Clarion / Clarion PointeFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Clarion / Clarion Pointe franchise requires a total initial investment of $298K – $2.6M, including a $45K franchise fee and an ongoing 5.5% royalty[2]. The 2024 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 2024 FDD issuance
Overview
- Investment
- $298K – $2.6M
- 18th pct Lodging
- Avg gross sales
- N/A
- 2nd pct Lodging
- Royalty
- 5.5%
- 31st pct Lodging
- Units
- 178
- 39th 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
Franchising since 1987. Systems this mature have refined operations and brand recognition.
Franchised units fell from 189 to 178 over 3 years. Investigate why operators are leaving.
62 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $298K – $2.6M including a $45K franchise fee, 5.5% ongoing royalty.
- Item 19 discloses "Occupancy, ADR, and RevPAR" rather than annual gross sales, so unit revenue is not directly comparable.
- Verdict B (Above Average) with a risk score of 58/100.
- 62 litigation matters disclosed in Item 3, higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Choice Hotels International, Inc.
- Parent company
- None
- Incorporated in
- DE
- HQ
- 915 Meeting Street, Suite 600, North Bethesda, Maryland 20852
- Auditor
- Ernst & Young LLP
- Audited financials
- Franchisor revenue
- $1.5B
- vs $1.4B prior year
Independent franchisee associations
- Franchise Advisory Council (FAC)
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Overview
About
Franchisees own and operate select-service or extended-stay hotel properties under the Clarion or Clarion Pointe brand, managing daily front-desk operations, housekeeping, maintenance, guest services, and revenue optimization. They pay 5.5% royalties on gross room revenue and generate returns through room bookings, ancillary services (parking, F&B), and property appreciation. Success depends on occupancy rates, average daily rate (ADR) management, and local market demand within the upper-midscale hotel segment.
- CEO
- Patrick S. Pacious
- Headquarters
- MD
- Founded
- 1963
- FDD year
- 2024
- States available
- 40
FDD Item 7 · 2024 filing · 26 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Affiliation Fee (Clarion Conversion) | $45K | $45K | |
| Property Improvements (Clarion Conversion) | $192K | $1.8M | |
| Insurance (Clarion Conversion) | $3K | $88K | |
| Advertising (Clarion Conversion) | $3K | $40K | |
| Pre-Opening Photography (Clarion Conversion) | $1K | $3K | |
| Hardware to operate choiceADVANTAGE PMS (Clarion Conversion) | $4K | $11K | |
| choiceADVANTAGE Software License and Systems Training (Clarion Conversion) | $9K | $11K | |
| Opening Inventory of Supplies (Clarion Conversion) | $48K | $272K | |
| Orientation and Hospitality Training Fees (Clarion Conversion) | $1K | $3K | |
| Mandatory On-Premise Signs (Clarion Conversion) | $15K | $80K | |
| Design and engineering costs and inspections (Clarion Conversion) | $10K | $90K | |
| Working Capital Required Before Operations Begin (Clarion Conversion) | $30K | $60K | |
| Additional Funds for 3-Month Initial Period (Clarion Conversion) | $50K | $100K | |
| Affiliation Fee (Clarion Pointe Conversion) | $45K | $45K | |
| Property Improvements (Clarion Pointe Conversion) | $120K | $960K | |
| Insurance (Clarion Pointe Conversion) | $3K | $88K | |
| Advertising (Clarion Pointe Conversion) | $3K | $40K | |
| Pre-Opening Photography (Clarion Pointe Conversion) | $1K | $3K | |
| Hardware to operate choiceADVANTAGE PMS (Clarion Pointe Conversion) | $4K | $11K | |
| choiceADVANTAGE Software License and Systems Training (Clarion Pointe Conversion) | $9K | $11K | |
| Total initial investment | $709K | $4.3M |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $298K – $2.6M
- Better than avg vs category
- Liquid capital req'd
- $15K – $60K
- Better than avg vs category
- Franchise fee
- $45K – $55K
- Better than avg vs category
- Royalty
- 5.5%
- Gross Room Revenues · typical 6–8%
- Ad fund
- 3.3%
- typical 3–5%
- Total fee load
- 8.8%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.5% of gross sales |
| Marketing / ad fund | 3.3% of gross sales |
| Technology fee | $472 |
| Transfer fee | $45K |
| Renewal fee | $45K |
| Inventory (initial) | $48K – $272K |
| Total fee load | 8.8% of rev |
Financial Performance
This brand's FDD disclosed "Occupancy, ADR, and RevPAR" in Item 19 rather than annual gross sales. This metric cannot be directly compared across brands, so we omit it from rankings.
vs Lodging averages
How Clarion / Clarion Pointe Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 178
- Opened
- 14
- Last reporting year
- Closed
- 15
- Turnover rate
- 8.4%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- -0.6%
- Net unit change last year
- 3-yr CAGR
- -5.8%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 9
- Closed (3yr)
- 11
- Terminated (3yr)
- 8
- Non-renewed (3yr)
- 1
- Transfers (3yr)
- 116
- Reacquired (3yr)
- 0
- Franchisor bought back
- Termination rate
- 6.2%
- Franchisor-initiated terminations
- Ceased ops
- 7.5%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 38 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 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Clarion faces systemic unit decline, extensive royalty litigation, missing financial disclosures, and unprotected territories—presenting material operational and financial risks that warrant deep due diligence before investment.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Ernst & Young LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 58 / 100 rating
- 01MINORDeclining unit count (-0.6% YoY) suggests system contraction and potential franchisee exits
- 02MINOR54 active royalty recovery lawsuits by franchisor indicate widespread payment disputes and cash flow problems among franchisees
- 03MINORNo Item 19 financial performance disclosure prevents assessment of actual franchisee profitability and ROI
- 04MINORWide investment range ($298K–$2.6M) with no average revenue data creates opacity around unit economics
- 05MINORUnprotected territory exposes franchisees to direct franchisor competition and internal cannibalization
- 06HIGHHigh cumulative litigation count (62+ actions) suggests adversarial franchisor-franchisee relationship
- 07MINORMid-to-high royalty rate (5.5%) combined with no profitability disclosure is concerning
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 | 20 years |
|---|---|
| Allowed renewalsℹ | 0 |
| Territory type | Site-specific |
| Protected territory | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Termination notice | 365 days |
| Termination groundsℹ | 2 |
| Curable defaultsℹ | 5 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Maryland |
| Litigation count | 62 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 47 hrs
- On-the-job training
- 0 hrs
- Training location
- On-site and corporate
- Site selection
- franchisor
- Franchisor financing
- Offered
- Item 10
- POS system
- choiceADVANTAGE
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: choiceADVANTAGE
Item 20 · call current owners
Franchisee Contacts
100 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Clarion / Clarion Pointe · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Clarion / Clarion Pointe franchise?
The total investment to open a Clarion / Clarion Pointe franchise ranges from $298K – $2.6M, with an initial franchise fee of $45K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Clarion / Clarion Pointe franchise owners earn?
Clarion / Clarion Pointe 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 Clarion / Clarion Pointe's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Clarion / Clarion Pointe (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 Clarion / Clarion Pointe franchise locations are there?
As of their most recent FDD filing, Clarion / Clarion Pointe has 178 total units in the United States, including 189 franchised units and 0 company-owned units. 14 new units were opened in the latest reporting year.
Is Clarion / Clarion Pointe a good franchise to buy?
FranchiseVerdict rates Clarion / Clarion Pointe as a B-grade franchise with a risk score of 58 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.