Supertel Hospitality Divests Assets - Analyst Blog
June 05 2012 - 6:30AM
Zacks
Supertel Hospitality,
Inc. (SPPR), a real estate investment trust (REIT),
recently announced that it has completed the sale of an
87-room Super 8 hotel in Sedalia, Missourifor $1.8 million. The
company utilized the proceeds to repay $1.7 million of associated
mortgage debt, while the remainder was used for general corporate
purposes.
Additionally, the company divested
another Super 8 hotel in Wichita, Kansas, for a total consideration
of $4.1 million. The 119-room hotel was purchased by the City of
Wichita to facilitate a highway expansion project. The
proceeds generated from the asset sale were utilized to retire the
$3.1 million mortgage loan on the property, and the balance was
used to reduce the company's short term borrowings.
With the divestiture of the Sedalia
Super 8 range of hotels, Supertel Hospitality continued its
transition from the economy hotel sector to a more upscale hotel
operator. Consistent with this transition, the company intends to
divest hotels that no longer fit into its long-term strategy.
During the first quarter 2012,
RevPAR (Revenue Par Available Room) for the company’s upper
mid-scale hotels increased 10.2 % to $40.11, aided by an 8.8%
increase in occupancy.
Based in Norfolk, Nebraska,
Supertel Hospitality specializes in the ownership of select-service
hotels. The company currently owns 96 hotels comprising 8,467 rooms
in 23 states.
Supertel Hospitality currently
retains a Zacks #2 Rank, which translates into a short-term Buy
rating. We also have a long-term Neutral recommendation on the
stock. One of its competitors, Ashford Hospitality Trust
Inc (AHT) holds a Zacks #5 Rank, which translates into a
short-term Strong Sell rating.
ASHFORD HOSPTLY (AHT): Free Stock Analysis Report
SUPERTEL HOSPIT (SPPR): Free Stock Analysis Report
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