Clarion / Clarion Pointe Franchise Cost, Revenue & Review 2026
- Investment
- $410K – $2.6M
- Disclosed sales
- partial, no system average
- SBA charge-off
- Not SBA-matched
Data from FDD filing
Analysis by FranchiseVerdict Research · Methodology
Clarion and Clarion Pointe are Choice Hotels midscale, select-service hotel franchises. Franchisees own and operate individual properties, running front desk, housekeeping, and revenue management on Choice's systems.
FranchiseVerdict summary · 2026
A Clarion / Clarion Pointe franchise requires a total initial investment of $410K – $2.6M, including a $45K franchise fee and an ongoing 5.5% royalty[2]. The 2024 FDD on file does not yield a unit-revenue figure we can publish. FranchiseVerdict grade: B (Above average), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: high - issued more than two years ago
Evidence: strong✓ Investment (Item 7)✓ Item 19 status✓ Units and owners (Item 20)✗ SBA loan coverage✓ Litigation (Item 3)✓ Financial statements (Item 21)✓ Franchisor identityhow this is scored4 of 5 headline figures on this page cite a page of the filing; the rest are marked “Not cited” beside the figure.
Overview
- Investment
- $410K – $2.6M
- 20th pct Lodging
- Avg gross sales
- N/A
- Projection
- Royalty
- 5.5%
- 39th pct Lodging
- Units
- 178
- 52nd pct Lodging
- SBA charge-off
- N/A
Quick verdict · Lodging · color = vs category peers
Green = favorable by >10% vs Lodging median · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $410K – $2.6M including a $45K franchise fee, 5.5% ongoing royalty.
- RETURNSItem 19 reports ADR/RevPAR/Occupancy (no gross sales disclosed) rather than annual gross sales, so unit revenue is not directly comparable.
- RISKVerdict B (Above average), verdict score 60/100 (higher is better).
- GROWTHNegative: net -1 franchised outlets in the latest year (14 opened, 15 closed) (Item 20).
- LEGAL91 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
Corporate structure & franchisor financials
- Legal entity
- Choice Hotels International, Inc.
- Parent company
- Choice Hotels International, Inc.
- FDD Item 1, page 10 of the 2024 FDD
- CEO title
- Senior Vice President, Foundation Brands Development
- Tom Nee
- 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.
Same owner · FDD Item 1, page 10
11 other brands on this site name Choice Hotels International, Inc. as parent or ultimate parent in their own FDD.
- ASCEND HOTEL COLLECTIONA
- Country Inn & Suites by RadissonB
- Econo LodgeB
- Everhome SuitesB
- MainStay SuitesA
- Park Inn by RadissonD
- RODEWAY INNB
- Radisson IndividualsC
- Sleep InnB
- Suburban StudiosB
- WoodSpring SuitesB
Grouped by the owner's name as each filing prints it (this page: the 2024 FDD). Spelling variants of the same group may be listed apart; a brand is never grouped with an owner its filing does not name.
Overview
About
- CEO
- Tom Nee
- Headquarters
- MD
- Founded
- 1963
- FDD year
- 2024
- States available
- 40
Can you afford it, and what does the money buy?
Entry cost runs 83% below the typical lodging franchise.
Source: FDD 2024 · Items 5–7
Full Item 7 breakdown13 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 | |
| Total initial investment | $410K | $2.6M |
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
- $410K – $2.6M
- Top 40% of category vs category
- Liquid capital req'd
- $50K – $100K
- Top 40% of category vs category
- Franchise fee
- $45K – $45K
- Top 40% of category vs category
- Royalty
- 5.5%
- 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 |
| Training fee | $3K |
| Transfer fee | $45K |
| Renewal fee | $45K |
| Inventory (initial) | $48K – $272K |
| Total fee load | 8.8% of rev |
What do units actually make?
Source: FDD 2024 · Item 19
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
No Item 19 revenue figure for Clarion / Clarion Pointe is on file. The return models need a revenue figure to start from, and the operating costs that turn gross sales into a profit are in no FDD. Enter your own and the calculator runs on your assumptions — nothing here is modelled until you do.
Returns model · single-unit ROIC
What would one Clarion / Clarion Pointe unit return on the cash you put in?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for annual revenue, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2024 FDD
Financial Performance
An occupancy metric, not unit revenue
- Item 19 type
- ADR/RevPAR/Occupancy (no gross sales disclosed)
- Sample size
- 160 outlets
- vs category median 98
- Reporting year
- 2023
- Fiscal year the figures cover
- Source filing
- FDD 2024
- Disclosed in the 2024 filing, covering 2023
Compared against 175 Lodging brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Fee burden
Total ongoing fee load of 8.8% (near the Lodging median).
