WASHINGTON, D.C. HOTEL BUSINESS. has learned that MeriStar Hotels and Resorts is currently executing a restructuring of its corporate staff.
The company is expected to officially announce the changes May 8 when it releases its first quarter 2001 earnings.
According to a source close to the company, MeriStar is cutting 10% of its corporate staff, with one-third of the personnel changes taking place in the IT department alone.
Of the 10% of employees being cut from their corporate positions at MeriStar, more than one-third are expected to be reassigned to new positions in the field.
The changes are said to be a result of MeriStar s lease buybacks, which stem from the REIT Modernization Act that took affect in January 2001.
Now that MeriStar (the REIT) is able to own the properties outright (after the RMA) and its management subsidiary, MeriStar Hotels & Resorts is managing the properties, the company is looking to shift resources and expenses to best reflect these changes, said the inside source.
It is likely that MeriStar would have made such changes earlier in the year, said the source, had it not been for its pending merger with American Skiing Co., which fell through last month due to soft economic and industry conditions. (5/4/01) Shannon McMullen