For a Surestay Hotel By Best Western franchise, what is the definition of the 'Restricted Area'?
Surestay_Hotel_By_Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
Neither we nor any of our affiliates will open, or allow to open, a hotel or motel under your Hotel's Brand (i.e., SureStay by Best Western, SureStay Plus by Best Western or SureStay Studio by Best Western) within a radius of at least .25 miles around the Hotel (the "Restricted Area").
You will not receive an exclusive territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control. Our restrictions in the Restricted Area do not apply to any System Hotel under your Hotel's Brand that is, as of the effective date of the Franchise Agreement, already open, under construction or approved for development or opening. Our restrictions in the Restricted Area also do not apply to: (1) any hotel(s) or motel(s) under brands other than your Hotel's Brand and (2) any hotel(s), motel(s), or inn(s) that are part of a chain or group of four or more hotels, motels, or inns that we or our affiliates, as a result of a single transaction or group of related transactions, own, operate, acquire, lease, manage, franchise, license, or join through a merger, acquisition or marketing agreement (or otherwise), whether under their existing name or your Hotel's Brand name or any other name.
Except for our restrictions within your Hotel's Restricted Area, we and our affiliates have the right to engage in any other businesses of any nature, whether in the lodging or hospitality industry or not, and whether under the Brand, a competing brand, or otherwise, even if they compete with your Hotel, the System, or the Brand, and whether we or our affiliates start those businesses, or purchase, merge with, acquire, are acquired by, come under common ownership with, or associate with, such other businesses. We may also use or license to others all or part of the System; use the facilities, programs, services and/or personnel used in connection with the System in other businesses; use the System, the Brand and the Marks in other businesses; and add, alter, delete or otherwise modify elements of the System.
We are not restricted from soliciting or accepting reservations from customers located inside your Restricted Area. We and our affiliates may use other channels of distribution, such as the Internet,
catalog sales, telemarketing, or other direct marketing sales, to accept reservations under your Hotel's Brand and under other trademarks from customers located in your Restricted Area. We do not need to pay you any compensation for soliciting or accepting reservations from customers located inside your Restricted Area. You are not restricted from soliciting reservations from customers located outside of your Restricted Area, except that all of your advertising is subject to our advance written approval. While you may accept reservations from customers located outside of your Restricted Area, you may only do so through the approved reservation service we furnish to you. You may not use an individual hotel website, booking engine, extranet, channel manager or any other channel of distribution to accept reservations.
You have no options, rights of first refusal, or similar rights to acquire additional franchises. Continuation of your territorial rights does not depend on your achieving a certain sales volume, market penetration or other contingency. We may not alter your Restricted Area or territorial rights during the term of the Franchise Agreement without your written consent.
Source: Item 12 — Territory (FDD pages 60–61)
What This Means (2025 FDD)
According to Surestay Hotel By Best Western's 2025 Franchise Disclosure Document, the Restricted Area is defined as a radius of at least .25 miles around the franchisee's hotel. Within this area, neither Surestay Hotel By Best Western nor its affiliates will open, or allow to open, another hotel or motel under the same brand (SureStay by Best Western, SureStay Plus by Best Western, or SureStay Studio by Best Western). This restriction applies specifically to hotels of the same brand to prevent direct competition within a small geographic area.
However, there are several exceptions to this restriction. The Restricted Area limitations do not apply to existing Surestay Hotel By Best Western hotels that are already open, under construction, or approved for development as of the franchise agreement's effective date. Additionally, the restriction does not extend to hotels or motels operating under different brands, or to chains or groups of four or more hotels, motels, or inns that Surestay Hotel By Best Western or its affiliates may own, operate, acquire, lease, manage, franchise, license, or join through various business arrangements. This means a franchisee could face competition from other hotel brands or larger hotel groups even within their Restricted Area.
It is also important to note that Surestay Hotel By Best Western is not restricted from soliciting or accepting reservations from customers located inside the franchisee's Restricted Area through channels like the internet, catalog sales, telemarketing, or other direct marketing sales. The franchisee receives no compensation for these reservations. While franchisees can solicit reservations from customers outside their Restricted Area, they must do so through the approved reservation service provided by Surestay Hotel By Best Western and are prohibited from using individual hotel websites or other channels of distribution without prior written approval. This highlights the importance of the brand's reservation system and the franchisor's control over marketing and booking channels.