In a Caption By Hyatt franchise transfer, what renovations or modifications can Hyatt require the transferee or franchisee to perform on the hotel?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
- (g) the transferee (if the transfer is of this Agreement) or Franchisee (if the transfer is of a Controlling Ownership Interest in Franchisee or one of its Controlling Owners) agrees (regardless of cost) to renovate, remodel and/or expand the Hotel, which may include structural alterations, adding or replacing improvements and FF&E, and otherwise modifying the Hotel, as Hyatt requires to comply with the Hotel System and System Standards then applicable for new similarly situated Brand Hotels, subject to Reasonable Deviations; and
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to the 2025 Caption By Hyatt Franchise Disclosure Document, as a condition of transfer, Hyatt can require the transferee or franchisee to renovate, remodel, and/or expand the hotel. These changes may include structural alterations, adding or replacing improvements and FF&E (furniture, fixtures, and equipment), and otherwise modifying the hotel.
These renovations and modifications must be made to comply with the Caption By Hyatt Hotel System and System Standards then applicable for new, similarly situated Brand Hotels. However, these are subject to Reasonable Deviations, which suggests some flexibility depending on the specific circumstances of the hotel and its market.
This requirement means that a potential transferee or the existing franchisee may need to invest significant capital to bring the hotel up to current Caption By Hyatt standards. It is crucial for prospective franchisees to understand the scope and cost of these potential renovations before completing a transfer. They should discuss with Hyatt what specific upgrades might be required and factor those costs into their financial projections. This ensures that the transfer is financially viable and aligns with their investment goals.