Canopy by HiltonFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Canopy by Hilton franchise does not disclose total investment in its current FDD, including a $85K franchise fee and an ongoing 5.0% royalty[2]. The 2023 FDD does not disclose unit-level revenue (no Item 19). Verdict grade: B. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2023 FDD issuance
Overview
- Investment
- $85K
- 2nd pct Lodging
- Avg gross sales
- N/A
- 2nd pct Lodging
- Royalty
- 5.0%
- 4th pct Lodging
- Units
- 26
- 24th pct Lodging
- SBA default
- N/A
Quick verdict · Lodging · color = vs category peers
Green = >15% above Lodging avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Franchised units fell from 26 to 20 over 3 years. Investigate why operators are leaving.
Bottom line
- Total investment $85K including a $85K franchise fee, 5.0% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict B (Above Average) with a risk score of 54/100.
- 4 units terminated last reporting year (15.4% of the system). Ask existing franchisees why.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Hilton Franchise Holding LLC
- Parent company
- Hilton Domestic Operating Company Inc.
- Ultimate parent
- Hilton Worldwide Holdings Inc.
- CEO title
- Chief Executive Officer and President
- Christopher J. Nassetta
- Incorporated in
- DE
- HQ
- 7930 Jones Branch Drive, Suite 1100, McLean, Virginia 22102
- Auditor
- Cherry Bekaert LLP
- Audited financials
- Franchisor revenue
- $883.3M
- vs $1.2B prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Franchisees operate upscale, boutique-style hotel properties under the Canopy by Hilton brand, managing daily guest services, housekeeping, front desk operations, and food/beverage offerings. They are responsible for maintaining brand standards, collecting gross rooms revenue (subject to 5% royalty), and ensuring compliance with Hilton's operating requirements and ADA accessibility standards.
- CEO
- Christopher J. Nassetta
- Headquarters
- VA
- Founded
- 2007
- FDD year
- 2023
- States available
- 19
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $85K
- Better than avg vs category
- Liquid capital req'd
- N/A
- Near category avg vs category
- Franchise fee
- $85K – $85K
- Near category avg vs category
- Royalty
- 5.0%
- Gross Rooms Revenue · typical 6–8%
- Ad fund
- 4.0%
- typical 3–5%
- Total fee load
- 9.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 4.0% of gross sales |
| Training fee | $20K |
| Transfer fee | $150K |
| Total fee load | 9.0% of rev |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
vs Lodging averages
How Canopy by Hilton Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 26
- Opened
- 3
- Last reporting year
- Closed
- 0
- Terminated
- 4
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Multi-unit owners
- 1.0%
- Net growth (yr3)
- +13.0%
- Net unit change last year
- 3-yr CAGR
- +30.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 3
- Projected new
- 10
- Franchisor's next-year forecast
- Transfer rate
- 11.5%
- Owners selling to other franchisees
- Termination rate
- 15.4%
- Franchisor-initiated terminations
- Ceased ops
- 15.4%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 29 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 2 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 2
- Loan volume
- N/A
- Amount data pending
- Median loan
- N/A
- Charge-off rate
- N/A
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 0
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Canopy presents moderate-to-cautionary risk due to litigation history, undisclosed financial performance, small system size with modest growth, unprotected territory, and lack of Item 19 profitability data needed to justify the $85,000 franchise fee and 5% royalty structure.
Litigation (Item 3)
Five cases identified: (1) State of Nebraska v. Hilton Domestic Operating Company Inc. - pending government action alleging violations of Nebraska Consumer Protection Act and Uniform Deceptive Trade Practices Act regarding mandatory guest fee disclosure (trial scheduled 2023); (2) Destin Platinum LLC v. Hampton Inns Franchise LLC - pending franchisee breach of contract suit related to franchise termination for false books/records; (3) Hilton Franchise Holding LLC v. Portland Hotel Ownership - concluded case, settled July 28, 2022, involving franchisor as plaintiff for breach of contract and promissory note; (4) San Pedro Inn, LP v. Hilton Franchise Holding LLC - concluded case, settled September 25, 2020, franchisee challenged termination under New Jersey Franchise Practices Act; (5) Kathleen Soule v. Hilton Worldwide, Inc. - class action pending as of October 17 (text cuts off).
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Cherry Bekaert LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 54 / 100 rating
- 01HIGHActive pending litigation regarding guest fees and franchise termination suggests operational/contractual disputes and potential franchisor enforcement issues
- 02MINORNo average revenue or net income disclosure (Item 19) prevents accurate ROI assessment and profitability validation
- 03MEDModest unit growth of 13% YoY with only 26 total units indicates limited scale and market traction for an established Hilton brand
- 04MINORUnprotected territory creates direct competition risk from other Canopy franchisees in same markets
- 05MINORHistory of breach of contract settlements and ADA compliance consent decrees suggests systemic operational or compliance challenges
- 06MINOR23-year term is lengthy and limits exit flexibility if brand underperforms or franchisor relationship deteriorates
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 23 years |
|---|---|
| Allowed renewalsℹ | 0 |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rights | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | New York |
| Litigation count | 8 |
View Item 3 litigation summary
Five cases identified: (1) State of Nebraska v. Hilton Domestic Operating Company Inc. - pending government action alleging violations of Nebraska Consumer Protection Act and Uniform Deceptive Trade Practices Act regarding mandatory guest fee disclosure (trial scheduled 2023); (2) Destin Platinum LLC v. Hampton Inns Franchise LLC - pending franchisee breach of contract suit related to franchise termination for false books/records; (3) Hilton Franchise Holding LLC v. Portland Hotel Ownership - concluded case, settled July 28, 2022, involving franchisor as plaintiff for breach of contract and promissory note; (4) San Pedro Inn, LP v. Hilton Franchise Holding LLC - concluded case, settled September 25, 2020, franchisee challenged termination under New Jersey Franchise Practices Act; (5) Kathleen Soule v. Hilton Worldwide, Inc. - class action pending as of October 17 (text cuts off).
Items 10, 11
Training & Operations
- Classroom training
- 149 hrs
- On-the-job training
- 9 hrs
- Training location
- Raleigh, NC or Richmond, VA
- Ongoing training
- Required
- Field support
- 20 hrs/yr
- On-site visits per year
- POS system
- OnQ
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: OnQ
Item 20 · call current owners
Franchisee Contacts
36 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Canopy by Hilton · FDD (2023) PDF
Frequently asked questions
Frequently Asked Questions
What do Canopy by Hilton franchise owners earn?
Canopy by Hilton does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is Canopy by Hilton's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Canopy by Hilton (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many Canopy by Hilton franchise locations are there?
As of their most recent FDD filing, Canopy by Hilton has 26 total units in the United States, including 26 franchised units and 0 company-owned units. 3 new units were opened in the latest reporting year.
Is Canopy by Hilton a good franchise to buy?
FranchiseVerdict rates Canopy by Hilton as a B-grade franchise with a risk score of 54 out of 100, based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.