Radisson Hotels Franchise Cost & 2024 FDD Data
50/100
Second tier
50 this brand65 Lodging medianlikely 34–66: narrower with more SBA loans and a newer filing (low confidence)
Higher is better · an editorial assessment, not investment advice
#1,695 of 3,069 graded brands
Why a B: Helped by financial health, scale and transparency. Held back by unit growth. See all six factors
- Total investment
- $10.0M – $54.7M
- excl. real estate
- Avg gross sales
- partial, no system average
- SBA charge-off
- 4 resolved of 5 loans: too few to judge
Data from the FDD filing + SBA 7(a) records. Analysis by FranchiseVerdict · Methodology · Website · Report an error · Franchisor? Claim this listing
This data is from a 2024 FDD. Current terms may differ. Always verify with the franchisor's latest disclosure document.
FranchiseVerdict summary · 2024 FDD
Per the 2024 FDD, a Radisson Hotels franchise requires a total initial investment of $10.0M – $54.7M, excluding real estate, including a $75K franchise fee. Once open, the ongoing royalty is 6.0%. The 2024 FDD on file does not yield a unit-revenue figure we can publish. Verdict grade: B (Second tier), an editorial assessment, not investment advice.
Sources: 2024 FDD · What one unit could make and lose →
Sources, dates and evidence
FDD issued: · Last cited check: · Staleness risk: high (issued more than two years ago)
Evidence for the headline figures: partial✓ 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 5 headline figures on this page cite a page of the filing; the rest are marked “Not cited” beside the figure.
Overview
Quick verdict · vs Lodging median
Top edge: green = better than the Lodging median by more than 10%, red = worse by more than 10%, gray = within 10% or no benchmark. Source: FDD filings + SBA 7(a).
Data from public FDD filings and SBA records. Methodology
Bottom line
- RETURNSItem 19 reports hotel occupancy metrics rather than annual gross sales, so the figure is not directly comparable.
- GROWTHIn the latest Item 20 year, the number of franchised outlets fell by 5 (1 opened, 6 closed).
- LEGAL57 litigation matters disclosed in Item 3, higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
AT STAKEOne unit at the Item 7 midpoint: $810K a year in payments on assumed SBA 7(a)-style terms.You put in about $27.4M of your own cash and personally guarantee a $5.0M loan. Assumptions are labeled in Sales; not investment advice.See what one unit could make and lose
Things to check before you sign (5)
- Net -5 franchised outlets in 2023 (Item 20, outlet counts). Ask owners why outlets closed.
- The franchisor keeps the right to compete inside your territory (Item 12, territory).
- You waive a jury trial in disputes with the franchisor (Item 17, renewal, termination and disputes).
- The franchisor receives rebates or payments from suppliers you buy from (Item 8, required suppliers).
- Limited data: this page holds only part of the filing. Read the FDD itself before relying on any figure here.
Checked and clear: no auditor doubt that the franchisor can keep operating and no rule that the owner must run it personally. Not on file here, so ask: pending litigation and SBA charge-off rate against the category median.
What to do next
Step 1: Read the FDD itself.
Free: the franchisor must give it to you at least 14 days before you sign or pay. Or look it up in a state registry (Wisconsin, Minnesota, California). What to read first.
Step 2: Talk to current and former owners.
Free: Item 20 of the FDD lists every current owner and those who left last year, most with a phone number. Questions to ask.
Step 3: Talk to an SBA lender.
Free: the SBA's Lender Match. Ask what you would personally guarantee and what the monthly payment would be. If you plan to use retirement savings, ask a CPA about the rules for that first.
Step 4: Have a franchise attorney review the FDD and agreement.
Free: your state bar's lawyer referral service can name franchise lawyers, and many offer a short first consultation. Bring the checks listed above.
Research steps, not investment or legal advice.
Can you afford it, and what does the money buy?
Entry cost (the Item 7 midpoint) is 3.8× the Lodging median ($8.5M).
Source: FDD 2024 · Items 5–7 (fees and startup costs)
Do you qualify? The filing states no minimum net worth or liquid capital. Ask Choice Hotels International, Inc. (Item 1: 915 Meeting Street, Suite 600, North Bethesda, Maryland 20852) and your lender what they require, and keep living costs for the first year outside the deal.
