Compass by Margaritaville Franchise Cost, Revenue & Review 2026
- Investment
- $10.2M – $37.4M
- Disclosed sales
- not disclosed
- SBA charge-off
- Not SBA-matched
Data from FDD filing
Analysis by FranchiseVerdict Research · Methodology
Compass by Margaritaville is a lifestyle hotel franchise offering laid-back, coastal-themed properties under the Margaritaville brand. Franchisees own and operate the hotels, managing guest services, amenities, and revenue.
FranchiseVerdict summary · 2026
A Compass by Margaritaville franchise requires a total initial investment of $10.2M – $37.4M and an ongoing 5.0% royalty[2]. This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. FranchiseVerdict grade: C (Average), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: 2024 filing · Data extracted: · Last cited check: · Staleness risk: high - figures are from a filing two or more years old
Evidence: partial✓ 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 4 headline figures on this page cite a page of the filing.
Overview
- Investment
- $10.2M – $37.4M
- 43rd pct Lodging
- Avg gross sales
- N/A
- 2 outlets
- Royalty
- 5.0%
- 3rd pct Lodging
- Units
- 2
- 11th 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 $10.2M – $37.4M, 5.0% ongoing royalty.
- RETURNSThis franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that.
- RISKVerdict C (Average), verdict score 41/100 (higher is better).
- GROWTHNegative, pipeline stalled: 14 agreements signed but not yet open against 2 open outlets (Item 20).
- DATAThis franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Compass Margaritaville, L.L.C.
- Parent company
- Margaritaville Enterprises, LLC
- FDD Item 1, page 9 of the 2024 FDD
- Ultimate parent
- Margaritaville Holdings LLC
- FDD Item 1, page 9 of the 2024 FDD
- CEO title
- Chief Executive Officer
- John Cohlan
- Incorporated in
- DE
- HQ
- 6900 Turkey Lake Road, Suite 200, Orlando, Florida 32819
- Auditor
- Ernst & Young LLP
- Audited financials
- Franchisor revenue
- $92.5M
- vs $74.9M 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 9
2 other brands on this site name Margaritaville Holdings LLC as parent or ultimate parent in their own FDD.
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
- John Cohlan
- Headquarters
- FL
- Founded
- 2018
- FDD year
- 2024
- States available
- 2
Can you afford it, and what does the money buy?
Entry cost runs 168% above the typical lodging franchise.
Source: FDD 2024 · Items 5–7
The filing does not state an initial franchise fee.
Full Item 7 breakdown23 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Application Feenot refundable | $65K | $65K | |
| PIP fee (Property Improvement Plan)not refundable | $0 | $5K | |
| TIP fee (Technology Improvement Plan)not refundable | $0 | $10K | |
| Professional services fees (architect, design, market study, engineering)not refundable | $450K | $700K | |
| Insurance and Permits, licenses, deposits, and related feesnot refundable | $50K | $150K | |
| Training fees and expenses vendor and brand trainingnot refundable | $35K | $150K | |
| Construction, improvements, remodeling, and decorating costsnot refundable | $5.0M | $30.0M | |
| Technologynot refundable | $550K | $830K | |
| Website Set-Upnot refundable | $12K | $30K | |
| CRS Set Upnot refundable | $5K | $5K | |
| CRM Set-Upnot refundable | $13K | $13K | |
| Loyalty Program Set-Upnot refundable | $5K | $5K | |
| Furniture, fixtures, other fixed assets, and equipment (FF&E)not refundable | $1.8M | $2.1M | |
| Operational Supplies and Equipment (OSE)not refundable | $500K | $1.0M | |
| Exterior signsnot refundable | $200K | $250K | |
| Financial, tax, and legal costsnot refundable | $600K | $750K | |
| Pre-opening Sales and Marketingnot refundable | $150K | $250K | |
| Photography and Videographynot refundable | $40K | $125K | |
| Medallia Set-Upnot refundable | $3K | $3K | |
| Financial Reporting System Set-Upnot refundable | $10K | $16K | |
| Total initial investment | $10.2M | $37.4M |
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
- $10.2M – $37.4M
- Middle of category vs category
- Liquid capital req'd
- $300K – $500K
- Top 40% of category vs category
- Franchise fee
- N/A
- Fee not disclosed
- Royalty
- 5.0%
- typical 6–8%
- Ad fund
- 1.5%
- typical 3–5%
- Total fee load
- 6.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 1.5% of gross sales |
| Training fee | $150K |
| Renewal fee | $30K |
| Inventory (initial) | $500K – $1.0M |
| Total fee load | 6.5% of rev |
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
Compass by Margaritaville makes no financial performance representation in Item 19 of its FDD - a voluntary item under the FTC Franchise Rule - so no unit revenue figures are disclosed. 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 Compass by Margaritaville 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
No financial performance representation
This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that.
Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
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 6.5% — below the Lodging median of 8.5%.
Disclosure
This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Operator retention
Net unit growth of +100.0% over 3 years (1 opened, 0 closed).
