Bottom line
- Total investment $319K – $12.1M including a $50K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $67K/year (median $65K).
- Rated MODERATE with a risk score of 62/100. SBA loan default rate of 0.0% across 624 loans (below the industry average).
- 83 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
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Comfort unit return on the cash you put in?
Unlevered ROIC · per unit
0%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Comfort units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$88K
on $439K purchase
Total debt
$351K
SBA $0.2M + senior + seller note
Overview
About
Franchisees operate limited-service hotel properties (typically 60–150 rooms) under the Comfort Inn brand, handling day-to-day management including front desk operations, housekeeping, maintenance, guest services, and revenue management. Franchisees pay 6% of gross room revenue to Choice Hotels and must maintain brand standards, participate in the loyalty program, and use the franchisor's reservation and property management systems.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
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 phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Comfort Inn represents a cautious-to-high-risk opportunity: stagnant growth, aggressive debt collection, pending litigation over hidden fees, and zero financial transparency create meaningful structural concerns despite established brand recognition.
Score breakdown · what drove the 62 / 100 rating
- 01MINORStagnant unit growth (0.5% YoY) indicates a mature or declining system with minimal expansion momentum
- 02MEDNo Item 19 financial disclosure (Avg Net Income not disclosed) prevents validation of $67,470 average revenue claims and actual profitability
- 03HIGHAggressive litigation history: 75 franchisor-initiated collection actions in 2023 alone, plus pending class action in Canada regarding undisclosed fees—suggests systemic payment issues and franchisor-franchisee tension
- 04MINORWide investment range ($319K–$12.1M) with no protected territory creates unpredictable ROI and cannibalization risk
- 05HIGHPending class action litigation over undisclosed destination marketing fees indicates potential hidden costs beyond stated 6% royalty
- 06MINORChoice Hotels' anti-competitive practice disputes raise concerns about franchisor's operational fairness and legal compliance
- 07MINORHigh royalty rate (6% of gross, not net) combined with no profitability data creates cash flow risk in low-margin hospitality
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
100 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Comfort · FDD (2024) PDF