 
Related Party Transaction
 
 
 
 
 
 
 
 
 
 
 
Equity method investment, ownership percentage
24.00% 
 
 
 
 
 
 
 
24.00% 
 
 
Maximum
 
 
 
 
 
 
 
 
 
 
 
Related Party Transaction
 
 
 
 
 
 
 
 
 
 
 
Equity method investment, ownership percentage
70.00% 
 
 
 
 
 
 
 
70.00% 
 
 
Equity Method Investments
 
 
 
 
 
 
 
 
 
 
 
Related Party Transaction
 
 
 
 
 
 
 
 
 
 
 
Management and franchise fees revenues
 
 
 
 
 
 
 
 
30 
26 
29 
Due (to) from related party
 
 
 
 
 
 
 
Equity Method Investments
 
 
 
 
 
 
 
 
 
 
 
Related Party Transaction
 
 
 
 
 
 
 
 
 
 
 
Guarantee fees
 
 
 
 
 
 
 
 
$ 5 
$ 2 
$ 2 
Related-Party Transactions (Class B Shares Repurchased) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Related Party Transaction
 
 
 
Stock repurchased (in shares)
5,631,557 
13,199,811 
 
Share repurchase, value
$ 272 
$ 715 
$ 445 
Percent repurchased (percentage)
4.00% 
9.00% 
 
Common Class B
 
 
 
Related Party Transaction
 
 
 
Stock repurchased (in shares)
1,881,636 
1,776,501 
 
Share repurchase, value
$ 100 
$ 105 
 
Percent repurchased (percentage)
1.00% 
1.00% 
 
Weighted Average
 
 
 
Related Party Transaction
 
 
 
Stock repurchased and retired during period per share value (in dollars per share)
$ 48.37 
$ 54.17 
 
Weighted Average |
Common Class B
 
 
 
Related Party Transaction
 
 
 
Stock repurchased and retired during period per share value (in dollars per share)
$ 53.15 
$ 58.91 
 
Related-Party Transactions (Class B Share Conversion) (Details) (USD $)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Common Class B
 
 
Related Party Transaction
 
 
Conversion of stock, shares converted (in shares)
16,884,117 
 
Common stock, par or stated value per share (in dollars per share)
$ 0.01 
$ 0.01 
Common Class A
 
 
Related Party Transaction
 
 
Common stock, par or stated value per share (in dollars per share)
$ 0.01 
$ 0.01 
Segment and Geographic Information (Summarized Consolidated Financial Information by Segment) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2015
Sep. 30, 2015
Jun. 30, 2015
Mar. 31, 2015
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Owned and leased hotels revenues
$ 514 
$ 519 
$ 559 
$ 516 
$ 530 
$ 500 
$ 540 
$ 509 
$ 2,108 
$ 2,079 
$ 2,246 
Management and franchise fees revenues
116 
110 
115 
107 
107 
103 
112 
105 
448 
427 
387 
Other revenues from managed properties
448 
448 
480 
457 
462 
440 
451 
433 
1,833 
1,786 
1,707 
Revenues
1,087 
1,088 
1,165 
1,089 
1,109 
1,053 
1,112 
1,054 
4,429 
4,328 
4,415 
Adjusted EBITDA
 
 
 
 
 
 
 
 
785 
750 
777 
Depreciation and amortization
 
 
 
 
 
 
 
 
342 
320 
354 
Capital expenditures
 
 
 
 
 
 
 
 
211 
269 
253 
Operating Segments |
Owned and Leased Hotels
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Owned and leased hotels revenues
 
 
 
 
 
 
 
 
2,119 
2,079 
2,246 
Adjusted EBITDA
 
 
 
 
 
 
 
 
516 
493 
523 
Depreciation and amortization
 
 
 
 
 
 
 
 
285 
277 
322 
Capital expenditures
 
 
 
 
 
 
 
 
200 
225 
208 
Operating Segments |
Americas Management and Franchising
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Management and franchise fees revenues
 
 
 
 
 
 
 
 
371 
354 
327 
Other revenues from managed properties
 
 
 
 
 
 
 
 
1,670 
1,641 
1,550 
Adjusted EBITDA
 
 
 
 
 
 
 
 
318 
300 
265 
Depreciation and amortization
 
 
 
 
 
 
 
