What is the royalty fee for a Sonesta Select Sonesta Essential franchise?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
We currently charge a loyalty program fee for your participation in the Sonesta Travel Pass program in the amount of 3% of your Hotel's Qualified Revenue (defined below) from guests participating in the Sonesta Travel Pass program, payable at the same time and in the same manner as Royalty Fees. We reserve the right, at any time, upon notice to you, to increase the loyalty program fee; provided, that the loyalty program fee that we impose shall not exceed 4.5% of your Hotel's Qualified Revenue. Companyowned and company-managed Brand Hotels may pay the loyalty program fee at a different rate, and not all franchised Network Hotels pay a uniform loyalty program fee. "Qualified Revenue" includes (a) Qualifying Rates (defined below), and (b) at our discretion, any other items charged to the loyalty program member not defined in subsection (a). "Qualifying Rates" include: (1) non-discounted rates; (2) standard corporate rates; (3) leisure rates; (4) government rates; (5) corporate and negotiated rates; (6) conference and meeting rates; and (7) individual hotel contract rates.
Source: Item 22 — CONTRACTS (FDD page 84)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, Sonesta Select Sonesta Essential franchisees must pay a royalty program fee for participation in the Sonesta Travel Pass program. This fee is currently 3% of the hotel's Qualified Revenue from guests participating in the program. This fee is payable at the same time and in the same manner as the Royalty Fees.
Sonesta Select Sonesta Essential retains the right to increase the loyalty program fee, but it cannot exceed 4.5% of the hotel's Qualified Revenue. It's important to note that company-owned and company-managed Brand Hotels may pay the loyalty program fee at a different rate, and not all franchised Network Hotels pay a uniform loyalty program fee.
Qualified Revenue includes Qualifying Rates and, at Sonesta Select Sonesta Essential's discretion, any other items charged to the loyalty program member. Qualifying Rates encompass non-discounted rates, standard corporate rates, leisure rates, government rates, corporate and negotiated rates, conference and meeting rates, and individual hotel contract rates. This means the royalty fee is calculated on a broad range of revenue sources, providing a steady income stream for Sonesta Select Sonesta Essential.