factual

What is excluded from the definition of 'Gross Rooms Revenue' for a Sonesta Simply Suites hotel?

Sonesta_Simply_Suites Franchise · 2025 FDD

Answer from 2025 FDD Document

Excluded from Gross Rooms Revenue are separate charges to guests for food and beverage (including room service); vending machine receipts; actual telephone charges for calls made from a guest room; key forfeitures and entertainment (including Internet fees and commissions); allowances for any Guest Room rebates and overcharges; gratuities to employees or service charges levied in lieu of such gratuities, which are payable to employees; and applicable federal, state and local sales, occupancy and use taxes collected from guests.

Source: Item 22 — CONTRACTS (FDD pages 79–80)

What This Means (2025 FDD)

According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, Gross Rooms Revenue is a crucial figure, as it is used to calculate royalty fees and the brand promotion fee. However, not all revenue generated at the hotel is included in this calculation.

Specifically, the following are excluded from Gross Rooms Revenue: separate charges to guests for food and beverage (including room service); vending machine receipts; actual telephone charges for calls made from a guest room; key forfeitures and entertainment (including Internet fees and commissions); allowances for any Guest Room rebates and overcharges; gratuities to employees or service charges levied in lieu of such gratuities, which are payable to employees; and applicable federal, state and local sales, occupancy and use taxes collected from guests.

For a prospective Sonesta Simply Suites franchisee, understanding these exclusions is important for accurately calculating and reporting Gross Rooms Revenue, which directly impacts the fees owed to the franchisor. Excluding these items can lower the royalty and brand promotion fees, but it's crucial to maintain accurate records and adhere to the franchisor's definitions to avoid any discrepancies or non-compliance charges.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.