When is the Comfort Letter Processing Fee due for a Crowne Plaza franchise?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
• Fail third quarter = Assess | Quarterly Assessment appears on invoice (Payable to SCH) | Note 24 |
| TYPE OF FEE | AMOUNT | DUE DATE | REMARKS |
|---|---|---|---|
| $2,500 /standard • Fail fourth quarter = Assess $5,000/standard • Capped at $5,000 per quarter | |||
| Employee Engagement Survey | $7 to $12 per employee each year | Annually (Payable to designated third party provider) | Note 25 |
| F&B POS Support | $45.00 per workstation per month | Monthly (Payable to an approved supplier) | Note 7 |
| Comfort Letter Processing Fee | $2,500 for the preparation and processing of any mezzanine, replacement or subsequent comfort letters after the initial senio |
Source: Item 6 — OTHER FEES (FDD pages 31–51)
What This Means (2025 FDD)
According to Crowne Plaza's 2025 Franchise Disclosure Document, the Comfort Letter Processing Fee is due upon demand and is payable to Holiday. The fee amounts to $2,500 for the preparation and processing of any mezzanine, replacement, or subsequent comfort letters after the initial senior lender letter. However, IHG (InterContinental Hotels Group) may waive this fee at its discretion.
This fee is not a standard, recurring fee but rather a conditional one that arises if a franchisee requires additional comfort letters beyond the initial one. Comfort letters are typically required by lenders to provide assurance regarding the financial stability and brand support of the franchise system. The fact that IHG may waive this fee provides some flexibility for franchisees, although it is not guaranteed.
For a prospective Crowne Plaza franchisee, it's important to understand the circumstances under which comfort letters might be needed and to factor in the potential cost of $2,500 per letter. It would be prudent to discuss with IHG the likelihood of needing subsequent comfort letters and the criteria they use for waiving the fee. Understanding these factors can help in financial planning and managing potential costs associated with financing the franchise.