To whom are the contingency costs paid for a Sonesta Select Sonesta Essential hotel?

According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, the term "Contingencies" refers to unanticipated construction cost overruns and other unanticipated expenses. The FDD does not specify to whom these contingency costs are paid.

As a prospective franchisee, it is important to understand all potential costs associated with opening a Sonesta Select Sonesta Essential hotel. Contingency costs can arise from various unforeseen issues during construction or the initial phase of operations. These costs can significantly impact your initial investment and profitability.

To gain a clearer understanding of these potential expenses, a prospective franchisee should ask the franchisor for a detailed explanation of what types of expenses are covered under "Contingencies", how the amount is determined, and to whom these payments are typically made. Understanding the historical frequency and average amount of contingency expenses for other franchisees can also be helpful in financial planning.