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B60/100FDD 2026

Home2 Suites by Hilton — Litigation & Risk

Lodging - Hotels & Motels · FDD Items 3, 4 & 5

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Elevated Risk

16 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
16
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
60 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID

7(a) FOIA data · FY2020–present

SBA Loan Performance

Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.

Total 7(a) loans
4
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$15.3M
Avg loan size
$3.8M
Participating lenders
4

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
Jury trial waiver
Waived
You give up the right to a jury trial
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
No
Franchisor can match any purchase offer when you try to sell
Governing law
New York
State whose law governs disputes — relevant if you're not based there

What drove the 60/100 rating

Risk Score Breakdown

  1. 01MEDExtremely high capital requirement ($18M-$26.5M) with no disclosed average unit volumes or net income to validate ROI
  2. 02HIGHActive antitrust litigation alleging price-fixing through revenue management software affecting entire system credibility and potential liability
  3. 03HIGHState-level consumer protection litigation (TX, Nebraska) regarding mandatory fee disclosure suggests systemic compliance issues
  4. 04MINORNo protected territory combined with 10.3% YoY growth saturating markets without franchisee exclusivity
  5. 05MINOR6% royalty on gross rooms revenue (not net) creates ongoing pressure during economic downturns
  6. 06MEDItem 19 financial performance representations not disclosed, making it impossible to validate investment thesis

Severity inferred from FDD text — not a regulatory or legal classification

Litigation data from FDD Items 3, 4, and 5. SBA data from public 7(a) FOIA records (FY2020–present). Not legal advice — consult a franchise attorney before signing any franchise agreement.