Graduate by Hilton Franchise Cost, Revenue & Review 2026
- Investment
- $19.0M – $93.7M
- Disclosed sales
- not disclosed
- SBA charge-off
- Not SBA-matched
Data from FDD filing
Analysis by FranchiseVerdict Research · Methodology
Graduate by Hilton is a boutique hotel franchise with playful, locally themed properties in college and university towns. Franchisees own and operate the hotels, managing guest services, food and beverage, and brand standards.
FranchiseVerdict summary · 2026
A Graduate by Hilton franchise requires a total initial investment of $19.0M – $93.7M, including a $100K franchise fee 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: B (Above average), an editorial assessment, not investment advice. Run a live ROI scan →
Limited operating history: franchising since 2024. A system this young has fewer than three years of Item 20 outlet history and rarely enough SBA loans for a charge-off rate, so its grade rests on less evidence than an established system's. Read its Item 20 tables and talk to its first franchisees before relying on the grade. Other new franchisors
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: low - issued within the last 12 months
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 scored3 of 5 headline figures on this page cite a page of the filing; the rest are marked “Not cited” beside the figure.
Overview
- Investment
- $19.0M – $93.7M
- 58th pct Lodging
- Avg gross sales
- N/A
- Royalty
- 5.0%
- 3rd pct Lodging
- Units
- 33
- 34th 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 $19.0M – $93.7M including a $100K franchise fee, 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 B (Above average), verdict score 54/100 (higher is better).
- GROWTHPositive: net +1 franchised outlets in the latest year (1 opened, 0 closed); 5 signed but not yet open (Item 20).
- LEGAL15 litigation matters disclosed in Item 3, higher than typical. Of these, 8 name the franchisor itself, 7 its parent, affiliates or predecessor. Pending claims are allegations, not findings.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Hilton Franchise Holding LLC
- Parent company
- Hilton Domestic Operating Company Inc.
- FDD Item 1, page 9 of the 2026 FDD
- Ultimate parent
- Hilton Worldwide Holdings Inc.
- FDD Item 1, page 9 of the 2026 FDD
- Predecessor
- Graduate IP LLC
- Prior franchisor entity
- CEO title
- Chief Executive Officer and President
- Christopher J. Nassetta
- CEO experience
- 2013 yrs
- Years in role or industry
- Incorporated in
- DE
- HQ
- 7930 Jones Branch Drive, Suite 1100, McLean, Virginia 22102
- Auditor
- CBH (Tysons Corner, Virginia)
- Audited financials
- Franchisor revenue
- $1.6B
- vs $1.5B prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Same owner · FDD Item 1, page 9
17 other brands on this site name Hilton Worldwide Holdings Inc. as parent or ultimate parent in their own FDD.
- Apartment Collection by HiltonC
- Canopy by HiltonB
- Curio Collection by HiltonB
- DoubleTree by HiltonA
- Embassy Suites by HiltonB
- Hampton by HiltonA
- Hilton Garden InnA
- Home2 Suites by HiltonA
- Homewood Suites by HiltonA
- LXRB
- Motto by HiltonB
- Outset Collection by HiltonC
- Project Q by HiltonC
- Tapestry Collection by HiltonB
- Tempo by HiltonC
- Tru by HiltonA
- Undergraduate by HiltonC
Grouped by the owner's name as each filing prints it (this page: the 2026 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
- Christopher J. Nassetta
- Headquarters
- VA
- Founded
- 2007
- FDD year
- 2026
- States available
- 20
Can you afford it, and what does the money buy?
Entry cost runs 533% above the typical lodging franchise.
