What is the initial fee for a Sonesta Select Sonesta Essential franchise, for both conversion and new construction?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 7: ESTIMATED INITIAL INVESTMENT SONESTA SELECT (Note 1) – 125 ROOMS]
| Type Of Expenditure | Amount Conversion | New Construction | Method of Payment | When Due | To Whom Payment Is To Be Made |
|---|---|---|---|---|---|
| Initial Fee (Note 2) | $65,000 | $65,000 | Lump sum | Upon your signing of the Franchise Agreement | Us |
| Onboarding | $5,000 | $5,000 | Lump sum | As arranged | Us |
| Administration Fee | |||||
| (Note 3) |
[Item 7: ESTIMATED INITIAL INVESTMENT SONESTA SELECT (Note 1) – 125 ROOMS]
| Type Of Expenditure | Amount Conversion | New Construction | Method of Payment | When Due | To Whom Payment Is To Be Made |
|---|---|---|---|---|---|
| Initial Fee (Note 2) | $45,000 | $45,000 | Lump sum | Upon your signing of the Franchise Agreement | Us |
| Onboarding | $2,500 | $2,500 | Lump sum | As arranged | Us |
| Administration Fee | |||||
| (Note 3) |
Note 2 – The Initial Fee of $65,000 for a Sonesta Select-branded hotel is based on the assumption that your Hotel has 125 Guest Rooms and therefore must pay the minimum Initial Fee. The Initial Fee of $45,000 for a Sonesta Essential-branded hotel is based on the assumption that your Hotel has 80 Guest Rooms and therefore must pay the minimum Initial Fee.
Note 1 – We have estimated costs based on a 125-room Sonesta Select-branded hotel. None of the fees payable to us are refundable. Amounts payable to third parties are nonrefundable unless the supplier agrees otherwise.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT SONESTA SELECT (Note 1) – 125 ROOMS (FDD pages 36–46)
What This Means (2025 FDD)
According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, the initial franchise fee varies depending on the brand. For a Sonesta Select-branded hotel, which is based on an assumption of 125 guest rooms, the initial fee is $65,000, whether it is a conversion or new construction. For a Sonesta Essential-branded hotel, which is based on an assumption of 80 guest rooms, the initial fee is $45,000 for both conversion and new construction. This fee is paid in a lump sum upon signing the Franchise Agreement and is payable to Sonesta Select Sonesta Essential.
It is important to note that these initial fees are based on the minimum number of rooms for each brand. The document specifies that none of the fees payable to Sonesta Select Sonesta Essential are refundable. This means that once the Franchise Agreement is signed and the initial fee is paid, the franchisee cannot get this money back, even if the deal falls through or the hotel does not open.
Prospective franchisees should carefully consider these initial fees and ensure they have sufficient capital before signing the Franchise Agreement. They should also be aware that there are other initial investment costs, such as onboarding fees, revenue management system installation, and property management system installation fees, which can significantly increase the total initial investment. Understanding the full scope of required payments upfront is crucial for financial planning and risk assessment.