FDD Item 7 (startup costs) · 2024 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $75K | $75K |
| Working capital (first 3 months) | $1.0M | $1.8M |
| Equipment, build-out, other | $9.0M | $52.8M |
| Total initial investment | $10.0M | $54.7M |
Source: Radisson Hotels 2024 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 6 · what you pay once you are open
Ongoing fees
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 3.0% of gross sales |
Technology feesThe filing's detailEstimated pre-opening cost for ORACLE Opera Cloud PMS (implementation fees $14,000 to vendor, Technology & Interface Connect Fee $2,400 to franchisor, PMS Payment Gateway Fee $150, Equipment/Hardware $13,000) for average 200-room property | See the list |
| Total fee loadnear the Lodging median of 8.5% | 9.0% of sales |
What do units actually make?
Source: FDD 2024 · Item 19 (sales and earnings)
Items 6 (other fees), 7 (startup costs) and 19 (sales and earnings) · assumptions labeled
What you could make and lose: one unit
What one Radisson Hotels unit would ask of you, from the filing's Item 7 total and labeled assumptions.
How these figures are worked out
- Loan (assumption): 80% of the $32.4M Item 7 midpoint is a $5.0M loan, capped at the SBA 7(a) program's $5.0M limit, paid over 10 years at 10.5%: $810K a year. SBA 7(a)-style terms on a long-term rate; your lender sets yours.
What you put at risk
Your own cash in: about $27.4M Assumption (the part the loan does not cover of the $32.4M Item 7 midpoint), plus whatever anything Item 7 leaves out (its notes say what). The loan is $5.0M.
Personal guarantee. SBA 7(a) loans require a personal guarantee from anyone who owns 20% or more of the business. If the unit cannot pay, the lender can collect from you personally, which can include your savings and your home. The worst case is losing the cash you put in and still owing the rest of the loan.
Gross sales are not profit, and none of these figures is take-home pay until tax and every operating cost are paid. The assumptions are ours, not the filing's. Not investment advice.
Returns modelOne unit · several units · editable
Item 19 of the Radisson Hotels FDD discloses figures for part of the system but no single average across all outlets. The return models need one gross sales figure to start from, plus the operating costs that turn gross sales into a profit. Enter your own and the calculator runs on your assumptions; nothing here is modelled until you do.
Returns model · one unit
What would one Radisson Hotels unit leave you each year after the loan payment?
Not disclosed in Item 19. Enter your own gross sales assumption
Gross sales, not profit: the costs below decide what is left.
No Item 19 figures are on file for this brand. Enter your own costs from a lease quote, a payroll plan and calls with current owners.
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.
Item 7 midpoint of $10.0M to $54.7M
Item 7's $1.0M to $1.8M additional funds are already in the total
Left after the loan payment · per year
The unit's EBITDA minus the assumed loan payment. Before tax, depreciation and any cost your inputs leave out (insurance, accounting and legal, licenses, technology fees): not take-home pay.
Gross sales are not profit. Neither the filing nor a stated assumption on this page supplies annual revenue, direct costs, labor, rent / occupancy and other operating costs. Enter your own (a lease quote, owner calls) and the model runs on it.
Loan of $5.0M at 10.5% over 10 years, an assumption, not a quote. Return and payback are before tax, depreciation and the costs above. The loan usually needs your personal guarantee.
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: 2024 FDD · filed by Choice Hotels International, Inc.
Financial performance
Percentile ranks within Lodging
Each rank is among the Lodging brands that report that figure (the count is under each bar).
vs Lodging medians
How Radisson 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.
Who are you contracting with?
Choice Hotels International, Inc.
Same franchisor, other programs: ASCEND HOTEL COLLECTION, Clarion / Clarion Pointe, Comfort Inn, Country Inn & Suites by Radisson, Econo Lodge, Everhome Suites, MainStay Suites, Park Inn by Radisson, RODEWAY INN, Radisson Blu, Radisson Individuals, Sleep Inn, Suburban Studios, WoodSpring Suites. Each is a separate offering with its own page.
Item 1 (the franchisor) · who you're contracting with
The franchisor
Corporate structure & franchisor financials
- Legal entity
- Choice Hotels International, Inc.
- Parent company
- Choice Hotels International, Inc.
- FDD Item 1, page 9 of the 2024 FDD
- Predecessor
- Radisson Hotels International, Inc.
- Prior franchisor entity
- CEO title
- Director, President and Chief Executive Officer
- Patrick S. Pacious
- Incorporated in
- Delaware
- HQ
- 915 Meeting Street, Suite 600, North Bethesda, Maryland 20852
- Auditor
- Ernst & Young LLP
- Audited financials
- Franchisor revenue
- $1.5B
- latest fiscal year in the 2024 FDD; $1.4B the year before
Same owner · FDD Item 1, page 9
13 other brands on this site name Choice Hotels International, Inc. as parent or ultimate parent in their own FDD.
