What additional nonrefundable fee does Embassy Suites charge for converting an existing hotel or re-licensing?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
If you apply to convert an existing hotel to a Brand hotel or apply for a change of ownership or other re-licensing, we charge an additional nonrefundable PIP fee to determine the upgrading requirements for the hotel.
| Type of Expenditure | Amount | Method of Payment | When due | To whom payment is to be made |
|---|---|---|---|---|
| Property Improvement Plan | $0 to $10,000 | Lump sum | Before we | Us |
| Fee (Note 2) | prepare PIP | |||
| Franchise Application Fee | $100,000 | Lump sum | With | Us |
| (Note 1) | Application | |||
| TOTAL (Note 23) | $50,082,670 to $82,170,820 THESE FIGURES DO NOT INCLUDE REAL ESTATE COSTS, MARKET STUDY, INSURANCE, INTEREST OR SEPARATELY IDENTIFY THE COSTS OF IMPROVEMENTS UNDER A CONVERSION, RE-LICENSING OR CHANGE OF OWNERSHIP LICENSE. |
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 41–45)
What This Means (2025 FDD)
According to Embassy Suites' 2025 Franchise Disclosure Document, if a franchisee applies to convert an existing hotel to an Embassy Suites brand or applies for a change of ownership or other re-licensing, Embassy Suites charges an additional nonrefundable Property Improvement Plan (PIP) fee. This fee is used to determine the upgrading requirements for the hotel. The PIP fee ranges from $0 to $10,000. This fee is paid in a lump sum before Embassy Suites prepares the PIP. Payment is made directly to Embassy Suites.
This fee is in addition to the Franchise Application Fee, which is $100,000. The estimated initial investment for an Embassy Suites franchise, including the Property Improvement Plan fee, ranges from $50,082,670 to $82,170,820. However, this total does not include real estate costs, market study, insurance, interest, or separately identify the costs of improvements under a conversion, re-licensing, or change of ownership license.
Prospective franchisees should note that the PIP fee is nonrefundable, regardless of whether the conversion or re-licensing is ultimately approved. It is essential to factor this cost into the initial investment and conduct thorough due diligence to assess the potential upgrading requirements and associated costs before proceeding with the conversion or re-licensing process.