Bottom line
- Total investment $19.4M including a $100K franchise fee, 5.0% ongoing royalty.
- No Item 19 financial performance data disclosed — the franchisor chose not to publish revenue figures.
- Rated CAUTION with a risk score of 75/100.
- 15 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
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Motto by Hilton unit return on the cash you put in?
Unlevered ROIC · per unit
0%
Below typical band (30–60%)
Overview
About
Franchisees own and operate limited-service hotel properties under the Motto by Hilton brand, a Hilton subsidiary focused on affordable, design-forward accommodations. Daily operations include front desk/housekeeping management, guest services, revenue management (subject to Hilton's centralized software and mandatory fee structures), marketing coordination with the parent brand, and compliance with brand standards while remitting 5% royalties on all room revenue.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 13 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 phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Motto by Hilton is an extremely early-stage, litigation-plagued brand with only 6 units, zero financial transparency, and unresolved legal/regulatory disputes that create substantial operational and financial risk for new franchisees.
Score breakdown · what drove the 75 / 100 rating
- 01MINOROnly 6 units systemwide with minimal growth trajectory (20% YoY = 1.2 new units) indicates nascent, unproven brand with no economies of scale
- 02MINORMultiple class action antitrust lawsuits plus state attorney general investigations into mandatory fees create regulatory/legal liability exposure and reputational risk
- 03MEDNo disclosed average revenue or net income (missing Item 19) prevents prospective franchisees from validating unit economics or ROI projections
- 04MINORContract disputes with former franchisees regarding termination and brand standards suggest operational/enforcement issues and franchise relationship friction
- 05MINORUnprotected territory combined with ultra-long 22-year term locks franchisee into potentially uncompetitive position without geographic exclusivity
- 06HIGHGoing Concern designation absent (False) but combined with 6-unit system and litigation suggests financial instability or parent company concerns
- 07MINOR5% royalty on Gross Rooms Revenue (not Net) means fees apply regardless of profitability, increasing downside risk in market downturns
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
16 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Motto by Hilton · FDD (2026) PDF