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Ashford Hospitality Trust, Inc. Message Board

  • run35ok run35ok Dec 31, 2008 8:59 AM Flag

    Reflection on AHT

    A few months back I made some controversial statements about AHT when the stock was going from 8 to 2 in a matter of weeks. I was bombarded with sarcastic responses because I ventured to say that the smart money knew a lot more than the little lemmings here. They were dumping while the lemmings were buying. I was lucky. I bought at 2-3. Now we have the facts that were not available at that time.

    In their infinite wisdom, AHT managers were giving mezzanine loans (2nd mortgages) to extended stay hotel operators who were on the edge of destruction and desperate. We now know that AHT may lose in the order of $150M because REVpar for those hotels are in worse shape than what AHT owns. The statement by AHT that they are in discussions is a prelude to writing off the investments.

    While they were busy losing on mezzanine and flooridor loans, AHT smart managers were busy maxiing out on lines of credit to build their cash positions for 2 reasons: one to keep their paychecks and bonus fat, and second to pay the dividend on preferred stock and bonds, or to keep property mortgages current (Now, we don't want the banks to take the cow, do we?). Forget the common. That's for the lemmings. As for the 5M shares of common that management owns, I wonder if that came from options? I wonder. Could some lemming here dig into how they got 5M shares?

    All in all, a very sad story for the little fries here to get fried.

    And they called those managers smart! Let's see. Can anyone here bring about their removal from office? After all, we can all agree that they have done a sh*@tty job when it comes to protecting the shareholders' interest. The stock did go from 8 to 1.

    Yes, a very sad story.

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AHT
11.58+0.14(+1.22%)Aug 22 4:03 PMEDT

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