What are the 'Conversion or Construction Obligations' for a Sonesta Select Sonesta Essential hotel?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
nd or that requires the approval or consent of any other person.
2. PREMISES, CONVERSION OR CONSTRUCTION OBLIGATIONS AND OPENING OF YOUR HOTEL.
A. Generally. You may operate your Hotel only at the Premises. You have selected the site for the Premises. You must cause your Hotel to meet the mandatory specifications, standards, operating procedures, and rules (the "Brand Standards") that we prescribe for equipping, furnishing, supplying, and maintaining Brand Hotels in accordance with this Agreement.
Our acceptance of the Premises indicates only that we believe that the site meets our current acceptable criteria, which have been established for our own purposes. Applying criteria that have appeared effective with other sites and premises might not accurately reflect the potential for all sites and premises, and demographic or other factors included in or excluded from our criteria could change, even after our approval of the Premises or, if applicable your conversion of your existing hotel to a Brand Hotel, altering the potential of a site and premises. The uncertainty and instability of these criteria are beyond our control, and we are not responsible if a site and premises we approve fail to meet your expectations. You acknowledge and agree that your acceptance of the Franchise at the Premises is based on your own independent investigation of the site's suitability for a Brand Hotel.
- B. Conversion of Your Hotel. If you are converting an existing hotel into a Brand Hotel, you will execute the Conversion Rider, attached hereto as Exhibit D-1, simultaneously with this Agreement.
- C. New Construction. If you are constructing a new Brand Hotel, you will execute the New Construction Rider, attached hereto as Exhibit D-2, simultaneously with this Agreement.
- D. Technology Standards & Computer System. You will purchase or license, install, utilize, and maintain at your Hotel, at your sole cost, and at then-current pricing or fees as provided by us or the applicable third-party provider, all software, hardware, services, and equipment that we or our affiliates license, sell to, or require you to purchase or lease in operation of your Hotel (the "Computer System"). "Computer System" shall include any data processing systems specified or required by us or our affiliates for use by Brand Hotels, including, but not limited to, guest check-in, reservation (the "Central Reservation System"), property management (the "Property Management System"), revenue management (the "Revenue Management System") or other statistical reporting systems. You will pay a one-time reservation implementation fee ranging from $650 to $1,745 upon your Hotel becoming active in the Central Reservation System which is charged by our third-party Central Reservation System provider but invoiced and collected by us. You will be responsible for all costs incurred in fulfilling your obligations hereunder, including, without limitation, costs and fees for data circuit charges, and supplies used in the operation and maintenance of the Computer System. You also agree to maintain all specified points of high-speed Internet connection. You agree to make Wi-Fi and an in-room entertainment system available to your Hotel's guests, free of charge to them and to install, subject to our specifications, a branded internet landing page for your guests' access to Wi-Fi. We may modify specifications for, and components of, the Computer System. Our modification of specifications for the Computer System, and other technological developments or events, might require you to purchase, lease, or license new or modified computer hardware or software and to obtain service and support for the Computer System. You agree to incur the costs of obtaining the computer hardware and software comprising the Computer System (or additions and modifications) and required service or support, regardless of whether those costs are fully amortizable over this Agreement's remaining term. We have no obligation to reimburse you for any Computer System costs. Within 60 days after we advise you of changes to the Computer System, you agree to implement such changes, and if necessary, procure any additional equipment, components, hardware, or software we designate. You must at all times during the Term ensure that your Computer System, as modified, meets our Brand Standards and functions properly.
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, a franchisee may operate a Sonesta Select Sonesta Essential hotel only at an approved premises that meets the brand's standards for equipping, furnishing, supplying, and maintaining the hotel. The franchisor's acceptance of the premises indicates only that they believe the site meets their criteria, which are established for their own purposes. The franchisee acknowledges that their acceptance of the franchise at the premises is based on their own independent investigation of the site's suitability for a Sonesta Select Sonesta Essential hotel.
If converting an existing hotel to a Sonesta Select Sonesta Essential hotel, the franchisee will execute a Conversion Rider simultaneously with the Franchise Agreement. If constructing a new Sonesta Select Sonesta Essential hotel, the franchisee will execute the New Construction Rider simultaneously with the Franchise Agreement. The franchisee is responsible for ensuring the hotel and construction work comply with all applicable laws, bylaws, statutes, ordinances, orders, rules, regulations, permits, licenses, authorizations, directions, and requirements of all governments and governmental authorities, including environmental, zoning, building, and life safety codes.
The franchisor has the right to participate in all progress meetings during the construction work and to have access to the hotel during reasonable business hours to inspect the hotel, its construction, renovations, completion, furnishing, and equipping. However, the franchisor is not obligated to participate in such progress meetings or to inspect the hotel, and their participation and inspection is not a representation of the adequacy of the construction, the structural integrity, or the sufficiency of mechanical and electrical systems for the hotel or the construction work. Upon completion of the construction work and as a condition to opening the hotel under the Marks, the franchisee's architect, general contractor, or other certified professional must provide the franchisor with a certificate stating that the as-built premises comply with the Americans with Disabilities Act and its architectural guidelines and all state and local codes for accessible facilities.
The franchisee must obtain all necessary insurance, including builder's risk, and all permits and certifications required for lawful construction of the hotel, including zoning, access, sign, building permits, and fire certifications, and if requested by the franchisor, the franchisee will provide copies of all such certificates of insurance, permits, and certifications. Construction of the hotel must commence within 12 months of the effective date of the Franchise Agreement, unless a different date is specified in Exhibit A to the Franchise Agreement. If construction does not commence by this date, the franchisee must submit a written request to extend the construction commencement date, along with a payment of $5,000. If the franchisor approves the extension request, they will provide a written notice of approval, setting the new construction commencement date.