What is the monthly Insurance fee for a Sonesta Simply Suites franchise, and what other insurance-related costs might be incurred?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
ies. See Note 9. |
| TYPE OF FEE | AMOUNT | DUE DATE | REMARKS (Note 1) |
|---|---|---|---|
| American Hotel & Lodging Association Fee (“AHLA”) | $4.50 per room per year | Payable monthly by the 20th day of the following month | You will be enrolled automatically as a member of the AHLA each year, but you will be given an opportunity, on an annual basis, to opt out of participation. While enrolled, you will pay this fee to us, which we will remit to the AHLA. |
| Reservation System Maintenance Fee: Future Rate and Inventory | $250 – 1st occurrence $500 – 2nd occurrence $1,000 – per occurrence thereafter | As billed | We charge this fee if you fail to meet our performance standard of maintaining on the Central Reservation System at least 12 months of your advance room rates and inventory at all times. See Note 9. |
| Reservation System Maintenance Fee: Central Reservation System Services | $150 per occurrence | As billed | You incur this fee if you request additional assistance with performing Central Reservation System maintenance. See Note 9. |
| Alternative Payment Fee | $25 processing fee per each occurrence for paper check. 3.5% processing fee for credit card payment. | As billed | This fee will be charged if you request that we process payments using a method other than direct debit. |
| Guest Room Addition Fee | The greater of $400 per additional Guest Room or $5,000 | When you submit an application to add Guest Rooms | If you add or construct additional Guest Rooms at your Hotel after signing the Franchise Agreement, you will pay us this fee. |
Source: Item 6 — OTHER FEES (FDD pages 25–36)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, there is no explicitly stated monthly insurance fee. However, franchisees are required to pay an American Hotel & Lodging Association (AHLA) fee of $4.50 per room per year, which is payable monthly. This fee is remitted to the AHLA. While enrollment in AHLA is automatic, franchisees have the option to opt out annually.
Beyond the AHLA fee, the FDD outlines other potential costs related to default remedies. If a Sonesta Simply Suites franchisee defaults on their agreement, they are responsible for reimbursing Sonesta Simply Suites for all costs and expenses incurred to remedy the default. These expenses may include attorneys' fees (including fees for in-house attorneys), court costs, and other non-legal fees reasonably incurred to protect Sonesta Simply Suites or its affiliates.
Additionally, the FDD mentions that franchisees must maintain insurance coverage as specified in the Franchise Agreement (Item 8), but it does not detail the specific amounts or monthly costs associated with this insurance. Prospective franchisees should carefully review Item 8 of the FDD and consult with Sonesta Simply Suites to understand the full scope of required insurance coverage and associated costs. Understanding these insurance requirements is crucial for accurately assessing the overall investment and operational expenses of a Sonesta Simply Suites franchise.