Source: FDD 2026 · Items 5–7
Full Item 7 breakdown24 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Franchise Application Fee | $100K | $100K | |
| Property Improvement Plan | $0 | $10K | |
| Market Study | — | — | |
| Environmental Assessment | — | — | |
| Real Property | — | — | |
| Construction and Leasehold Improvements | $11.6M | $68.3M | |
| Designer & Engineering Fees | $466K | $2.7M | |
| Furniture, Fixtures & Equipment | $2.2M | $7.8M | |
| Inventory & Operating Equipment | $1.5M | $2.5M | |
| Signage | $64K | $165K | |
| Computer Hardware and Software Systems | $107K | $262K | |
| Guest Internet Access System | $72K | $105K | |
| Connected Room System | $35K | $42K | |
| Delphi Sales and Events System | $990 | $41K | |
| Required Pre-Opening Training | $5K | $15K | |
| ADA Consultant Fee | $6K | $15K | |
| Construction/Renovation Extension Fee | $0 | $10K | |
| Insurance | — | — | |
| Organizational Expense | $75K | $318K | |
| Permits & Licenses | $175K | $1.0M | |
| Total initial investment | $19.0M | $93.7M |
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
- $19.0M – $93.7M
- Middle of category vs category
- Liquid capital req'd
- $1.0M – $1.4M
- Middle of category vs category
- Franchise fee
- $100K – $100K
- Middle of category vs category
- Royalty
- 5.0%
- typical 6–8%
- Ad fund
- 4.0%
- typical 3–5%
- Total fee load
- 9.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 4.0% of gross sales |
| Technology fee | $400 |
| Training fee | $5K |
| Transfer fee | $150K |
| Inventory (initial) | $1.5M – $2.5M |
| Total fee load | 9.0% of rev |
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
Graduate by Hilton 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 Graduate by Hilton 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: 2026 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 9.0% (near the Lodging median).
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 +3.1% 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 Graduate by Hilton 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 2026 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 33
- 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)
- +3.1%
- Net unit change over 3 years
Last fiscal year · Item 20 exits and transfers
- Terminated
- 0
- Not renewed
- 0
- Transferred
- 1
- Reacquired
- 0
- Franchisor bought back
- Signed, not yet open
- 5
- 0.15 per open outlet · Item 20 Table 5
- Projected new
- 0
- Franchisor's next-year forecast
- Transfer rate
- 3.0%
- Owners selling to other franchisees
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 20 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.
20
states with franchisees (per FDD Item 12)
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
Graduate by Hilton presents CAUTION-to-HIGH RISK due to massive capital requirements without financial transparency, stagnant unit growth, active litigation around revenue practices, and unprotected territory in a competitive upscale hotel segment.
Why this reads harsher than the B grade: the grade weighs financial health, unit economics, unit growth, scale, legal, and transparency across the whole filing, while this summary lists individual flags without that weighting. The flags are worth checking with current owners; neither is investment advice.
Litigation (Item 3)
Subject: the franchisor is a named party (defendant).
Pending: Bow Hospitality (RI, breach of contract - Hampton termination); In re Extended Stay Hotel Antitrust Litigation (N.D. Cal., Sherman Act class action); Hanson Dai v. SAS Institute (N.D. Cal., Sherman Act class action); Ryan Segal v. Amadeus IT Group (N.D. Ill., Sherman Act class action); Jeanette Portillo v. CoStar Group (W.D. Wash., Sherman Act class action). Concluded: AAAA Property Partners (M.D. Fla., settled 2025); State of Texas v. Hilton (settled 2025, $2.1M); State of Nebraska v. Hilton (settled 2024, $300K); Hilton Franchise Holding LLC v. Portland Hotel Ownership (settled 2022); San Pedro Inn v. Hilton Franchise Holding (settled 2020). Collection suits in 2025: ML Plaza Owner (VA), Unique Crowne Hospitality (E.D. Va.), Empower Metro Center (VA). Also historical: U.S. v. Hilton Hotels Corporation (1970 Sherman Act, consent decree).
Largest disclosed settlement: $2,100,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · CBH (Tysons Corner, Virginia)
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Audited consolidated financials of franchisor Hilton Franchise Holding LLC (in thousands). FY2025 total revenues $1,560,067K comprised franchise royalty fees $1,502,299K, franchise sales/change-of-ownership fees $52,254K, and franchise termination fees and other $5,514K. Figures reflect the entire Hilton Franchise Holding LLC system (all Hilton brands), not the Graduate brand alone.
