Does Hyatt Franchising, L.L.C. own hotel premises that they lease to The Standardx franchisees?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Approve a site for the Hotel that meets our requirements. We do not provide any site selection assistance or specify an area within which you may look for a site. We do not own hotel premises and lease them to franchisees. In determining whether to approve a site, we consider, among other things, demographic characteristics, traffic patterns, parking, visibility, allowed signage, the predominant character of the neighborhood, competition from other lodging facilities in the area, the nature of other businesses near the site, and other commercial characteristics (including the purchase price or rental obligations and other lease terms) and the proposed site's size, appearance, and other physical characteristics. You may not develop a Brand Hotel at a site that we do not approve. We and you will not sign a Franchise Agreement until you have located and we have approved the Hotel's site. If you are converting an existing hotel from another brand to the Hotel System, we will inspect the hotel and prepare a PIP to provide details on our upgrade requirements. Each Comfort Letter Party must sign a comfort letter or similar agreement that we reasonably specify. (Sections 2.1 and 2.7 of Franchise Agreement)
Source: Item 11 — Franchisor's Assistance, Advertising, Computer Systems, and Training (FDD pages 48–64)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, Hyatt Franchising, L.L.C. does not own hotel premises that they lease to franchisees. The FDD specifies that as part of the site approval process, The Standardx does not provide site selection assistance or specify an area within which a franchisee may look for a site. The responsibility for finding a suitable location rests solely with the franchisee.
This arrangement means that prospective The Standardx franchisees must independently secure a location that meets the franchisor's requirements. This includes evaluating demographic characteristics, traffic patterns, parking, visibility, signage, neighborhood character, competition, nearby businesses, commercial characteristics like purchase price or rental obligations, and the site's physical attributes. The Standardx must approve the site before a Franchise Agreement can be signed.
The franchisee bears the risk and responsibility of negotiating lease terms or purchasing the property. This differs from some franchise systems where the franchisor may own or lease the property and then sublease it to the franchisee. Franchisees should carefully consider the costs and risks associated with securing a suitable site, as this can significantly impact the overall investment and profitability of the The Standardx franchise.