 
18 
19 
18 
Capital expenditures
 
 
 
 
 
 
 
 
Operating Segments |
ASPAC management and franchising
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Management and franchise fees revenues
 
 
 
 
 
 
 
 
96 
91 
88 
Other revenues from managed properties
 
 
 
 
 
 
 
 
98 
87 
74 
Adjusted EBITDA
 
 
 
 
 
 
 
 
57 
55 
49 
Depreciation and amortization
 
 
 
 
 
 
 
 
Capital expenditures
 
 
 
 
 
 
 
 
Operating Segments |
EAME/SW Asia management and franchising
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Management and franchise fees revenues
 
 
 
 
 
 
 
 
65 
67 
77 
Other revenues from managed properties
 
 
 
 
 
 
 
 
65 
58 
53 
Adjusted EBITDA
 
 
 
 
 
 
 
 
33 
33 
43 
Depreciation and amortization
 
 
 
 
 
 
 
 
Capital expenditures
 
 
 
 
 
 
 
 
Operating Segments, Corporate and Other
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Other revenues from managed properties
 
 
 
 
 
 
 
 
30 
Revenues
 
 
 
 
 
 
 
 
43 
40 
75 
Adjusted EBITDA
 
 
 
 
 
 
 
 
(139)
(131)
(103)
Depreciation and amortization
 
 
 
 
 
 
 
 
33 
18 
Capital expenditures
 
 
 
 
 
 
 
 
43 
43 
Intersegment Eliminations
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
(98)
(89)
(105)
Adjusted EBITDA
 
 
 
 
 
 
 
 
Depreciation and amortization
 
 
 
 
 
 
 
 
Capital expenditures
 
 
 
 
 
 
 
 
Intersegment Eliminations |
Owned and Leased Hotels
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
11 
Intersegment Eliminations |
Americas Management and Franchising
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
75 
74 
88 
Intersegment Eliminations |
ASPAC management and franchising
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
Intersegment Eliminations |
EAME/SW Asia management and franchising
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
$ 10 
$ 13 
$ 15 
Segment and Geographic Information (Assets) (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2016
Dec. 31, 2015
Segment Reporting Information
 
 
Assets
$ 7,749 
$ 7,591 
Operating Segments |
Owned and Leased Hotels
 
 
Segment Reporting Information
 
 
Assets
5,393 
5,281 
Operating Segments |
Americas Management and Franchising
 
 
Segment Reporting Information
 
 
Assets
564 
464 
Operating Segments |
ASPAC management and franchising
 
 
Segment Reporting Information
 
 
Assets
128 
131 
Operating Segments |
EAME/SW Asia management and franchising
 
 
Segment Reporting Information
 
 
Assets
186 
234 
Operating Segments, Corporate and Other
 
 
Segment Reporting Information
 
 
Assets
$ 1,478 
$ 1,481 
Segment and Geographic Information (Schedule of Revenues from External Customers and Long-Lived Assets) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2015
Sep. 30, 2015
Jun. 30, 2015
Mar. 31, 2015
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Revenues from External Customers and Long-Lived Assets
 
 
 
 
 
 
 
 
 
 
 
Total revenues
$ 1,087 
$ 1,088 
$ 1,165 
$ 1,089 
$ 1,109 
$ 1,053 
$ 1,112 
$ 1,054 
$ 4,429 
$ 4,328 
$ 4,415 
Property and equipment, net, intangibles, net and goodwill
4,994 
 
 
 
4,707 
 
 
 
4,994 
4,707 
 
United States
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets
 
 
 
 
 
 
 
 
 
 
 
Total revenues
 
 
 
 
 
 
 
 
3,571 
3,494 
3,476 
Property and equipment, net, intangibles, net and goodwill
3,915 
 
 
 
3,562 
 
 
 
3,915 
3,562 
 
All Foreign
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets
 
 
 
 
 
 
 
 
 
 
 
Total revenues
 
 
 
 
 
 
 
 
858 
834 
939 
Property and equipment, net, intangibles, net and goodwill
$ 1,079 
 
 
 
$ 1,145 
 
 
 
