But what I find most compelling is that in 2011, the 1099 data from NAREIT shows 100% of the distribution was ordinary incomeLooking at their latest supplemental, for the last 5 qtrs 6/30/2011 to 6/30/2012, their common distribution is higher than the Net Income. Any other thoughts on HPT? Management: They are managed by RMR. There is a bit of conflict of interest and this is going to reflect in valuation. Also, you may have noticed the TA deal and recent hotel purchases are where RMR acted on both sides of the transaction.Property: The travel centers dilute, confuse their profile and impacts the valuation.In the last 1 year they have converted 10% of their loans to floating rate, thus reducing their interest expense significantly, given their average int rate is around 6.5% and these loans certainly cost < 2%, thee is a 4.5% benefit or in other words their total interest went down by .5%. They certainly help the short-term but creates issues long-term. Having said that, they also recently issued a 10 year notes at 5%, which is a positive.Have you looked at their renovation spending for last few years? I haven't but I am wondering whether they cut their investments in renovations and which is showing up in the income.
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