ⓘ 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 54 / 100 verdict
- 01MEDExtremely high capital investment ($18.9M+) with no disclosed average revenue or net income—impossible to calculate ROI
- 02MEDMinimal system growth (3.1% YoY) with only 33 units suggests weak franchise model appeal and limited brand momentum
- 03MINORMultiple pending antitrust lawsuits regarding revenue management software and data sharing create operational and financial liability exposure
- 04HIGHHistory of concluded litigation over deceptive guest fee practices and franchise termination disputes indicates systemic franchisee-franchisor conflict
- 05MINORNo protected territory despite massive investment and 23-year commitment creates risk of same-brand cannibalization
- 06MINOR5% royalty on gross rooms revenue (not net) is punitive during low-occupancy periods and reduces franchisee flexibility
- 07MINORAbsence of Item 19 financial performance disclosure prevents validation of unit economics and profitability claims
Severity inferred from the FDD text · not a regulatory classification
Litigation case detail15 matters · Item 3
Litigation cases
The franchisor
Pending (2)
Bow Hospitality LLC v. Hilton Franchise Holding LLC
pendingBrought by a franchisee · filed 2025-01-24 · Superior Court of Kent County, Rhode Island · KC-2025-1291
“Bow Hospitality LLC v. Hilton Franchise Holding LLC (Superior Court of Kent County, Rhode Island), Case No. KC-2025-1291. On January 24, 2025, the plaintiff filed suit against us alleging breach of contract and breach of the covenant of good faith and fair dealing under the Rhode Island Dealership Act”Page 19 of the 2026 FDD, Item 3
Outcome:“We intend to vigorously defend our interests in this matter.”
In re: 177 BFP, LLC
pendingBrought against a franchisee · filed 2025-08-14 · US Bankruptcy Court, E.D. Penn. · 25-13225-amc
“In re: 177 BFP, LLC (US Bankruptcy Court, E.D. Penn., Case No. 25-13225-amc). On August 14, 2025, we filed a petition in this Chapter 7 bankruptcy action to collect an unpaid judgment against a former Embassy Suites franchisee for amounts past due, liquidated damages, and attorneys’ fees.”Page 23 of the 2026 FDD, Item 3
Outcome:“The Court appointed a trustee on October 7, 2025 and a meeting of the creditors is scheduled for April 8, 2026.”
Concluded (4)
AAAA Property Partners LLC v. Hilton Franchise Holding LLC
dismissedBrought by a franchisee · filed 2025-01-24 · M.D. Fla. · 6:25-cv-00132-CEM-RMN
“AAAA Property Partners LLC v. Hilton Franchise Holding LLC (M.D. Fla. Case No. 6:25-cv-00132- CEM-RMN). On January 24, 2025, the plaintiff filed suit against us in Orange County, Florida (Filing No. 215324302) alleging breach of contract arising in connection with our termination of plaintiff’s franchise for the Hilton Garden Inn Orlando I-4 Millenia Boulevard Mall.”Page 21 of the 2026 FDD, Item 3
Outcome:“The parties resolved the case on March 5, 2025 by agreeing to terminate the Franchise Agreement as of January 27, 2025, and the plaintiff agreed to dismiss the lawsuit and sell the property within 150 days. We also agreed not to enforce the former franchisee’s post-termination obligations, including the payment of liquidated damages.”
Hilton Franchise Holding LLC v. Empower Metro Center LLC
settledBrought against a franchisee · filed 2025-02-28 · Cir. Ct. of Fairfax County, Virginia · CL-2025-0003051
“Hilton Franchise Holding LLC v. Empower Metro Center LLC (Cir. Ct. of Fairfax County, Virginia, Case No. CL-2025-0003051). On February 28, 2025, we filed a complaint against a former Hampton brand franchisee for damages and fees arising from the early termination of the franchise agreement for failure to commence or complete the construction of the hotel.”Page 23 of the 2026 FDD, Item 3
Outcome:“On January 14, 2026, the parties agreed to a settlement that was favorable to us and we agreed to dismiss the case.”
