Is the transfer fee paid to Sonesta Select Sonesta Essential for a franchise transfer refundable?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
- (e) Assignor pays or causes to be paid to us a transfer fee of
Source: Item 23 — RECEIPTS (FDD pages 84–261)
What This Means (2025 FDD)
According to Sonesta Select Sonesta Essential's 2025 Franchise Disclosure Document, the transfer fee paid by the assignor for a franchise transfer is non-refundable. The FDD states that the transfer fee is considered fully earned by Sonesta Select Sonesta Essential upon payment.
This means that if a franchisee decides to sell or transfer their franchise to a new owner, the transfer fee they pay to Sonesta Select Sonesta Essential will not be returned to them, regardless of whether the transfer is ultimately completed or not. This is a standard practice in franchising, as the franchisor incurs costs in reviewing and approving the transfer.
Prospective franchisees should factor this non-refundable fee into their financial planning when considering a Sonesta Select Sonesta Essential franchise. It's important to understand that this fee is separate from any other amounts due to Sonesta Select Sonesta Essential and covers the franchisor's administrative costs associated with the transfer process.