Motel 6Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Motel 6 franchise requires a total initial investment of $195K – $8.2M, including a $25K franchise fee and an ongoing 5.0% royalty[2]. The 2025 FDD does not disclose unit-level revenue (no Item 19). SBA 7(a) loans show a 4.6% charge-off rate across 615 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $195K – $8.2M
- 11th pct Lodging
- Avg gross sales
- N/A
- 2nd pct Lodging
- Royalty
- 5.0%
- 4th pct Lodging
- Units
- 1,195
- 52nd pct Lodging
- SBA default
- 4.6%
- 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
Large franchise systems benefit from brand recognition, supply chain leverage, and proven operations.
Bottom line
- Total investment $195K – $8.2M including a $25K franchise fee, 5.0% ongoing royalty.
- Item 19 discloses "Historical Average Occupancy Rate, Average Daily Rate, and Average RevPAR" rather than annual gross sales, so unit revenue is not directly comparable.
- Verdict A (Top Quintile) with a risk score of 32/100. SBA loan charge-off rate of 4.6% across 615 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- Item 19 reports "Historical Average Occupancy Rate, Average Daily Rate, and Average RevPAR" instead of annual gross sales. Ask franchisees directly for full unit-level revenue.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- G6 Hospitality Franchising LLC
- Parent company
- OYO Hotels Inc.
- CEO title
- Chief Executive Officer
- Gautam Swaroop
- Incorporated in
- DE
- HQ
- 2633 McKinney Avenue, Suite 130-524, Dallas, Texas 75204
- Auditor
- JLK Rosenberger, LLP
- Audited financials
- Franchisor revenue
- $70.8M
- vs $72.1M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Motel 6 franchisees operate budget-tier hotel properties, managing daily guest check-ins/check-outs, housekeeping, maintenance, front desk operations, and ancillary services. Franchisees pay 5% royalty on gross room revenues to G6 Hospitality while maintaining brand standards, adhering to safety/privacy protocols, and competing in the economy lodging segment.
- CEO
- Gautam Swaroop
- Headquarters
- TX
- Founded
- 2005
- FDD year
- 2025
- States available
- 50
FDD Item 7 · 2025 filing · 20 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Market Feasibility Study | $0 | $15K | |
| Property Ownership or Acquisition Costs | — | — | |
| Initial Fees Paid to Us | $41K | $41K | |
| Opening Extension Fee | — | — | |
| Ancillary Trip Fee | — | — | |
| Architectural, Design Fees (Planning & Due Diligence) | $0 | $270K | |
| Site and/or Civil Work | $0 | $250K | |
| Construction Expenses | $0 | $6.3M | |
| Construction Contingency | $0 | $315K | |
| Furniture, Fixtures & Equipment (FF&E) | $17K | $556K | |
| FF&E Contingency | $0 | $28K | |
| Signage | $6K | $61K | |
| WIFI Infrastructure | $0 | $10K | |
| Telephone System | $700 | $10K | |
| PMS and Credit Card Processing Equipment | $4K | $6K | |
| Opening Inventory & Supplies | $27K | $190K | |
| Insurance | — | — | |
| Utility Deposits | — | — | |
| Grand Opening Expense | $0 | $5K | |
| Additional Funds for Initial Phase (3 months of operations) | $100K | $160K | |
| Total initial investment | $195K | $8.2M |
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
- $195K – $8.2M
- Better than avg vs category
- Liquid capital req'd
- $100K – $160K
- Better than avg vs category
- Franchise fee
- $25K – $25K
- Better than avg vs category
- Royalty
- 5.0%
- Gross Room Revenues · typical 6–8%
- Ad fund
- 3.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 3.0% of gross sales |
| Technology fee | $300 |
| Transfer fee | $13K |
| Renewal fee | $13K |
| Total fee load | 8.0% of rev |
Financial Performance
This brand's FDD disclosed "Historical Average Occupancy Rate, Average Daily Rate, and Average RevPAR" 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 Motel 6 Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 1,195
- Opened
- 48
- Last reporting year
- Closed
- 59
- Terminated
- 59
- Franchisor ended the franchise (per Item 20)
- Turnover rate
- 4.9%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- -0.9%
- Net unit change last year
- 3-yr CAGR
- -1.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 44
- Transfer rate
- 3.7%
- Owners selling to other franchisees
- Continuity rate
- 95.3%
- Units that stayed open
- Termination rate
- 4.9%
- Franchisor-initiated terminations
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 5 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
- 615
- Loan volume
- $1.3B
- Median loan
- $2.0M
- 50th percentile
- Charge-off rate
- 4.6%
- 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)
- 97.2%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 136
- Defaults
- 14
Vintage analysis
Motel 6 charge-off rate by loan vintage
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Motel 6's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 27-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
Motel 6 presents CAUTION-level risk: a declining budget hotel system with serious data privacy litigation, multiple franchise disputes, zero financial transparency, and revenue/income figures withheld from disclosure.
