What was the franchise fee revenue for Delta Hotels By Marriott in 2022?
Delta_Hotels_By_Marriott Franchise · 2025 FDDAnswer from 2025 FDD Document
eting and selling Marriott branded products and other products.
During the years ended December 31, 2024, 2023, and 2022, the Company transferred three, nine, and 12 franchise agreements to Marriott, respectively.
During the year ended December 31, 2024, the Company acquired and relicensed six franchise agreements from Marriott and its wholly owned subsidiary. The Company also entered into several new franchise agreements with franchisees in 2024.
Notes to Financial Statements (continued) ($ in Thousands)
2. Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements present the results of operations, financial position, and cash flows of the Company in accordance with generally accepted accounting principles in the U.S. ("U.S. GAAP"). Preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods, and the disclosures of contingent liabilities. Accordingly, ultimate results could differ from those estimates.
Revenue Recognition and Cost Reimbursements
Our revenues primarily include franchise fees, licensing fees, and cost reimbursements. For our franchised properties, we have a performance obligation to provide franchisees and operators a license to our hotel system intellectual property for use of certain of our brand names. As compensation for such services, we are typically entitled to initial application fees and ongoing royalty fees. Our ongoing royalty fees represent variable consideration, as the transaction price is based on a percentage of certain revenues of the properties, as defined in each contract. We recognize royalty fees on a monthly basis over the term of the agreement as those amounts become payable. Initial application and relicensing fees are fixed consideration payable upon submission of a franchise application or renewal and are recognized on a straight-line basis over the initial or renewal term of the franchise agreements.
Source: Item 7 — Franchisor reserves the right to challenge the applicability of any law that declares provisions in the Agreement void or unenforceable. (FDD pages 288–363)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, it is not possible to determine the specific franchise fee revenue earned by Delta Hotels By Marriott for the year 2022. While the document includes financial statements and discusses revenue recognition policies, it does not break down franchise fee revenue specifically for the Delta Hotels By Marriott brand. Instead, the document discusses revenue recognition policies related to franchise fees, licensing fees, and cost reimbursements. It mentions that initial application and relicensing fees are recognized on a straight-line basis over the term of the franchise agreements. Royalty fees are recognized monthly as a percentage of property revenues. Also, with the expansion into franchising legacy Starwood brands in 2024, the Company is charged a rate of 98% of the net revenue collected from franchise fees.
To gain clarity on the franchise fee revenue attributable to Delta Hotels By Marriott for 2022, a prospective franchisee should consider asking the franchisor directly for this specific financial information. Understanding the historical franchise fee revenue can provide valuable insights into the brand's financial performance and its contribution to the overall franchise system. This information is essential for making an informed investment decision.
Furthermore, the FDD includes information on various fees franchisees may encounter, such as the one-time set-up fee for Revenue Management Advisory Services, which is $3,500. However, this fee is distinct from the standard franchise fee revenue and relates to optional services. Therefore, while the FDD provides a general overview of revenue recognition and some specific fees, it lacks the specific data needed to answer the question about Delta Hotels By Marriott's franchise fee revenue in 2022.