NORFOLK, NE -- (Marketwire) -- 04/02/12 -- Supertel Hospitality, Inc. (NASDAQ: SPPR), a real estate investment trust (REIT) which currently owns 98 hotels in 23 states, today announced that it has entered into an agreement to acquire the 100 room Hilton Garden Inn in Solomons Island, Maryland for $11.5 million, or $115 thousand per key, excluding closing costs and fees. The hotel opened in 2007, and includes 3,650 square feet of function space, and a restaurant. It is located on Dowell Road in historic Solomons Island and is 2.5 miles from the Naval Air Station Patuxent River. The hotel is Supertel's second property in Solomons Island, as it also owns the 60 room Comfort Inn Beacon Marina. The closing of the acquisition is subject to customary closing conditions. Supertel expects the closing to occur in the second quarter of 2012.
"This Hilton Garden Inn is a stabilized first generation, premium select-service hotel, and is an especially meaningful purchase for Supertel as it represents the beginning of the next phase of our plan to move the company methodically up the chain scale spectrum," said Kelly Walters, Supertel's president and chief executive officer. "This particular upscale property has been superbly managed and maintained by Cherry Cove Hospitality Management, LLC since it opened and we plan to retain the managers who made it a success. This is our second hotel in this area and we know this market to be one that possesses a diverse group of consistent demand generators augmented by one of the strongest median household incomes in the country."
The purchase price of $11.5 million represents a forward capitalization rate of approximately 9.0 to 9.5 percent. Supertel expects to fund the purchase with capital from its recent preferred equity raise coupled with a conservative amount of fixed rate financing on a five to ten year term.
About Supertel Hospitality, Inc.
As of April 2, 2012, Supertel Hospitality, Inc. (NASDAQ: SPPR) owns 98 hotels comprising 8,622 rooms in 23 states. The company focuses primarily on the limited-service hotel segment, which does not offer food and beverage service. The company's hotel portfolio includes Baymont Inn, Comfort Inn/Comfort Suites, Days Inn, Guest House Inn, Hampton Inn, Holiday Inn Express, Key West Inns, Masters Inn, Quality Inn, Ramada Limited, Savannah Suites, Sleep Inn, Super 8 and Supertel Inn. 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.
Ms. Krista Arkfeld
Director of Corporate Communications