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 Compass by Margaritaville 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
- 2
- Opened
- 1
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- N/A
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (3-yr)
- +100.0%
- Net unit change over 3 years
- 3-yr CAGR
- +100.0%
- Compounded over last 3 years
Last fiscal year · Item 20 exits and transfers
- Terminated
- 0
- Not renewed
- 0
- Transferred
- 0
- Reacquired
- 0
- Franchisor bought back
- Signed, not yet open
- 14
- 7.00 per open outlet · Item 20 Table 5
- Projected new
- 2
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 2 states reported
The Territory Map
FDD Item 12 reports the state count, but the specific list isn't in our current data. The map will appear once we re-extract from the FDD or enough franchisee contacts are available.
2
states with franchisees (per FDD Item 12)
Fast growth in a small system. Newer franchisors expanding quickly may not yet have the support infrastructure of larger systems.
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
A capital-intensive resort/hospitality franchise with only 2 units, undisclosed financials, multiple legal disputes, regulatory compliance failures, and no territory protection represents extreme execution risk with questionable franchisor financial stability.
Litigation (Item 3)
Subject: the franchisor is a named party (defendant).
Three matters: (1) Boss Investments Ltd. v. Margaritaville entities — trademark sub-license dispute, settled January 2021 with corporate defendants paying 50% of future food/beverage royalties from Bahamian Hotel; (2) Shultz et al. v. Margaritaville Enterprises et al. — cottage owner tort claims, dismissed with prejudice April 2023, mutual walk-away; (3) California DFPI consent order against Margaritaville Hotels & Resorts for failure to file exemption notices for three California franchise sales, resolved March 2020 with $7,500 penalty.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Ernst & Young LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Audited consolidated statements of Margaritaville Holdings LLC (parent), Ernst & Young LLP, years ended Dec 31, 2023 and 2022. Total partners' deficit (negative net worth) of $(101,014,475) at Dec 31, 2023. Revenue comprises restaurant/retail sales plus restaurant, resort, residential/timeshare, and consumer products royalties.
ⓘ 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: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 41 / 100 verdict
- 01MINOROnly 2 operating units with unknown growth trajectory suggests failed or stalled system expansion
- 02HIGHMultiple litigation cases including trademark disputes, deceptive practices lawsuits, and regulatory compliance failures (California administrative consent order 2020)
- 03MINORNo protected territory means franchisees face direct competition from other Compass locations
- 04MINORMargaritaville brand association carries reputational risk given parent company's past financial troubles and casual dining market headwinds
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 6.5% 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 |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 1 |
| 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 | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Termination groundsℹ | 1 |
| Curable defaultsℹ | 9 |
| Mandatory arbitration | Yes |
| Arbitration location | Atlanta, Georgia |
| Jury trial waiver | Yes |
| Governing law | DE |
| Litigation count | 3 |
View Item 3 litigation summary
Three matters: (1) Boss Investments Ltd. v. Margaritaville entities — trademark sub-license dispute, settled January 2021 with corporate defendants paying 50% of future food/beverage royalties from Bahamian Hotel; (2) Shultz et al. v. Margaritaville Enterprises et al. — cottage owner tort claims, dismissed with prejudice April 2023, mutual walk-away; (3) California DFPI consent order against Margaritaville Hotels & Resorts for failure to file exemption notices for three California franchise sales, resolved March 2020 with $7,500 penalty.
Items 10, 11
Training & Operations
- Classroom training
- 7 hrs
- On-the-job training
- 33 hrs
- Training location
- Franchisor-selected Margaritaville-branded venue (offsite), plus on-site task force training pre-opening
- Ongoing training
- Required
- Time to open
- 18 mo
- From signing to launch
- Site selection
- Franchisee selects; franchisor approves
- Franchisor financing
- Not offered
- Item 10
- POS system
- InfoGenesis
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: InfoGenesis
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Compass by Margaritaville franchise?
The total investment to open a Compass by Margaritaville franchise ranges from $10.2M – $37.4M. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Compass by Margaritaville franchise owners earn?
Compass by Margaritaville makes no financial performance representation in Item 19 of its FDD - a voluntary item under the FTC Franchise Rule - so no unit revenue figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Who owns Compass by Margaritaville?
Compass by Margaritaville is franchised by Compass Margaritaville, L.L.C.. Its parent company is Margaritaville Enterprises, LLC. The ultimate parent named in the FDD is Margaritaville Holdings LLC. Source: FDD Item 1, 2024 filing.
What is Item 19 in the Compass by Margaritaville 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 Compass by Margaritaville FDD and qualifies whose outlets they describe.
What is Compass by Margaritaville's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Compass by Margaritaville (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 Compass by Margaritaville franchise locations are there?
As of their most recent FDD filing, Compass by Margaritaville has 2 total units in the United States, including 2 franchised units and 0 company-owned units. 1 new units were opened in the latest reporting year.
Is Compass by Margaritaville a good franchise to buy?
FranchiseVerdict rates Compass by Margaritaville as a C-grade franchise with a verdict score of 41 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.