I am looking at all REITS right now because prices are low and yields are high. SPPR has a nice yield, but I do have a some concerns:
1. SPPR appears to be very aggressive in buying hotels. Will that be a problem in the future if they are not able to control and maintain all properties? 2. The properties appear to be the economy (low to mid) priced hotels. I would think that could be good going into a economic slowdown, but I have not read any statistics on this. Does anyone know if these hotels will do better or worse than higher priced hotels?
Do the members of this group have any thoughts on these matters?
Recommend you visit their website they have a jan 2008 hospitality industry and analysts report on SPPR outlook.
My recommendation is that if your own DD indicates this is a buy, then establish a position now, then add on weakness.
IMO, SPPR will be announcing additional acquistions, increased dividend, sales of properties that aren't cutting it this year, and improved operating margins as last years acquisitions are completely assimiliated. All this will lead to at the minimum: a stable PPS with increased yield.