Litigation (Item 3)
Two cases involving MS & Sons Hospitality, LLC (pending) and Park Property Management, LLC (prior action). G6 Hospitality terminated MS & Sons on May 26, 2023 for default and fraudulent records. MS & Sons filed federal suit in California (June 23, 2023) alleging breach of contract and unfair business practices; G6 filed counterclaim in Texas state court (September 5, 2023) and received default judgment. Park Management case filed November 16, 2018 in Utah state court alleging breach of contract, fraud, and misrepresentation; outcome not specified in excerpt.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · JLK Rosenberger, LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: Yes
Score breakdown · what drove the 32 / 100 rating
- 01MINORDeclining unit count (-0.9% YoY) signals shrinking franchise system despite 1,195 locations
- 02MEDNo disclosed average revenue or net income (Item 19) prevents financial performance validation and suggests weak or inconsistent unit economics
- 03HIGHMultiple active litigation cases including franchise termination disputes, data privacy class actions, and franchisor collection actions indicate systemic operational and legal friction
- 04HIGHData privacy litigation (Jane V. class action, Washington State action) over guest information disclosure to immigration authorities creates reputational and operational liability risk
- 05MINORFranchisor initiating collection actions against franchisees (G6 Hospitality vs. Aesha LLC) suggests cash flow stress among operators
- 06MED20-year term length is lengthy for a declining brand with limited financial transparency
- 07MEDHigh investment ceiling ($8.2M) with 5% royalty on undisclosed revenues creates uncertainty on ROI calculations
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 |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 1 |
| Territory type | Market area |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | Texas |
| Litigation count | 5 |
View Item 3 litigation summary
Two cases involving MS & Sons Hospitality, LLC (pending) and Park Property Management, LLC (prior action). G6 Hospitality terminated MS & Sons on May 26, 2023 for default and fraudulent records. MS & Sons filed federal suit in California (June 23, 2023) alleging breach of contract and unfair business practices; G6 filed counterclaim in Texas state court (September 5, 2023) and received default judgment. Park Management case filed November 16, 2018 in Utah state court alleging breach of contract, fraud, and misrepresentation; outcome not specified in excerpt.
Items 10, 11
Training & Operations
- Classroom training
- 12 hrs
- On-the-job training
- 0 hrs
- Training location
- On-site and off-site
- POS system
- HotelKey
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: HotelKey
Item 20 · call current owners
Franchisee Contacts
99 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Motel 6 · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Motel 6 franchise?
The total investment to open a Motel 6 franchise ranges from $195K – $8.2M, with an initial franchise fee of $25K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Motel 6 franchise owners earn?
Motel 6 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 Motel 6's franchise failure rate?
Based on SBA 7(a) loan data, Motel 6 has a charge-off rate of 4.6% across 615 loans, meaning 4.6% 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 Motel 6 franchise locations are there?
As of their most recent FDD filing, Motel 6 has 1,195 total units in the United States, including 1,195 franchised units and 0 company-owned units. 48 new units were opened in the latest reporting year.
Is Motel 6 a good franchise to buy?
FranchiseVerdict rates Motel 6 as a A-grade franchise with a risk score of 32 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.