- ASCEND HOTEL COLLECTION (grade B)
- Clarion / Clarion Pointe (grade B)
- Comfort Inn (grade A)
- Country Inn & Suites by Radisson (grade A)
- Econo Lodge (grade B)
- Everhome Suites (grade B)
- MainStay Suites (grade A)
- Park Inn by Radisson (grade B)
- RODEWAY INN (grade B)
- Radisson Individuals (grade C)
- Sleep Inn (grade A)
- Suburban Studios (grade A)
- WoodSpring Suites (grade B)
Grouped by the owner's name as each filing prints it (this page: the 2024 FDD). Spelling variants of the same group may be listed apart; a brand is never grouped with an owner its filing does not name.
Overview
About
Radisson franchisees operate upscale hotel properties, managing daily operations including housekeeping, front desk, food & beverage, maintenance, and guest services. Revenue derives from room bookings and ancillary hotel services, with corporate franchisor retaining 6% of gross room revenues regardless of profitability, plus marketing and other assessed fees.
- CEO
- Patrick S. Pacious
Is the system healthy?
-18 franchised outlets over the two years to 2023 (70 to 52, -25.7% in total, -13.8% a year compounded).
Source: FDD 2024 · Item 20 (outlets opened, closed and transferred)
Item 20 (outlet counts) · unit dynamics
The growth chart
- Company-owned
- 6
- Corporate units in the system
- % franchised
- 90%
- vs corporate-owned
Last fiscal year · Item 20 rates and pipeline
- Reacquired
- 0
- Franchisor bought back
- Signed, not yet open
- 15
- 0.26 per open outlet · Item 20 Table 5
- Projected new
- 1
- Franchisor's next-year forecast
Item 20 · franchised units at year end
Franchised units fell from 70 in 2021 to 52 in 2023
Axis does not start at zero.
Source and method
A system that lost more than 10% of its franchised outlets across the Item 20 years is a red flag. Check whether closures are concentrated in specific regions.
Government records
SBA loan data
Aggregated from SBA loan disclosures. This brand has only 5 7(a) loans on file; statistical reliability is limited below 10 loans.
- Loans on file
- 5
- SBA 7(a) loans matched to this brand, incl. those still being repaid
- Loan volume
- $4.4M
- Average loan
- $886K
- loan volume divided by loans
- Charge-off rate
- 4 resolved of 5 loans: too few to judge
- Insufficient SBA coverage: 5 loans, rate hidden below 10
- Paid in full
- 4 resolved of 5 loans: too few to judge
- Recent-loan charge-off
- 4 resolved of 5 loans: too few to judge
- Lenders
- 2
Cumulative: every 7(a) loan matched to this brand in the SBA’s FOIA files, approved FY1991 onward. Historical lending data, not predictive of future performance. How SBA charge-off rates are calculated
Explore lender portfolios on Bank Reports or regional data on State Reports.
What are the risks?
Main risk: a shrinking system. Franchised outlets fell from 70 to 52 over the two years to 2023.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Verdict grade + FDD Items 3 (litigation), 4 (bankruptcy), 8 (required suppliers), 16 (what you may sell), 21 (audited financials)
Risk and legal
Grade B: Second tier, 50/100 (category median 65); the full grade is at the top of the page.
How the grade is built
Why a B, factor by factor
- Financial health HelpsAudited financials; no going-concern doubt; statements are the parent's, so this stays near neutral
- Unit economics NeutralNo Item 19 sales figure to set against the investment, so neutral
- Unit growth Weighs on it, weakest dimension-18 franchised outlets over the two years to 2023 (70 to 52, -25.7% in total, -13.8% a year compounded); turnover 10.3%
- Scale Helps52 franchised units, +6 company-owned (58 in all); franchising since 1983
- Legal NeutralItem 3 covers the franchisor's whole portfolio, so no matter is attributed to this brand (neutral)
- Transparency HelpsItem 19 discloses financial performance; audited financials
- Adjustments after the six dimensions (+1 point)Rounding: the score is kept as a whole number, which moved it by 1 point.
From the six scored dimensions, an editorial assessment, not investment advice. How the score is built
Litigation (Item 3)
Subject: the franchisor is a named party (defendant).
Multiple pending matters including a Canadian class action re: destination marketing fees ($403M demanded), a multi-plaintiff RICO/antitrust suit by ~90 franchise owners (stayed, compelled to arbitration), and a breach-of-contract/trade-secrets suit by a Country Inn & Suites licensee. A large number (~48) of arbitration/court actions initiated by Choice against franchisees to recover unpaid royalties and other debts in the prior fiscal year. Resolved matters include a $779,398 final judgment against Choice (Highmark Lodging arbitration) and an $85,000 settlement paid by Choice (Sender Kohl).