$ 1,079 
$ 1,145 
 
Segment and Geographic Information (Reconciliation of Net Income attributable to Hyatt Hotels Corporation to EBITDA and a Reconciliation of EBITDA to Consolidated Adjusted EBITDA) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2015
Sep. 30, 2015
Jun. 30, 2015
Mar. 31, 2015
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Segment Reporting [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Net income attributable to Hyatt Hotels Corporation
$ 41 
$ 62 
$ 67 
$ 34 
$ 37 
$ 25 
$ 40 
$ 22 
$ 204 
$ 124 
$ 344 
Interest expense
 
 
 
 
 
 
 
 
76 
68 
71 
Provision for income taxes
 
 
 
 
 
 
 
 
85 
70 
179 
Depreciation and amortization
 
 
 
 
 
 
 
 
342 
320 
354 
EBITDA
 
 
 
 
 
 
 
 
707 
582 
948 
Equity (earnings) losses from unconsolidated hospitality ventures
 
 
 
 
 
 
 
 
(68)
64 
(25)
Stock-based compensation expense
 
 
 
 
 
 
 
 
25 
23 
49 
(Gains) losses on sales of real estate and other
 
 
 
 
 
 
 
 
23 
(9)
(311)
Asset impairments
 
 
 
 
 
 
 
 
17 
Other (income) loss, net
 
 
 
 
 
 
 
 
(2)
17 
Net income attributable to noncontrolling interests
 
 
 
 
 
 
 
 
Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA
 
 
 
 
 
 
 
 
100 
80 
80 
Adjusted EBITDA
 
 
 
 
 
 
 
 
$ 785 
$ 750 
$ 777 
Earnings Per Share (Schedule of the Calculation of Basic and Diluted Earnings Per Share) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2015
Sep. 30, 2015
Jun. 30, 2015
Mar. 31, 2015
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Numerator:
 
 
 
 
 
 
 
 
 
 
 
Net income
$ 41 
$ 62 
$ 67 
$ 34 
$ 37 
$ 25 
$ 40 
$ 22 
$ 204 
$ 124 
$ 346 
Net (income) loss attributable to noncontrolling interests
 
 
 
 
 
 
 
 
(2)
NET INCOME ATTRIBUTABLE TO HYATT HOTELS CORPORATION
$ 41 
$ 62 
$ 67 
$ 34 
$ 37 
$ 25 
$ 40 
$ 22 
$ 204 
$ 124 
$ 344 
Denominator:
 
 
 
 
 
 
 
 
 
 
 
Basic weighted average shares outstanding (in shares)
 
 
 
 
 
 
 
 
132,930,578 
142,814,868 
153,136,511 
Share-based compensation (in shares)
 
 
 
 
 
 
 
 
1,008,753 
1,184,455 
1,213,941 
Diluted weighted average shares outstanding (in shares)
 
 
 
 
 
 
 
 
133,939,331 
143,999,323 
154,350,452 
EARNINGS PER SHARE—Basic
 
 
 
 
 
 
 
 
 
 
 
Net Income -Basic (in dollars per share)
$ 0.31 
$ 0.48 
$ 0.50 
$ 0.25 
$ 0.26 
$ 0.18 
$ 0.28 
$ 0.15 
$ 1.53 
$ 0.87 
$ 2.26 
Net (income) loss attributable to noncontrolling interests - Basic (in dollars per share)
 
 
 
 
 
 
 
 
$ 0.00 
$ 0.00 
$ (0.01)
Net income attributable to Hyatt Hotels Corporation - Basic (in dollars per share)
 
 
 
 
 
 
 
 
$ 1.53 
$ 0.87 
$ 2.25 
EARNINGS PER SHARE—Diluted
 
 
 
 
 
 
 
 
 
 
 
Net Income- Diluted (in dollars per share)
$ 0.31 
$ 0.47 
$ 0.49 
$ 0.25 
$ 0.26 
$ 0.18 
$ 0.27 
$ 0.15 
$ 1.52 
$ 0.86 
$ 2.24 
Net (income) loss attributable to noncontrolling interests - Diluted (in dollars per share)
 
 
 
 
 
 
 
 
$ 0.00 
$ 0.00 
$ (0.01)
Net income attributable to Hyatt Hotels Corporation - Diluted (in dollars per share)
 
 
 
 
 
 
 
 
$ 1.52 
$ 0.86 
$ 2.23 
Earnings Per Share (Anti-dilutive Shares Issued) (Details)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Stock-Settled SARs
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share
 
