MHO Hotels Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
MHO Hotels is a hotel franchise operating midscale lodging properties. Franchisees own and operate the hotels, managing front desk, housekeeping, and revenue under brand standards.
FranchiseVerdict summary · 2026
A MHO Hotels franchise requires a total initial investment of $72K – $1.2M, including a $10K franchise fee. The 2025 FDD does not disclose unit-level revenue (no Item 19). FranchiseVerdict grade: D (Below average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $72K – $1.2M
- 2nd pct Lodging
- Avg gross sales
- N/A
- Royalty
- N/A
- Units
- 4
- 15th pct Lodging
- SBA charge-off
- N/A
Quick verdict · Lodging · color = vs category peers
Green = favorable by >10% vs Lodging avg · 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 $72K – $1.2M including a $10K franchise fee.
- RETURNSThe provided page images (p193-p198) contain Exhibit H (Franchise Disclosure Questionnaire), Exhibit I (State Effective Dates), and Exhibit J (Receipts) for Membership Hotel Organization LLC, MHO/FDD/2025v1, issuance date April 4, 2025. No audited financial statements (Exhibit B / Item 21), no balance sheet, no income statement, and no Independent Auditor's Report appear in this folder. All financial figures are therefore null.
- RISKVerdict D (Below average), verdict score 36/100 (higher is better).
- DATANo Item 19 financial performance representation. Without franchisor-disclosed revenue data, you'll need to gather unit economics directly from existing franchisees.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Membership Hotel Organization LLC
- CEO title
- President and CEO
- Mahendra Patel
- Incorporated in
- NJ
- HQ
- 187 Route 130, Bordentown, New Jersey 08505
- Auditor
- Sai CPA Services
- Audited financials
- Franchisor revenue
- $25K
- vs $31K prior year
Overview
About
- CEO
- Mahendra Patel
- Headquarters
- NJ
- Founded
- 2020
- FDD year
- 2025
- States available
- 2
Can you afford it, and what does the money buy?
Entry cost runs 93% below the typical lodging franchise.
Source: FDD 2025 · Items 5–7
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $10K | $10K |
| Working capital (3–6 mo) | $50K | $300K |
| Equipment, build-out, other | $12K | $935K |
| Total initial investment | $72K | $1.2M |
Source: MHO Hotels 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $72K – $1.2M
- Top 40% of category vs category
- Liquid capital req'd
- $50K – $300K
- Top 40% of category vs category
- Franchise fee
- $10K – $10K
- Top 40% of category vs category
- Royalty
- $26.95 per room per month (per-room option) OR $2.00 per …
- Ad fund
- 5.0%
- typical 3–5%
- Total fee load
- 31.9%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty (flat) | Two options: (i) $26.95 per room per month, or (ii) $2.00 per occupied room per night |
| Marketing / ad fund | 5.0% of gross sales |
| Technology fee | $26 |
| Training fee | $5K |
| Transfer fee | $10K |
| Renewal fee | $5K |
| Inventory (initial) | $100 – $5K |
| Total fee load | 31.9% of rev |
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
MHO Hotels did not disclose financial performance in FDD Item 19. The ROIC and return models require Item 19 revenue. Without it all inputs are estimates. You can still run the calculator with your own assumptions by entering an expected revenue figure.
Returns model · single-unit ROIC
What would one MHO Hotels unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
8%
Below the 30–60% attractive-franchise band
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: 2025 FDD
Financial Performance
The provided page images (p193-p198) contain Exhibit H (Franchise Disclosure Questionnaire), Exhibit I (State Effective Dates), and Exhibit J (Receipts) for Membership Hotel Organization LLC, MHO/FDD/2025v1, issuance date April 4, 2025. No audited financial statements (Exhibit B / Item 21), no balance sheet, no income statement, and no Independent Auditor's Report appear in this folder. All financial figures are therefore null.
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 31.9% — above the Lodging average of 10.4%.
Disclosure
Franchisor chose not to disclose financial performance representations. You will need to gather unit economics directly from existing franchisees.
Operator retention
Net unit growth roughly flat at 0.0%.
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 averages
How MHO Hotels Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 4
- Opened
- 0
- 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
- 0.0%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 75%
- vs corporate-owned
- Net growth (3-yr)
- +0.0%
- Net unit change over 3 years
- 3-yr CAGR
- +0.0%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 0
- Closed (3yr)
- 0
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 0
- Reacquired (3yr)
- 0
- Franchisor bought back
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)
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 2 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 2
- Loan volume
- $1.9M
- Median loan
- $928K
- average
- Charge-off rate
- N/A
- limited sample (2 loans) — rate not shown below 10
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 0
- Defaults
- N/A
Explore lender portfolios on Bank Reports or regional data on State Reports.
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
MHO Hotels presents HIGH RISK due to a 4-unit system with no growth trajectory, missing financial disclosures, false going concern status, unprotected territory, and inadequate royalty/fee transparency—typical of early-stage or distressed franchise systems.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Largest disclosed settlement: $9,995
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Sai CPA Services
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
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 36 / 100 verdict
- 01MINOROnly 4 units in system with unknown/likely stagnant growth indicates minimal market traction and unproven model scalability
- 02MINORNo average revenue or net income disclosure (no Item 19) prevents validation of ROI claims and profitability assumptions
- 03HIGHGoing Concern status is FALSE, suggesting potential financial instability at corporate level and franchise support risk
- 04MINORNo protected territory creates direct competition risk between franchisees and leaves door open for brand saturation
- 05MINORDual royalty options without guidance on which is standard/recommended suggests lack of transparent pricing strategy
- 06MINORExtremely low franchise fee ($9,995) relative to hotel capex may indicate weak corporate infrastructure and minimal franchisor support
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 31.9% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2025 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 1 |
| Territory type | none |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Territory population | 2,000,000 |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | Yes |
| RoFR response window | 30 days |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Termination groundsℹ | 1 |
| Curable defaultsℹ | 3 |
| Mandatory arbitration | Yes |
| Arbitration location | Bordentown, New Jersey (principal city closest to franchisor's principal place of business) |
| Jury trial waiver | Yes |
| Governing law | NJ |
| Litigation count | 0 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 29 hrs
- On-the-job training
- 0 hrs
- Training location
- Virtual (online)
- Ongoing training
- Required
- Time to open
- 2 mo
- From signing to launch
- Franchisor financing
- Not offered
- Item 10
- POS system
- Stayflexi
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Stayflexi
Item 20 · call current owners
Franchisee Contacts
2 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
MHO Hotels · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a MHO Hotels franchise?
The total investment to open a MHO Hotels franchise ranges from $72K – $1.2M, with an initial franchise fee of $10K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do MHO Hotels franchise owners earn?
MHO Hotels 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 Item 19 in the MHO Hotels 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 MHO Hotels FDD and qualifies whose outlets they describe.
What is MHO Hotels's franchise failure rate?
SBA 7(a) loan charge-off data is not available for MHO Hotels (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 MHO Hotels franchise locations are there?
As of their most recent FDD filing, MHO Hotels has 4 total units in the United States, including 3 franchised units and 1 company-owned units.
Is MHO Hotels a good franchise to buy?
FranchiseVerdict rates MHO Hotels as a D-grade franchise with a verdict score of 36 out of 100 (higher is better), 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.
For franchisors
Are you the franchisor?
If you represent MHO Hotels, 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.