When is the onboarding fee due for a Sonesta Select Sonesta Essential franchise?
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 3 – If you are acquiring an existing Brand Hotel, you will pay us a reduced onboarding administration fee of $2,000.
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 onboarding fee for a new construction Sonesta Select hotel with 125 rooms is $5,000. The onboarding fee for a new construction Sonesta Essential hotel with 80 rooms is $2,500. The method of payment is a lump sum, and the fee is due as arranged with Sonesta Select Sonesta Essential. However, if you are acquiring an existing Brand Hotel, you will pay a reduced onboarding administration fee of $2,000.
This means that as a prospective franchisee, you'll need to coordinate with Sonesta Select Sonesta Essential to determine the specific payment schedule for the onboarding fee. The timing may depend on various factors, such as the progress of your hotel's development or conversion, and the specific agreements you reach with the franchisor.
It's important to note that none of the fees payable to Sonesta Select Sonesta Essential are refundable. Amounts payable to third parties are nonrefundable unless the supplier agrees otherwise. Therefore, understanding the payment terms and schedule is crucial to managing your initial investment effectively. Franchisees should clarify these arrangements during the franchise agreement negotiation to avoid any misunderstandings or unexpected financial burdens.