MainStay SuitesFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A MainStay Suites franchise requires a total initial investment of $8.7M – $15.8M, including a $50K franchise fee and an ongoing 6.0% royalty[2]. Per the 2024 FDD, average unit revenue was $2.1M[2]. Verdict grade: C. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2024 FDD issuance
Overview
- Investment
- $8.7M – $15.8M
- 37th pct Lodging
- Avg gross sales
- $2.1M
- 1st pct Lodging
- Royalty
- 6.0%
- 39th pct Lodging
- Units
- 126
- 37th pct Lodging
- SBA default
- 22.2%
- 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
At 0.2x revenue per dollar invested, this system underperforms the typical 1.5-2.5x range.
Franchising since 1996. Systems this mature have refined operations and brand recognition.
90 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $8.7M – $15.8M including a $50K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $2.1M/year (median $2.1M).
- Verdict C (Average) with a risk score of 66/100.
- 90 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
- Legal entity
- Choice Hotels International, Inc.
- Incorporated in
- DE
- HQ
- 915 Meeting Street, Suite 600, North Bethesda, Maryland 20852
- Auditor
- Ernst & Young LLP
- Audited financials
- Franchisor revenue
- $1.4B
- vs $1.5B prior year
Independent franchisee associations
- Franchise Advisory Council (FAC)
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Overview
About
MainStay Suites franchisees operate economy-segment extended-stay hotel properties under a 20-year license agreement. Day-to-day operations include managing front desk/housekeeping staff, maintaining occupancy rates, collecting rent/room revenue, and ensuring brand compliance with Choice Hotels standards while remitting 6% of gross room revenues as ongoing royalties.
- CEO
- Patrick S. Pacious
- Headquarters
- MD
- Founded
- 1939
- FDD year
- 2024
- States available
- 40
FDD Item 7 · 2024 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $50K | $50K |
| Equipment, build-out, other | $8.6M | $15.7M |
| Total initial investment | $8.7M | $15.8M |
Source: MainStay Suites 2024 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$241K
11.5% margin
Unlevered ROIC
2%
EBITDA / total invested capital
Payback
51.7 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $8.7M – $15.8M
- Better than avg vs category
- Liquid capital req'd
- N/A
- Near category avg vs category
- Franchise fee
- $50K – $50K
- Better than avg vs category
- Royalty
- 6.0%
- Gross Room Revenues · typical 6–8%
- Ad fund
- 2.5%
- typical 3–5%
- Total fee load
- 8.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 2.5% of gross sales |
| Technology fee | $472 |
| Transfer fee | $50K |
| Total fee load | 8.5% of rev |
Financial Performance
- Avg gross sales
- $2.1M
- Per unit, per year
- Median gross sales
- $2.1M
- Item 19 type
- Historical Average Occupancy, ADR, and RevPAR
- Sample size
- 112 units
- vs category median 100
- Range (low → high)
- $347K→$5.1M
- Cohort dispersion (min → max)
- Transparency tier
- limited
- Categorical assessment of disclosure depth
- Reporting year
- 2023
- Fiscal year the figures cover
- Transparency
- 4 / 5
- vs category median 0 / 5 · above
Compared against 245 Lodging brands
Revenue is only 0.2x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
vs Lodging averages
How MainStay Suites Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 126
- Opened
- 14
- Last reporting year
- Closed
- 3
- Turnover rate
- 2.4%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +9.6%
- Net unit change last year
- 3-yr CAGR
- +24.8%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 11
- Closed (3yr)
- 1
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 1
- Transfers (3yr)
- 2
- Reacquired (3yr)
- 0
- Franchisor bought back
- Termination rate
- 1.1%
- Franchisor-initiated terminations
- Ceased ops
- 1.1%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 30 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 loan disclosures. This brand has only 9 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 9
- Loan volume
- $15.7M
- Median loan
- $1.3M
- 50th percentile
- Charge-off rate
- 22.2%
- 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)
- 77.8%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 9
- Defaults
- 2
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into MainStay Suites's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 9 lenders with concentration factor
- Per-state charge-off rates across 7 states
- Startup risk premium and job creation velocity
- 7-year lending trend
- SBA 504 real estate/equipment data
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
MainStay Suites presents elevated risk due to franchisor's aggressive litigation posture (71 royalty actions annually), opaque profitability metrics, anemic unit growth, and high capital requirements relative to disclosed revenues.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Ernst & Young LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 66 / 100 rating
- 01HIGHAggressive litigation pattern: 71 royalty recovery actions in one fiscal year suggests systemic collection issues or franchisee financial distress
- 02MEDHigh investment threshold ($8.7M–$15.8M) with undisclosed net income creates opacity on actual profitability and ROI
- 03MEDModest unit growth (9.6% YoY) with 126 units is underwhelming for a branded economy hotel chain; limited scale advantages
- 04MINORSignificant post-termination IP enforcement actions (12 cases) indicate compliance/brand protection problems among departed franchisees
- 05MEDRevenue-to-investment ratio concern: $2.1M average revenue against $8.7M–$15.8M investment suggests 5–8 year payback at best, before accounting for undisclosed expenses
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 | 20 years |
|---|---|
| Allowed renewalsℹ | 0 |
| Territory type | Radius |
| Protected territory | Yes |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Termination notice | 30 days |
| Termination groundsℹ | 3 |
| Curable defaultsℹ | 6 |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Maryland |
| Litigation count | 90 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 57 hrs
- On-the-job training
- 105 hrs
- Training location
- On-site and corporate
- Site selection
- franchisor
- Franchisor financing
- Offered
- Item 10
- POS system
- choiceADVANTAGE
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: choiceADVANTAGE
Item 20 · call current owners
Franchisee Contacts
60 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
MainStay Suites · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a MainStay Suites franchise?
The total investment to open a MainStay Suites franchise ranges from $8.7M – $15.8M, with an initial franchise fee of $50K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do MainStay Suites franchise owners earn?
According to Item 19 of the MainStay Suites FDD, the average gross sales per unit is $2.1M. The median is $2.1M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is MainStay Suites's franchise failure rate?
SBA 7(a) loan charge-off data is not available for MainStay Suites (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 MainStay Suites franchise locations are there?
As of their most recent FDD filing, MainStay Suites has 126 total units in the United States, including 101 franchised units and 0 company-owned units. 14 new units were opened in the latest reporting year.
Is MainStay Suites a good franchise to buy?
FranchiseVerdict rates MainStay Suites as a C-grade franchise with a risk score of 66 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.