 
 
Antidilutive securities excluded from the computations of diluted net income per share (in shares)
74,500 
1,500 
5,200 
Restricted Stock Units (RSUs)
 
 
 
Antidilutive Securities Excluded from Computation of Earnings Per Share
 
 
 
Antidilutive securities excluded from the computations of diluted net income per share (in shares)
900 
Other Income (Loss), Net (Reconciliation of Components in Other Income (Loss), Net) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Other Income and Expenses [Abstract]
 
 
 
Performance guarantee liability amortization
$ 34 
$ 12 
$ 7 
Depreciation recovery
25 
12 
Interest income
19 
11 
Foreign currency gains (losses), net
(14)
(3)
Realized losses
(6)
Performance guarantee expense, net
(63)
(27)
(23)
Other
(8)
(11)
Other income (loss), net
$ 2 
$ (5)
$ (17)
Subsequent Event (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended 0 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Jan. 17, 2017
Miraval Group
Subsequent Event
Jan. 26, 2017
Cranwell Spa & Golf Resort
Subsequent Event
Subsequent Event
 
 
 
 
 
Acquisitions, net of cash acquired
$ 492 
$ 3 
$ 548 
$ 215 
$ 20 
Quarterly Financial Information (Unaudited) (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2016
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Dec. 31, 2015
Sep. 30, 2015
Jun. 30, 2015
Mar. 31, 2015
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Quarterly Financial Information Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Owned and leased hotels
$ 514 
$ 519 
$ 559 
$ 516 
$ 530 
$ 500 
$ 540 
$ 509 
$ 2,108 
$ 2,079 
$ 2,246 
Management and franchise fees
116 
110 
115 
107 
107 
103 
112 
105 
448 
427 
387 
Other revenues
11 
11 
10 
10 
40 
36 
75 
Other revenues from managed properties
448 
448 
480 
457 
462 
440 
451 
433 
1,833 
1,786 
1,707 
Total revenues
1,087 
1,088 
1,165 
1,089 
1,109 
1,053 
1,112 
1,054 
4,429 
4,328 
4,415 
Direct and selling, general, and administrative expenses
1,027 
1,019 
1,063 
1,021 
1,047 
965 
998 
995 
4,130 
4,005 
4,136 
Net income
41 
62 
67 
34 
37 
25 
40 
22 
204 
124 
346 
Net income attributable to Hyatt Hotels Corporation
$ 41 
$ 62 
$ 67 
$ 34 
$ 37 
$ 25 
$ 40 
$ 22 
$ 204 
$ 124 
$ 344 
Net Income -Basic (in dollars per share)
$ 0.31 
$ 0.48 
$ 0.50 
$ 0.25 
$ 0.26 
$ 0.18 
$ 0.28 
$ 0.15 
$ 1.53 
$ 0.87 
$ 2.26 
Net Income- Diluted (in dollars per share)
$ 0.31 
$ 0.47 
$ 0.49 
$ 0.25 
$ 0.26 
$ 0.18 
$ 0.27 
$ 0.15 
$ 1.52 
$ 0.86 
$ 2.24 
Schedule II - Valuation and Qualifying Accounts (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Trade receivables—allowance for doubtful accounts
 
 
 
Valuation and Qualifying Accounts Disclosure
 
 
 
Balance at Beginning of Period
$ 15 
$ 13 
$ 11 
Additions Charged to Revenues, Costs and Expenses
Additions Charged to Other Accounts
Deductions
(3)
(3)
(3)
Balance at End of Period
18 
15 
13 
Financing receivables—allowance for losses
 
 
 
Valuation and Qualifying Accounts Disclosure
 
 
 
Balance at Beginning of Period
98 
100 
103 
Additions Charged to Revenues, Costs and Expenses
10 
10 
Additions Charged to Other Accounts
(2)
(9)
Deductions
(8)
(10)
(1)
Balance at End of Period
100 
98 
100 
Deferred tax assets—valuation allowance
 
 
 
Valuation and Qualifying Accounts Disclosure
 
 
 
Balance at Beginning of Period
17 
15 
21 
Additions Charged to Revenues, Costs and Expenses
10 
Additions Charged to Other Accounts
Deductions
(6)
Balance at End of Period
$ 27 
$ 17 
$ 15