Charge hurts Supertel performance

Supertel Hospitality Inc. of Norfolk, Neb., said Wednesday its 2009 financial performance was hampered by $24.1 million in noncash charges because of the reduced value of its motels.

The company said the charges stem mostly from a decision late last year to sell 18 of its motels. One was sold in January, the company said, and the others remain for sale. Proceeds from the sales will go to reduce debt. Supertel has 114 motels in 23 states.

Supertel is to report its results for 2009 later this month. The recession and sagging economy have cut occupancy and room rates in the lodging industry nationwide.

Kelly Walters, who became Supertel’s president and CEO in April, said the decision to take the charge reflects a new strategy designed to meet economic conditions, such as intense competition from owner-operated economy motels.

While the economy market will remain part of its portfolio, Walters said, the company will increase its emphasis on motels in the "mid-scale" market.

« Money

Share