What is the Sonesta Simply Suites franchisee's obligation if the hotel is damaged by fire or other casualty?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- B. Casualty. You must immediately inform us if your Hotel, or any part thereof, is damaged by fire or other casualty.
If such damage or destruction is substantial and material, affecting over fifty percent (50%) of the Guest Rooms of your Hotel, and the reasonable estimated cost to repair the damage exceeds the fair market value of your Hotel, you shall immediately notify us and elect, by written notice to us within sixty (60) days following the date of the casualty, to repair or rebuild your Hotel in accordance with the Brand Standards or to terminate this Agreement ("Casualty Termination Notice").
Any such Casualty Termination Notice shall be effective sixty (60) days after receipt of such notice by us.
In the event you fail to send a Casualty Termination Notice, you shall be deemed to have elected to repair or rebuild your Hotel in accordance with the Brand Standards.
If you elect to repair the damage, you will complete restoration within 180 days after the casualty.
We may terminate this Agreement by written notice to you if you fail to rebuild your Hotel to the Brand Standards and recommence operations within the time periods specified in this Section.
If you elect to repair the damages done to your Hotel pursuant to this Section, we reserve the right to require you to repair both the damaged and undamaged portions of your Hotel to our then-current Brand Standards.
In the event you terminate this Agreement due to casualty, you will not be obligated to pay Lost Revenue Damages.
Source: Item 22 — CONTRACTS (FDD pages 79–80)
What This Means (2025 FDD)
According to Sonesta Simply Suites' 2025 Franchise Disclosure Document, if the hotel incurs damage from fire or another casualty, the franchisee must immediately inform Sonesta Simply Suites. If the damage is substantial and material, affecting over 50% of the guest rooms, and the estimated repair cost exceeds the hotel's fair market value, the franchisee has 60 days to notify Sonesta Simply Suites in writing whether they elect to repair/rebuild the hotel to Brand Standards or terminate the Franchise Agreement.
If the franchisee fails to send a Casualty Termination Notice within 60 days, they are considered to have elected to repair or rebuild the hotel according to Brand Standards. Should the franchisee choose to repair the damage, they must complete the restoration within 180 days after the casualty. Sonesta Simply Suites retains the right to require the franchisee to repair both the damaged and undamaged portions of the hotel to meet the then-current Brand Standards.
Sonesta Simply Suites can terminate the Franchise Agreement if the franchisee fails to rebuild the hotel to Brand Standards and recommence operations within the specified time. If the franchisee terminates the agreement due to the casualty, they will not be obligated to pay Lost Revenue Damages. This outlines the franchisee's responsibilities and options in the event of significant property damage, as well as Sonesta Simply Suites' rights regarding the restoration and adherence to Brand Standards.