What does 'Change of Ownership' refer to regarding an existing Embassy Suites By Hilton hotel?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchise Agreement you sign will provide for new development, conversion, change of ownership, or re-licensing, depending on your situation. These situations are referred to in this Disclosure Document as "New Development," "Conversion," "Change of Ownership," and "Relicensing," respectively. New Development refers to new building construction. Conversion refers to the renovation of an existing building to bring it into compliance with our Brand Standards so that it may operate as a Brand hotel. Change of Ownership refers to the transfer of ownership or control of an existing Brand hotel to a new owner. Re-licensing refers to the grant of a new franchise after the expiration of a prior franchise for the same hotel. Adaptive Reuse is also a category shown on the Franchise Application. It is a form of Conversion.
Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 8–15)
What This Means (2025 FDD)
According to the 2025 Embassy Suites By Hilton Franchise Disclosure Document, 'Change of Ownership' refers to the transfer of ownership or control of an existing Embassy Suites By Hilton hotel to a new owner. This is one of several situations covered by the Franchise Agreement, along with new development, conversion, and re-licensing.
For a prospective franchisee, understanding the 'Change of Ownership' provision is crucial if they are considering purchasing an existing Embassy Suites By Hilton location rather than building a new one or converting an existing building. This means the franchisee would be taking over an already operational hotel, which could offer advantages such as established customer base and immediate revenue generation.
However, it's important to note that as a new owner, the franchisee will be responsible for ensuring the hotel continues to meet Embassy Suites By Hilton's brand standards and may be required to make additional investments to maintain or improve the property. The Franchise Agreement will outline the specific obligations and expectations for a 'Change of Ownership' scenario, so careful review is essential.