Hilton Franchise Holding LLC v. Portland Hotel Ownership, et al.
settledBrought against a franchisee · filed 2020-09-17 · Fairfax County Circuit Court · 2020-14233
“Hilton Franchise Holding LLC v. Portland Hotel Ownership, et al. (Fairfax County Circuit Court, Case Number, Case Number 2020-14233). On September 17, 2020, we filed suit against Portland Hotel Ownership, LLC, a former franchisee of a Curio brand hotel, for breach of contract arising from the early termination of the franchise agreement.”Page 22 of the 2026 FDD, Item 3
Outcome:“On July 28, 2022, the parties settled this case by agreeing to dismiss all claims and exchange general releases.”
San Pedro Inn, LP v. Hilton Franchise Holding LLC
settledBrought by a franchisee · filed 2019-08-28 · Superior Court of New Jersey Chancery Division General Equity Part, Union County · UNN-C- 121 19
“On July 18, 2019, we sent a notice to terminate plaintiff’s franchise for a Hampton hotel for failure to cure a material breach of the franchise agreement. On August 28, 2019, plaintiff filed a complaint alleging wrongful termination under the New Jersey Franchise Practices Act.”Page 22 of the 2026 FDD, Item 3
Outcome:“The parties settled the case on September 25, 2020. The parties agreed to dismiss all claims, exchange general releases, and terminate the franchise on April 28, 2021 without the payment of any termination damages or litigation costs by either party.”
Status not stated in the filing (2)
Hilton Franchise Holding LLC v. ML Plaza Owner LLC
Brought against a franchisee · filed 2026-02-27 · Cir. Ct. of Fairfax County, Virginia · CL-2026-0003448
“Hilton Franchise Holding LLC v. ML Plaza Owner LLC (Cir. Ct. of Fairfax County, Virginia), Case No. CL-2026-0003448. On February 27, 2026, we filed a complaint against a former Hilton brand franchisee for amounts past due and liquidated damages arising from the early termination of the franchise agreement for failing to pay monthly fees.”Page 23 of the 2026 FDD, Item 3
Hilton Franchise Holding LLC v. Unique Crowne Hospitality LLC et al.
Brought against a franchisee · filed 2025-08-25 · E.D. Va. · 1:25-cv-01604-MSN-WEF
“Hilton Franchise Holding LLC v. Unique Crowne Hospitality LLC et al. (E.D. Va.) Case No. 1:25- cv-01604-MSN-WEF. On August 25, 2025, we filed a complaint against a former DoubleTree brand franchisee and its guarantor for damages and fees arising from the early termination of the franchise agreement for failing to comply with DoubleTree brand standards.”Page 23 of the 2026 FDD, Item 3
Parent, affiliates and predecessor
Pending (4)
Hanson Dai v. SAS Institute Inc.
pendingThird-party plaintiff · Hilton Worldwide (Hilton Worldwide Holdings Inc., ultimate parent) · filed 2024-04-26 · N.D. Cal. · 4:24-cv-02537
“Hanson Dai v. SAS Institute Inc. (N.D. Cal.), Civil Case No. 4:24-cv-02537 (Class Action). On April 26, 2024, a putative class action complaint captioned Dai v. SAS Institute Inc., Civil Case No. 4:24-cv-02527, was filed in the United States District Court for the Northern District of California”Page 20 of the 2026 FDD, Item 3
Outcome:“Plaintiffs filed an amended complaint on August 25, 2025. The hotel defendants filed a motion to dismiss which has been fully briefed and pending before the court since October 20, 2025.”
In re Extended Stay Hotel Antitrust Litigation
pendingThird-party plaintiff · Hilton Worldwide (Hilton Worldwide Holdings Inc., ultimate parent) · filed 2024-07-24 · N.D. Cal. · 4:24-civil-09060
“In re Extended Stay Hotel Antitrust Litigation (N.D. Cal.), Civil Case No. 4:24-civil-09060 (Class Action).”Page 20 of the 2026 FDD, Item 3
Outcome:“On November 15, 2024, a consolidated amended complaint was filed and the matter transferred to the Northern District of California on December 13, 2024. The hotel defendants filed a motion to dismiss which has been fully briefed and pending before the Court since October 24, 2025.”