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Ernst & Young LLP
Franchisor revenue (Item 21)
The revenue figures are in the Franchisor tab, under The franchisor.
Franchisor entity revenue (not unit-level)
Franchisor (Choice Hotels International) FY2023 total revenues include royalty/licensing/management fees $513,412K, initial franchise fees $27,787K, platform/procurement fees $75,114K, owned hotels $97,641K, other $46,051K, and pass-through revenues from franchised/managed properties $784,160K
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results; the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
Ask what the franchisor earns on the supplies it sells you or the rebates it takes (Item 8).
- Franchisor sells you products: Yes
- Franchisor takes supplier rebates: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
What are you signing up for?
Ongoing fees run about 9.0% of sales (royalty + ad fund), before your own operating costs.
Source: FDD 2024 · Items 11, 12, 17
FDD Items 12 (territory), 15 (owner participation) and 17 (renewal, termination and disputes)
Contract and territory detail
| Protected territory | No |
|---|---|
| Territory condition | Franchises are granted for specific sites only; no exclusive territory unless franchisor grants one at its discretion based on market conditions and franchisee history; franchisor reserves right to open company-owned hotels or franchise other Choice brands at any location, including near franchisee's Hotel |
| Exclusive territory | No |
| Franchisor can compete | Yes |
| Who runs it (Item 15) | Owner-operator not required |
| Right of first refusal | Yes |
| RoFR response window | 90 days |
| Transfer requires consent | Yes |
| Termination notice | 365 days |
| Mandatory arbitration | Yes |
| Arbitration location | Maryland |
| Jury trial waiver | Yes |
Items 10 (financing), 11 (training and support)
Training and operations
- Ongoing training
- Required
- Site selection
- Franchisor must approve site selected by franchisee; Franchise Committee reviews applications within 60 days
- Franchisor financing
- Offered
- Item 10
Items 5 (initial fees) & 11 (training and support)
Franchisor support
Franchisee contacts
We hold no owner list for this brand. Item 20 of the FDD lists the current and former owners; the free FDD is the source.
Frequently asked questions
How much does it cost to open a Radisson Hotels franchise?
Per the 2024 FDD, the total investment to open a Radisson Hotels franchise ranges from $10.0M to $54.7M, with an initial franchise fee of $75K. This is the Item 7 total in the Franchise Disclosure Document (FDD): the startup costs the franchisor lists, such as build-out, equipment, inventory and working capital. The filing says these totals do not include real estate.
What do Radisson Hotels franchise owners earn?
Item 19 of the Radisson Hotels FDD discloses figures for part of the system but no single average across all outlets. These are gross sales figures, not profit; the Revenue section shows what the filing reports and on what basis. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Who owns Radisson Hotels?
Radisson Hotels is franchised by Choice Hotels International, Inc. Source: FDD Item 1, 2024 filing.
What is Item 19 in the Radisson 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 Radisson Hotels FDD and qualifies whose outlets they describe.
What is Radisson Hotels' franchise failure rate?
There is no published franchise failure rate, and Radisson Hotels has too few resolved SBA 7(a) loans on file (fewer than 10) to show an SBA charge-off rate that would mean anything. The SBA charge-off rate is the share of a brand's resolved SBA 7(a) loans to its franchisees that the SBA wrote off, including purchased guarantees. Resolved means paid in full or charged off; active loans are excluded because their outcome is not yet known. It is a lending outcome, not a count of closed businesses. Review the turnover and closure figures in Item 20 of the FDD and speak with current and former franchisees.
How many Radisson Hotels franchise locations are there?
Per the 2024 FDD, Radisson Hotels has 52 franchised units and 6 company-owned (58 in all). In the latest year, the number of franchised outlets fell by 5 (1 opened, 6 closed).
Is Radisson Hotels a good franchise to buy?
FranchiseVerdict gives Radisson Hotels a B Verdict grade (Second tier) with a verdict score of 50 out of 100 (higher is better), an editorial assessment, not investment advice. Helped by financial health (audited financials), scale and transparency. Held back by unit growth (-18 franchised outlets over the two years to 2023: 70 to 52, -25.7% in total, -13.8% a year compounded). The “Why a B” section on this page lists all six dimensions and any adjustment. Speak with current franchisees before making any investment decision.
Other Lodging franchises
Similar investment first, then by grade
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.