What is the nonrefundable initial fee for a Sonesta Select Sonesta Essential branded hotel?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
ou will pay to us, as damages for failure to open on time and not as a penalty, our then-current Opening Date rescheduling fee (currently up to $5,000).
3. FEES.
A. Initial Fee. You must pay us at the time of your execution of this Agreement a nonrefundable initial fee in the amount of: (i) for a Sonesta Select -branded hotel, the greater of $65,000 or $500 per Guest Room (defined below), or (ii) for a Sonesta Essential -branded hotel, the greater of $45,000 or $500 per Guest Room (the "Initial Fee"). The Initial Fee must be paid to us by cashier's check, bank certified check, wire transfer, ACH, or credit card.
"Guest Room" means each rentable unit in your Hotel generally used for overnight guest accommodations, the entra
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to the 2025 FDD, the initial fee for a Sonesta Select Sonesta Essential branded hotel is nonrefundable and due upon execution of the franchise agreement. For a Sonesta Select-branded hotel, the initial fee is the greater of $65,000 or $500 per guest room. For a Sonesta Essential-branded hotel, the initial fee is the greater of $45,000 or $500 per guest room.
The number of guest rooms is defined as each rentable unit in the hotel generally used for overnight guest accommodations, with each entrance controlled by a single key. Adjacent guest rooms with connecting doors that can be rented separately are considered separate guest rooms. The initial number of approved guest rooms is identified on Exhibit A of the Franchise Agreement.
The initial fee must be paid via cashier's check, bank certified check, wire transfer, ACH, or credit card. This fee compensates Sonesta Select Sonesta Essential for granting the franchise and providing initial services. It is typical in the franchise industry for initial fees to be non-refundable, as they cover the franchisor's initial expenses in setting up the franchisee.