Under what condition regarding the condemnation of a Crowne Plaza hotel will the License automatically terminate?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event that the Hotel or a substantial part thereof is to be taken, such that continued operation of the Hotel in accordance with the Standards is no longer possible, IHG will give due and prompt consideration, without any obligation by either party, to changing the site of the Hotel to a nearby location selected by Licensee, and approved by IHG, as promptly as reasonably possible and in any event within four months of the taking; provided, that Licensee has promptly filed an application to change the Location of the Hotel. Such application would not require payment to IHG of any additional franchise application fee. If the condemnation of all or any material part of the Hotel building occurs in the last two years of the License Term, this License shall automatically terminate effective upon the date of the taking.
Source: Item 23 — Receipts (FDD pages 100–424)
What This Means (2025 FDD)
According to Crowne Plaza's 2025 Franchise Disclosure Document, the license agreement will automatically terminate if the condemnation of all or any material part of the hotel building occurs within the last two years of the license term. This termination becomes effective on the date of the taking.
This provision means that if a governmental entity exercises its right of eminent domain to take the Crowne Plaza hotel property (or a significant portion of it) near the end of the franchise agreement, the agreement will end immediately. This could impact a franchisee's ability to recoup their investment if the condemnation occurs late in the term, as they would lose the right to operate the hotel.
However, Crowne Plaza will give due and prompt consideration, without any obligation by either party, to changing the site of the Hotel to a nearby location selected by Licensee, and approved by IHG, as promptly as reasonably possible and in any event within four months of the taking; provided, that Licensee has promptly filed an application to change the Location of the Hotel. Such application would not require payment to IHG of any additional franchise application fee.