Attached files
file | filename |
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8-K - CONDOR HOSPITALITY TRUST, INC. | sppr8k_mar9.htm |
For
Immediate Release
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Contact:
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Supertel
Hospitality
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Connie
Scarpello
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Jerry
Daly, Carol McCune
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Chief
Financial Officer
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Daly
Gray
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cscarpello@supertelinc.com
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(Media
Contact)
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Kelly
Walters
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703.435.6293
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President
and Chief Executive Officer
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jerry@dalygray.com
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402.371.2520
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Supertel
Hospitality Announces Non-Cash Asset Impairment
Charge
of Approximately $24.1 Million
NORFOLK,
Neb., March 8, 2010 – Supertel Hospitality, Inc. (NASDAQ: SPPR), a real estate
investment trust (REIT) which owns 114 hotels in 23 states, today announced that
its 2009 results will be impacted by substantial non-cash impairment charges of
approximately $24.1 million. As a result of management’s decision in
the fourth quarter to sell an additional 18 hotels, the company recorded
impairment charges of approximately $12.4 million on 12 of these
hotels. Further, the company recorded impairment charges of
approximately $10.9 million for six hotels where the expected period to be held
was reduced from approximately 10 years to three years. The non-cash
impairment charge represents the excess of book value of the 18 hotels over
their estimated fair value. Through the 2009 third quarter, the
company had announced non-cash impairment charges of approximately
$843,000.
The
company’s conclusion to recognize the non-cash impairment charges reflects the
new management team’s strategy in today’s changed economic conditions to
re-evaluate its hotels and the length of time the company anticipates holding
its properties based on new and more stringent criteria,
including a strategic review of debt service capability, estimated return on
investment, and local market conditions. As of December 31, 2009,
following the re-evaluation, Supertel has 19 hotels classified as held for sale
and listed in discontinued operations. At September 30, 2009, Supertel had three
hotels classified as held for sale. In the 2009 fourth quarter, two
of these hotels were sold and an additional 18 were classified as held for
sale. The company plans to announce its fourth quarter and full-year
2009 earnings later in March.
“Among
the evaluation criteria was a determination that we were too weighted in the
economy sector, where our REIT cost structure makes it more difficult to compete
with individual owner/operators, who tend to impact this segment,” said Kelly
Walters, Supertel president and CEO. “Economy hotels will remain an
important part of our portfolio, but over time we expect to reduce their
weighting in favor of mid-scale properties.” Proceeds from the sale
of the hotels will be used to retire debt and to provide working
capital.
About
Supertel Hospitality, Inc.
As of
March 8, 2010, Supertel Hospitality, Inc. (NASDAQ: SPPR) owns 114 hotels
comprised of 9,929 rooms in 23 states. The company’s hotel portfolio
includes Super 8, Comfort Inn/Comfort Suites, Hampton Inn, Holiday Inn Express,
Supertel Inn, Days Inn, Ramada Limited, Guest House Inn, Sleep Inn, Savannah
Suites, Masters Inn, Key West Inn and Baymont Inn. This
diversity enables the company to participate in the best practices of each of
these respected hospitality partners. The company specializes in
limited-service hotels. For more information or to make a hotel
reservation, visit www.supertelinc.com.
Certain
matters within this press release are discussed using forward-looking language
as specified in the Private Securities Litigation Reform Act of 1995, and, as
such, may involve known and unknown risks, uncertainties and other factors that
may cause the actual results or performance to differ from those projected in
the forward-looking statement. These risks are discussed in the company’s
filings with the Securities and Exchange Commission.