Disclosure
Item 19 reports ADR/RevPAR/Occupancy (no gross sales disclosed) rather than annual gross sales, so unit revenue is not directly comparable.
Operator retention
System contracting at -2.7% CAGR over 3 years. Investigate whether closures are franchisor-driven consolidation or franchisee exits.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Lodging medians
How Clarion / Clarion Pointe Compares
Category median of published Lodging brands that report the figure; the middle half spans the 25th to 75th percentile and n counts the brands behind it. Medians are used because a few very large systems pull an average far from the typical brand. Revenue is disclosed gross sales, not profit.
Is the system healthy?
Source: FDD 2024 · Item 20
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 (3-yr)
- -2.7%
- Net unit change over 3 years
- 3-yr CAGR
- -2.7%
- Compounded over last 3 years
Last fiscal year · Item 20 exits and transfers
- Projected new
- 16
- Franchisor's next-year forecast
- 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 · 31 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.
Where the owners are · Item 20 owner list
77 current owners across 31 states.
- NY 8
- FL 7
- NC 6
- IN 5
- MI 5
- GA 4
- MD 4
- NJ 4
- AZ 3
- CO 3
- IL 3
- LA 3
- +19 more states
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
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.
What could kill this investment?
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
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)
Subject: the franchisor is a named party (defendant).
Pending: (1) Norma Knuth class action re destination marketing fees in Canada; (2) Jai Sai Baba LLC et al. (approx. 90 franchisees alleging discrimination/RICO) stayed pending arbitration, with related DIP Hospitality arbitration; (3) T&T Management Inc. alleging breach of license agreement and trade secret misappropriation. Prior year: numerous franchisor-initiated royalty/liquidated damages collection actions and IP enforcement post-termination.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Ernst & Young LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
2023 total revenues of $1,544,165K include $784,160K of "Other revenues from franchised and managed properties" (largely pass-through marketing/reservation system reimbursements) and $97,641K owned-hotel revenue. Core royalty, licensing and management fees were $513,412K. Statements are consolidated across all Choice brands, not Clarion Pointe-specific.
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results — the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 60 / 100 verdict
- 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
- 03MINORWide investment range ($298K–$2.6M) with no average revenue data creates opacity around unit economics
- 04MINORUnprotected territory exposes franchisees to direct franchisor competition and internal cannibalization
- 05HIGHHigh cumulative litigation count (62+ actions) suggests adversarial franchisor-franchisee relationship
- 06MINORMid-to-high royalty rate (5.5%) combined with no profitability disclosure is concerning
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 8.8% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2024 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 20 years |
|---|---|
| Allowed renewalsℹ | 0 |
| Territory type | No territory protection |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Transfer requires consent | Yes |
| Termination notice | 10 days |
| Termination groundsℹ | 2 |
| Curable defaultsℹ | 2 |
| Mandatory arbitration | Yes |
| Arbitration location | Maryland |
| Jury trial waiver | No |
| Governing law | MD |
| Litigation count | 91 |
View Item 3 litigation summary
Pending: (1) Norma Knuth class action re destination marketing fees in Canada; (2) Jai Sai Baba LLC et al. (approx. 90 franchisees alleging discrimination/RICO) stayed pending arbitration, with related DIP Hospitality arbitration; (3) T&T Management Inc. alleging breach of license agreement and trade secret misappropriation. Prior year: numerous franchisor-initiated royalty/liquidated damages collection actions and IP enforcement post-termination.
Items 10, 11
Training & Operations
- Classroom training
- 47 hrs
- On-the-job training
- 0 hrs
- Training location
- North Bethesda, Maryland or Scottsdale, Arizona (Choice Onboard); online/virtual (HOST)
- Ongoing training
- Required
- Time to open
- 18 mo
- From signing to launch
- Site selection
- Franchisee selects; franchisor must approve
- 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
77 owners to call
Name · phone · city · state. Extracted from FDD Item 20
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 $410K – $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?
Item 19 of the Clarion / Clarion Pointe FDD discloses figures for part of the system but no single average across all outlets. These are gross sales figures, not profit; the Revenue section shows what the filing reports and on what basis. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Who owns Clarion / Clarion Pointe?
Clarion / Clarion Pointe is franchised by Choice Hotels International, Inc.. Source: FDD Item 1, 2024 filing.
What is Item 19 in the Clarion / Clarion Pointe FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Clarion / Clarion Pointe FDD and qualifies whose outlets they describe.
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 178 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 verdict score of 60 out of 100 (higher is better). The grade is a deterministic score built from six weighted dimensions — financial health, unit economics, unit growth, scale, legal, and transparency — then calibrated against SBA loan charge-off rates and FDD age. Transparency is one of the six, so a filing that discloses less scores lower on that dimension than one that discloses more. 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.