Homewood Suites by HiltonFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Homewood Suites by Hilton franchise requires a total initial investment of $21.4M – $31.8M, including a $100K franchise fee and an ongoing 3.5% royalty[2]. The 2023 FDD does not disclose unit-level revenue (no Item 19). SBA 7(a) loans show a 0.0% charge-off rate across 31 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2023 FDD issuance
Overview
- Investment
- $21.4M – $31.8M
- 50th pct Lodging
- Avg gross sales
- N/A
- 2nd pct Lodging
- Royalty
- 3.5%
- 1st pct Lodging
- Units
- 508
- 48th pct Lodging
- SBA default
- 0.0%
- system-wide median varies by category
Quick verdict · Lodging · color = vs category peers
Green = >15% above Lodging avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Only 0.0% of 31 SBA loans charged off, well below the 16% franchise average.
Franchising since 1988. Systems this mature have refined operations and brand recognition.
Franchised units fell from 508 to 486 over 3 years. Investigate why operators are leaving.
Bottom line
- Total investment $21.4M – $31.8M including a $100K franchise fee, 3.5% ongoing royalty.
- Item 19 discloses "Average Room Rate and Occupancy" rather than annual gross sales, so unit revenue is not directly comparable.
- Verdict A (Top Quintile) with a risk score of 37/100. SBA loan charge-off rate of 0.0% across 31 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- Item 19 reports "Average Room Rate and Occupancy" instead of annual gross sales. Ask franchisees directly for full unit-level revenue.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Hilton Franchise Holding LLC
- Parent company
- Hilton Domestic Operating Company Inc.
- Incorporated in
- DE
- HQ
- 7930 Jones Branch Drive, Suite 1100, McLean, Virginia 22102
- Auditor
- Cherry Bekaert LLP
- Audited financials
- Franchisor revenue
- $883.3M
- vs $1.2B prior year
Overview
About
Homewood Suites franchisees operate upscale extended-stay hotels targeting business travelers and relocation customers, managing daily operations including housekeeping, front-desk, food service, maintenance, and revenue management. Franchisees must maintain Hilton brand standards, loyalty program integration, and comply with corporate policies while generating revenue from room rentals, extended-stay packages, and ancillary services (parking, laundry, internet).
- CEO
- Christopher J. Nassetta
- Headquarters
- VA
- Founded
- 1946
- FDD year
- 2023
- States available
- 49
FDD Item 7 · 2023 filing · 23 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 | $14.9M | $21.7M | |
| Design and Engineering Fees | $447K | $652K | |
| Furniture, Fixtures and Equipment | $2.8M | $4.2M | |
| Inventory and Operating Equipment | $231K | $578K | |
| Signage | $20K | $83K | |
| Computer Hardware and Software | $56K | $149K | |
| Guest Internet Access Program | $64K | $78K | |
| Delphi Sales and Events System | $990 | $19K | |
| Required Pre-Opening Training | $5K | $18K | |
| ADA Consultant | $3K | $15K | |
| Construction/Renovation Extension Fees | $0 | $10K | |
| Insurance | — | — | |
| Organizational Expense | $50K | $131K | |
| Permits, Licenses and Governmental Fees | $224K | $326K | |
| Miscellaneous Pre-Opening and Project Management Expenses | $447K | $652K | |
| Total initial investment | $21.4M | $31.9M |
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
- $21.4M – $31.8M
- Near category avg vs category
- Liquid capital req'd
- $600K – $900K
- Near category avg vs category
- Franchise fee
- $100K – $100K
- Near category avg vs category
- Royalty
- 3.5%
- Gross Rooms Revenue · typical 6–8%
- Ad fund
- 3.5%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 3.5% of gross sales |
| Marketing / ad fund | 3.5% of gross sales |
| Technology fee | $149K |
| Transfer fee | $200K |
| Renewal fee | $100K |
| Total fee load | 7.0% of rev |
Financial Performance
This brand's FDD disclosed "Average Room Rate and Occupancy" in Item 19 rather than annual gross sales. This metric cannot be directly compared across brands, so we omit it from rankings.
vs Lodging averages
How Homewood Suites by Hilton Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 508
- Opened
- 12
- Last reporting year
- Closed
- 5
- Terminated
- 3
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 1
- Term expired, not renewed (per Item 20)
- Turnover rate
- 1.0%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +1.8%
- Net unit change last year
- 3-yr CAGR
- +4.5%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 28
- Transfer rate
- 5.5%
- Owners selling to other franchisees
- Continuity rate
- 99.4%
- Units that stayed open
- Termination rate
- 0.8%
- Franchisor-initiated terminations
- Ceased ops
- 0.2%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 49 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.
