Clarion / Clarion Pointe Franchise Cost, Revenue & Review 2026
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 does not disclose unit-level revenue (no Item 19). FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2024 FDD issuance
Overview
- Investment
- $410K – $2.6M
- 19th pct Lodging
- Avg gross sales
- N/A
- Royalty
- 5.5%
- 38th 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 avg · 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.
- RETURNS2023 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.
- RISKVerdict A (Strongest tier), verdict score 66/100 (higher is better).
- DATAItem 19 reports ADR/RevPAR/Occupancy (no gross sales disclosed) rather than annual gross sales, so unit revenue is not directly comparable. Ask franchisees directly for full unit-level revenue.
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.
- 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.
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 85% below the typical lodging franchise.
Source: FDD 2024 · Items 5–7
Full Item 7 breakdown26 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
- $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%
- percentage · 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
Clarion / Clarion Pointe did not disclose financial performance in FDD Item 19. The ROIC and return models require Item 19 revenue. Without it all inputs are estimates. You can still run the calculator with your own assumptions by entering an expected revenue figure.
Returns model · single-unit ROIC
What would one Clarion / Clarion Pointe unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
5%
Below the 30–60% attractive-franchise band
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
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.
- Item 19 type
- ADR/RevPAR/Occupancy (no gross sales disclosed)
- Sample size
- 160 outlets
- vs category median 99
- Transparency tier
- revenue_only
- Categorical assessment of disclosure depth
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2024
- The FDD edition these figures were read from
- Transparency
- 0 / 10
- vs category median 0 / 10 · typical
Compared against 174 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% — below the Lodging average of 10.4%.
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 averages
How Clarion / Clarion Pointe Compares
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
3-year detail · Item 20
- Opened (3yr)
- 14
- Closed (3yr)
- 13
- Terminated (3yr)
- 1
- 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 · 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.
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)
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.
Largest disclosed settlement: $85,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Ernst & Young LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
ⓘ 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 66 / 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
- 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
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 | none |
| 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 | 4 |
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
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 $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?
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 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 A-grade franchise with a verdict score of 66 out of 100 (higher is better), 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
Are you the franchisor?
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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.