MHO Hotels Franchise Cost, Revenue & Review 2026
- Investment
- $72K – $1.2M
- Disclosed sales
- not disclosed
- SBA charge-off
- Under 10 loans (2)
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. 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: C (Average), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: medium - issued 12 to 24 months ago; a newer filing is likely on file
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 scored4 of 4 headline figures on this page cite a page of the filing.
Overview
- Investment
- $72K – $1.2M
- 2nd pct Lodging
- Avg gross sales
- N/A
- Royalty
- Flat fee
- Units
- 4
- 14th 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 $72K – $1.2M including a $10K franchise fee.
- 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 C (Average), verdict score 41/100 (higher is better).
- GROWTHFlat: no net change in franchised outlets in the latest year (0 opened, 0 closed) (Item 20).
- DATAThis 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.
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 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 MHO Hotels 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, royalty rate, 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: 2025 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 31.9% — above the Lodging median of 8.5%.
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 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 medians
How MHO Hotels 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 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
- N/A
- 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
Last fiscal year · Item 20 exits and transfers
- Terminated
- 0
- Not renewed
- 0
- Transferred
- 0
- Reacquired
- 0
- Franchisor bought back
- Signed, not yet open
- 0
- 0.00 per open outlet · Item 20 Table 5
- Projected new
- 7
- Franchisor's next-year forecast
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)
Where the owners are · Item 20 owner list
0 current owners across 0 states; 2 former (terminated, transferred or not renewed) listed separately.
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
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
- Under 10 loans (2)
- Insufficient SBA coverage: 2 loans, rate hidden below 10
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- Under 10 loans (2)
- 5-yr charge-off
- Under 10 loans (2)
- 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)
Subject: officers or affiliates. The franchisor is not a named party in these cases.
0 case reference(s): 0 pending, 0 settled.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Sai CPA Services
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
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.
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 41 / 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
- 03MINORNo protected territory creates direct competition risk between franchisees and leaves door open for brand saturation
- 04MINORDual royalty options without guidance on which is standard/recommended suggests lack of transparent pricing strategy
- 05MINORExtremely 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 | No territory protection |
| 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
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 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 MHO Hotels?
MHO Hotels is franchised by Membership Hotel Organization LLC. Source: FDD Item 1, 2025 filing.
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 C-grade franchise with a verdict score of 41 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?
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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.