What is the geographic limit for conducting the business of a Sonesta Simply Suites hotel?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
You agree to use the Premises only for your Hotel, and, once it opens for business, to continuously operate your Hotel in accordance with this Agreement for the duration of the Term. You agree not to conduct the business of your Hotel at any location other than the Premises. You may not promote or sell any products or services, whether directly or indirectly, through or on the Internet, the World Wide Web, or any other similar proprietary or common carrier electronic delivery system, except as expressly set forth herein or as set forth in the Brand Manual, as hereinafter defined.
- B. No Exclusivity and Reservation of Rights. We do not grant any, and you have no, exclusive rights or territorial protection around your Hotel.
We (and our affiliates) retain the right at all times during and after the Term to engage in any and all activities that we (and they) deem appropriate and that have not been expressly granted to you in this Agreement, wherever and whenever we (and they) desire, and whether or not such activities compete with your Hotel, including the right, anywhere in the world, to do any of the following:
(1) establish and operate, and allow others to establish and operate Brand Hotels at any location on such terms and conditions we deem appropriate;
(2) establish, operate, and license others to establish and operate, anywhere in the world other than the Premises, Network Hotels and other businesses that offer products and services which are identical or similar to the products and services offered by Brand Hotels under any trade names, trademarks, service marks and commercial symbols;
(3) purchase, merge, acquire, be acquired or affiliate with one or more existing franchise networks, chains or any other businesses, including Competitive Businesses (defined below), regardless of the location of such chains' or businesses' facilities, and to operate, franchise or license those businesses under the Marks or any other marks following the purchase, merger, acquisition or affiliation, regardless of the location of those businesses (or the franchisees or licensees of those businesses);
Source: Item 22 — CONTRACTS (FDD pages 79–80)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, a franchisee must operate their hotel solely at the specified premises. The agreement explicitly states that franchisees cannot conduct the business of their Sonesta Simply Suites hotel at any location other than the designated premises. This restriction extends to promoting or selling products or services through the internet or similar electronic systems, unless expressly permitted in the agreement or the Brand Manual.
Sonesta Simply Suites does not offer franchisees any exclusive rights or territorial protection around their hotel. The brand retains the right to engage in activities they deem appropriate, including establishing and operating other Brand Hotels at any location and under any terms they consider suitable. This includes the right to establish, operate, and license Network Hotels and other businesses offering similar products and services anywhere in the world, except at the franchisee's specific premises.
This lack of exclusivity means that Sonesta Simply Suites can establish competing hotels or businesses near a franchisee's location. They can also purchase, merge, or affiliate with existing franchise networks, regardless of the location of those businesses. This aspect of the franchise agreement carries significant implications for prospective franchisees, as it highlights the potential for direct competition from the franchisor or other franchisees. A prospective franchisee should consider the possible impact of this lack of territorial protection on their hotel's performance and profitability.