Jeanette Portillo, et. al. v. CoStar Group, Inc., et. al.
pendingThird-party plaintiff · Hilton Worldwide, replaced as defendant by Hilton Domestic Operating Company Inc. (the franchisor's direct parent) on April 16, 2024 · filed 2024-02-20 · W.D. Wash. · 2:24-cv-00229
“Jeanette Portillo, et. al. v. CoStar Group, Inc., et. al. (W.D. Wash.), Civil No. 2:24-cv-00229 (Class Action). On February 20, 2024, plaintiffs filed a class action lawsuit against the CoStar Group, Inc. and its subsidiary STR, Inc., together with several hotel companies including Hilton Worldwide.”Page 21 of the 2026 FDD, Item 3
Outcome:“Plaintiffs filed an amended complaint on September 29, 2025. The hotel defendants filed a motion to dismiss which has been fully briefed and pending before the court since January 6, 2026.”
Ryan Segal v. Amadeus IT Group, S.A., et. al.
pendingThird-party plaintiff · Hilton Worldwide, replaced as defendant by Hilton Domestic Operating Company, Inc. (the franchisor's direct parent) on March 25, 2024 · filed 2024-03-01 · N.D. Ill. · 1:24-civil-01783
“Ryan Segal v. Amadeus IT Group, S.A., et. al. (N.D. Ill.), Civil No. 1:24-civil-01783 (Class Action). On March 1, 2024, plaintiff filed a class action lawsuit against Amadeus IT Group, S.A., Amadeus Hospitality Americas, Inc., and several hotel companies including Hilton Worldwide.”Page 20 of the 2026 FDD, Item 3
Outcome:“the court since August 27, 2025. Hilton Worldwide intends to vigorously defend its interests in this matter.” (page 21)
Concluded (3)
State of Texas v. Hilton Domestic Operating Company Inc.
settledGovernment or regulatory action · Hilton Domestic Operating Company Inc. ('Hilton', the franchisor's parent per Item 1) · filed 2023-05-23 · District Court of Collin County, Texas · 296-02595-2023
“State of Texas v. Hilton Domestic Operating Company Inc. (District Court of Collin County, Texas, CAUSE NO. 296-02595-2023). On May 23, 2023, the plaintiff filed suit against Hilton alleging the violations of the Texas Deceptive Trade Practices Act in relation to how mandatory guest fees are disclosed to consumers.”Page 21 of the 2026 FDD, Item 3
Outcome:“In January 2025, the parties settled the case. Without admitting any fault, Hilton agreed to pay Texas $2.1 million and to disclose, display, and sort guest rooms by their total cost on its hotel reservation websites”
State of Nebraska v. Hilton Domestic Operating Company Inc.
settledGovernment or regulatory action · Hilton Domestic Operating Company Inc. ('Hilton', the franchisor's parent per Item 1) · filed 2019-07-23 · District Court of Lancaster County, Nebraska · D02CI190002366
“State of Nebraska v. Hilton Domestic Operating Company Inc. (District Court of Lancaster County, Nebraska, Case No. D02CI190002366). On July 23, 2019, the plaintiff filed suit against Hilton alleging the violations of the Nebraska Consumer Protection Act and Uniform Deceptive Trade Practices Act in relation to how mandatory guest fees are disclosed to consumers.”Page 22 of the 2026 FDD, Item 3
Outcome:“In February 2024, without admitting any fault, Hilton entered into a settlement agreement with Plaintiff and agreed to pay $300,000 and clearly disclose all mandatory fees and the total price for a booking.”
