TSX:HOT.DB.V - Post by User
Post by
EnergyStorage00on Aug 01, 2019 5:52pm
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Post# 29986460
News out + General outlook on AHIP
News out + General outlook on AHIP Completed 4 of 10 major renos in 2019.
They will not cut dividends assumings that they can acquire properties to get cash flow moving.
I agree with the strategy. It would be better to have a smaller group of Premium hotels and they will benifit from increased cashflow, etc.
In 2017 they purchased $400 million - 18 hotels in eastern USA at 50% leverage.
They will likely stay at around 50% which is normal in Canada but they mentioned bigger hotels so maybe they need to snap up 12-15 hotels which seems possible over a 3-6 months. I assume that they are already completing DD on hotels and have narrowed down the search to whatever they want.
There is plenty of risk here but they seem to be in control and are excited to moving exclusively to Premium branded hotels. Of course, this is a AMAZING move for shareholders but the street will want them to execute.
Execution risk is the only real risk that I see at this point.
Not buying more but will wait to see what happens as of September 30th and how quickly they expand the properties and complete renovations on current assets.