- Total loans
- 31
- Loan volume
- $117.1M
- Median loan
- $4.8M
- 50th percentile
- Charge-off rate
- 0.0%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 100.0%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 4
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Homewood Suites by Hilton's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 3 lenders with concentration factor
- Per-state charge-off rates across 2 states
- Startup risk premium and job creation velocity
- 3-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
With a 0.0% charge-off rate across 31 loans, banks have historically viewed this brand favorably for lending.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
High-barrier extended-stay hotel franchise with extreme capital requirements, undisclosed unit economics, slow growth, active litigation, and escalating royalties—suitable only for institutional operators with litigation tolerance and capital reserves.
Litigation (Item 3)
Four cases disclosed: (1) State of Nebraska v. Hilton - pending government action alleging violations of Nebraska Consumer Protection Act and Uniform Deceptive Trade Practices Act related to mandatory guest fee disclosures, trial scheduled for 2023; (2) Destin Platinum LLC v. Hampton Inns Franchise LLC - pending franchisee breach of contract suit regarding franchise termination, not yet served; (3) Hilton Franchise Holding LLC v. Portland Hotel Ownership - franchisor breach of contract and promissory note action, settled July 2022 with dismissal of all claims; (4) San Pedro Inn, LP v. Hilton Franchise Holding LLC - franchisee wrongful termination suit under New Jersey Franchise Practices Act, settled September 2020 with franchise termination effective April 2021 and no damages paid.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Cherry Bekaert LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Score breakdown · what drove the 37 / 100 rating
- 01MEDMassive capital requirement ($21.4M–$31.8M) with no disclosed average revenue or net income prevents ROI validation
- 02MEDRoyalty escalation (3.5%→5.5%) combined with undisclosed financials creates earnings opacity and unpredictable cash flow
- 03MINORAnemic unit growth (1.8% YoY across 508 units) suggests market saturation or franchisee underperformance
- 04HIGHMultiple active litigation vectors (consumer protection, ADA compliance consent decrees, breach of contract suits) indicate systemic operational/legal vulnerabilities
- 05MINORUnprotected territory enables corporate cannibalization and direct competition from other franchisees
- 06MED22-year term locks capital into a mature, slow-growth segment with limited exit liquidity
- 07MINORNo Item 19 financial disclosure prevents independent verification of unit-level economics
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 22 years |
|---|---|
| Allowed renewalsℹ | 0 |
| Territory type | Radius |
| Protected territory | No |
| Online sales rights | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | New York |
| Litigation count | 8 |
View Item 3 litigation summary
Four cases disclosed: (1) State of Nebraska v. Hilton - pending government action alleging violations of Nebraska Consumer Protection Act and Uniform Deceptive Trade Practices Act related to mandatory guest fee disclosures, trial scheduled for 2023; (2) Destin Platinum LLC v. Hampton Inns Franchise LLC - pending franchisee breach of contract suit regarding franchise termination, not yet served; (3) Hilton Franchise Holding LLC v. Portland Hotel Ownership - franchisor breach of contract and promissory note action, settled July 2022 with dismissal of all claims; (4) San Pedro Inn, LP v. Hilton Franchise Holding LLC - franchisee wrongful termination suit under New Jersey Franchise Practices Act, settled September 2020 with franchise termination effective April 2021 and no damages paid.
Items 10, 11
Training & Operations
- Classroom training
- 143 hrs
- On-the-job training
- 2 hrs
- Training location
- On-site
- POS system
- OnQ
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: OnQ
Item 20 · call current owners
Franchisee Contacts
99 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Homewood Suites by Hilton · FDD (2023) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Homewood Suites by Hilton franchise?
The total investment to open a Homewood Suites by Hilton franchise ranges from $21.4M – $31.8M, 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 Homewood Suites by Hilton franchise owners earn?
Homewood Suites by Hilton 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 Homewood Suites by Hilton's franchise failure rate?
Based on SBA 7(a) loan data, Homewood Suites by Hilton has a charge-off rate of 0.0% across 31 loans, meaning 0.0% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Homewood Suites by Hilton franchise locations are there?
As of their most recent FDD filing, Homewood Suites by Hilton has 508 total units in the United States, including 508 franchised units and 0 company-owned units. 12 new units were opened in the latest reporting year.
Is Homewood Suites by Hilton a good franchise to buy?
FranchiseVerdict rates Homewood Suites by Hilton as a A-grade franchise with a risk score of 37 out of 100, 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.
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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.