Who pays the fee for The Standardx Comfort Letter?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
ary surrender by Franchisee of the Franchise (to the extent that Hyatt is aware in advance of any such voluntary surrender) and (b) furnish Lender with copies of default notices sent by Hyat
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, either the franchisee or the lender is responsible for paying the Comfort Letter fee. Specifically, the FDD states that "Franchisee or Lender shall pay to Hyatt a fee in the amount of Two Thousand Five Hundred Dollars ($2,500) in connection with this Comfort Letter, prior to or simultaneous with its execution." This fee covers Hyatt's costs for entering into the agreement.
In situations where a lender requires a Comfort Letter to protect their investment in the hotel, it is a point of negotiation between the franchisee and the lender as to who will ultimately bear the cost. The Comfort Letter provides certain assurances to the lender, such as Hyatt's agreement to provide the lender with notice of any franchisee defaults and an opportunity to cure those defaults. This protection is valuable to the lender, but the franchisee also benefits from securing financing for their The Standardx hotel.
Prospective The Standardx franchisees should clarify with Hyatt the exact timing and process for payment of this fee to ensure compliance and avoid any delays in finalizing the Comfort Letter. Understanding who is responsible for the fee and factoring it into the overall project budget is an important step in the franchise process.