U.S. v. Hilton Hotels Corporation, et al.
judgmentGovernment or regulatory action · Hilton Hotels Corporation (HHC), later Hilton Worldwide, Inc. and Park Hotels & Resorts Inc., the franchisor's former parent · filed 1970-05-12 · United States District Court, District of Oregon · 70-310
“U.S. v. Hilton Hotels Corporation, et al. (United States District Court, District of Oregon, Case No. 70-310). On or about May 12, 1970, the United States filed a civil complaint against HHC (among other defendants), alleging the violation of Section 1 of the Sherman Act consisting of engaging in a combination and conspiracy in restraint of trade by giving preferential treatment to hotel suppliers”Page 23 of the 2026 FDD, Item 3
Outcome:“On or about November 29, 1971, pursuant to a stipulation filed October 26, 1971, the court entered a final judgment against HHC enjoining and restraining it”
Item 3 lists the litigation the franchisor must disclose; a matter against a parent, an affiliate or a named officer is not a matter against the franchisor, and pending claims are allegations, not findings.
What are you signing up for?
Ongoing fees run about 9.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2026 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 23 years |
|---|---|
| Allowed renewalsℹ | 0 |
| Territory type | No territory protection |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rights | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Transfer requires consent | Yes |
| Termination notice | 10 days |
| Curable defaultsℹ | 4 |
| Mandatory arbitration | No |
| Arbitration location | Virginia / New York |
| Jury trial waiver | Yes |
| Governing law | NY |
| Litigation count | 15 |
View Item 3 litigation summary
Pending: Bow Hospitality (RI, breach of contract - Hampton termination); In re Extended Stay Hotel Antitrust Litigation (N.D. Cal., Sherman Act class action); Hanson Dai v. SAS Institute (N.D. Cal., Sherman Act class action); Ryan Segal v. Amadeus IT Group (N.D. Ill., Sherman Act class action); Jeanette Portillo v. CoStar Group (W.D. Wash., Sherman Act class action). Concluded: AAAA Property Partners (M.D. Fla., settled 2025); State of Texas v. Hilton (settled 2025, $2.1M); State of Nebraska v. Hilton (settled 2024, $300K); Hilton Franchise Holding LLC v. Portland Hotel Ownership (settled 2022); San Pedro Inn v. Hilton Franchise Holding (settled 2020). Collection suits in 2025: ML Plaza Owner (VA), Unique Crowne Hospitality (E.D. Va.), Empower Metro Center (VA). Also historical: U.S. v. Hilton Hotels Corporation (1970 Sherman Act, consent decree).
Items 10, 11
Training & Operations
- Classroom training
- 18 hrs
- On-the-job training
- 1 hrs
- Training location
- Virtual / Online / On-site
- Ongoing training
- Required
- Site selection
- Franchisee with franchisor approval
- Franchisor financing
- Not offered
- Item 10
- POS system
- OnQ
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: OnQ
Item 20 · call current owners
Franchisee Contacts
2 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 Graduate by Hilton franchise?
The total investment to open a Graduate by Hilton franchise ranges from $19.0M – $93.7M, with an initial franchise fee of $100K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Graduate by Hilton franchise owners earn?
Graduate by Hilton 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 Graduate by Hilton?
Graduate by Hilton is franchised by Hilton Franchise Holding LLC. Its parent company is Hilton Domestic Operating Company Inc.. The ultimate parent named in the FDD is Hilton Worldwide Holdings Inc.. Source: FDD Item 1, 2026 filing.
What is Item 19 in the Graduate by Hilton 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 Graduate by Hilton FDD and qualifies whose outlets they describe.
What is Graduate by Hilton's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Graduate by Hilton (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 Graduate by Hilton franchise locations are there?
As of their most recent FDD filing, Graduate by Hilton has 33 total units in the United States, including 33 franchised units and 0 company-owned units. 1 new units were opened in the latest reporting year.
Is Graduate by Hilton a good franchise to buy?
FranchiseVerdict rates Graduate by Hilton as a B-grade franchise with a verdict score of 54 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
Are you the franchisor?
If you represent Graduate by Hilton, you can request corrections or provide updated information.
Other Lodging franchises
Compare similar franchise opportunities in the Lodging category
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.