How is the CapEx Account contribution determined for The Standardx during the 12-month period beginning on the first anniversary of the Opening Month?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
---------------| | Preamble | Franchisor entity | Hyatt Franchising, L.L.C., a Delaware limited liability company | | Preamble | Site | [Address] | | 2.5 | Extension Fee | Ten Thousand Dollars ($10,000) | | 4.1 | Approved Management Company as of Effective Date (if any) | [Management Company Name] or [N/A] | | 4.7 | CapEx Account | (a) three percent (3%) of the Hotel's total operating revenue (as determined in accordance with the Uniform System of Accounts) accrued during the calendar twelve (12)-month period beginning on the first (1st) day of the Opening Month; (b) four percent (4%) of the Hotel's total operating revenue (as determined in accordance with the Uniform System of Accounts) accrued during the calendar twelve (12)-month period beginning on the first (1st) anniversary of the first (1st) day of the Opening Month; and (c) five percent (5%) of the Hotel's total operating revenue (as determined in accordance with the Uniform System of Accounts) accrued during the balance of the Term | | 5.1 | Pre-opening | Five Hundred Dollars ($500) multiplied by the number of | | | marketing | guest rooms at the Hotel | | 6.1(a) | Initial Application Fee amount | $ | | 6.1(a) | Additional Application Fee | Five Hundred Dollars ($500) multiplied by the number of additional guest rooms at the Hotel above 200 total guest rooms | | 6.1(a) | Current PIP Fee | Ten Thousand Dollars ($10,000) | | 6.1(b) | IT Project Management Services Fee amount | $ | | 6.1(c) | Design Services Review Fee amount | $ | | Section Reference | Subject | Applicable Term | |----------------------|------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Item 18 — OTHER INCOME (LOSS), NET (FDD pages 187–399)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, the CapEx Account contribution for the 12-month period beginning on the first anniversary of the opening month is set at a specific percentage of the hotel's total operating revenue. Specifically, The Standardx requires a contribution of four percent (4%) of the Hotel's total operating revenue during this period. This revenue is determined in accordance with the Uniform System of Accounts.
This means that a franchisee must deposit 4% of the hotel's total operating revenue into the CapEx Account each month during the second year of operation. This money is intended to be used for capital expenditures and upgrades to keep the hotel compliant with The Standardx's standards. The franchisee maintains control of this account.
It is important to note that while the CapEx Account is intended to assist with necessary capital expenditures, the franchisee may be required to spend more than the amount available in the account to fulfill upgrade and other obligations. Franchisees should carefully project their operating revenue and potential capital expenditure needs to ensure they can meet these financial obligations.