Radisson REDFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Radisson RED franchise requires a total initial investment of $7.1M – $41.8M, including a $75K franchise fee and an ongoing 5.0% royalty[2]. The 2022 FDD does not disclose unit-level revenue (no Item 19). Verdict grade: F. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2022 FDD issuance
Overview
- Investment
- $7.1M – $41.8M
- 34th pct Lodging
- Avg gross sales
- N/A
- 2nd pct Lodging
- Royalty
- 5.0%
- 4th pct Lodging
- Units
- 2
- 10th pct Lodging
- SBA default
- N/A
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
Bottom line
- Total investment $7.1M – $41.8M including a $75K franchise fee, 5.0% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict F (Bottom Quintile) with a risk score of 100/100.
- No 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
- Legal entity
- Radisson Hotels International, Inc.
- Parent company
- Radisson Hospitality, Inc.
- Incorporated in
- DE
- HQ
- 1601 Utica Avenue South, Suite 700, St. Louis Park, Minnesota 55416
- Auditor
- PricewaterhouseCoopers LLP
- Audited financials
- Franchisor revenue
- $198.3M
- vs $221.6M prior year
Overview
About
Franchisees operate upscale, design-focused hotel properties under the Radisson RED brand, managing daily operations including guest services, housekeeping, food & beverage, and revenue management. They pay 5% of total room revenue in royalties plus undisclosed marketing fees to support brand marketing, reservations systems, and corporate services across a 20-year term.
- CEO
- M. Thomas Buoy
- Headquarters
- MN
- Founded
- 1983
- FDD year
- 2022
- States available
- 2
FDD Item 7 · 2022 filing · 20 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial License Feenot refundable | $75K | $75K | |
| Product Improvement Plannot refundable | $0 | $3K | |
| Construction Commencement Date, Renovation Commencement Date or Opening Date Extension Feenot refundable | $0 | $2K | |
| Real Estate | — | — | |
| Improvementsnot refundable | $3.5M | $30.0M | |
| Design & Engineering Costsnot refundable | $500K | $1.0M | |
| Furniture, Fixtures & Equipmentnot refundable | $675K | $6.0M | |
| Interior Design Review Feenot refundable | $0 | $3K | |
| Architectural Plan Review Feenot refundable | $0 | $3K | |
| Technical Services Feenot refundable | $0 | $2K | |
| Exterior Signagenot refundable | $50K | $200K | |
| Miscellaneous Pre-Opening Costsnot refundable | $500K | $1.0M | |
| Opening Inventorynot refundable | $200K | $1.2M | |
| ORACLE Opera Cloud PMS Initial Investmentnot refundable | $31K | $31K | |
| Training Registration Fees and Expensesnot refundable | $5K | $10K | |
| WebExtraSM Feenot refundable | $150 | $1K | |
| Start-Up Suppliesnot refundable | $10K | $12K | |
| SalesForce Community Feesnot refundable | $440 | $440 | |
| IDeaS Feesnot refundable | $4K | $4K | |
| Additional Funds 3 Monthsnot refundable | $1.5M | $2.0M | |
| Total initial investment | $7.1M | $41.5M |
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
- $7.1M – $41.8M
- Better than avg vs category
- Liquid capital req'd
- $1.5M – $2.0M
- Near category avg vs category
- Franchise fee
- $75K
- Better than avg vs category
- Royalty
- 5.0%
- 5% of Total Rooms Revenue · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 7.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Training fee | $10K |
| Transfer fee | $75K |
| Total fee load | 7.0% of rev |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
vs Lodging averages
How Radisson RED Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 2
- Opened
- 1
- Last reporting year
- Closed
- 1
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 50.0%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 50%
- vs corporate-owned
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 0
- Franchisor's next-year forecast
- Ceased ops
- 50.0%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 11 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 loan disclosures. This brand has only 7 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 7
- Loan volume
- N/A
- Amount data pending
- Median loan
- N/A
- Charge-off rate
- N/A
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
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Radisson RED presents extreme risk: a collapsing franchise system (2 units) with existential solvency concerns, active multi-front litigation, and zero financial transparency.
Litigation (Item 3)
Two pending cases: (1) Radisson Hotels International, Inc. v. AIL Hospitality, LLC - breach of license agreement and personal guaranty, seeking $249,746.71; counterclaim alleging breach and unjust enrichment seeking over $500,000. (2) Norma Knuth v. Radisson Hotels International, Inc. - class action regarding undisclosed destination marketing fees charged to Canadian hotel guests.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · PricewaterhouseCoopers LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 100 / 100 rating
- 01MINOROnly 2 units in entire system with unknown growth trajectory indicates severe contraction or failed concept
- 02HIGHActive litigation across multiple categories (breach, class action, fee disputes) suggests systemic franchisor-franchisee conflict
- 03HIGHGoing Concern = False explicitly states the franchisor may not survive as ongoing business
- 04MEDNo disclosed average revenue or net income prevents ROI validation on $7-41M investment range
- 05MED5% royalty on room revenue with undisclosed destination marketing fees creates hidden cost structure
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 |
|---|---|
| Allowed renewalsℹ | 0 |
| Territory type | Radius |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Online sales rights | Granted |
| 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 | Minnesota |
| Litigation count | 6 |
View Item 3 litigation summary
Two pending cases: (1) Radisson Hotels International, Inc. v. AIL Hospitality, LLC - breach of license agreement and personal guaranty, seeking $249,746.71; counterclaim alleging breach and unjust enrichment seeking over $500,000. (2) Norma Knuth v. Radisson Hotels International, Inc. - class action regarding undisclosed destination marketing fees charged to Canadian hotel guests.
Items 10, 11
Training & Operations
- Classroom training
- 48 hrs
- On-the-job training
- 0 hrs
- Training location
- On-site and corporate
- POS system
- ORACLE Opera Cloud PMS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: ORACLE Opera Cloud PMS
Item 20 · call current owners
Franchisee Contacts
14 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Radisson RED · FDD (2022) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Radisson RED franchise?
The total investment to open a Radisson RED franchise ranges from $7.1M – $41.8M, with an initial franchise fee of $75K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Radisson RED franchise owners earn?
Radisson RED 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 Radisson RED's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Radisson RED (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 Radisson RED franchise locations are there?
As of their most recent FDD filing, Radisson RED has 2 total units in the United States, including 1 franchised units and 1 company-owned units. 1 new units were opened in the latest reporting year.
Is Radisson RED a good franchise to buy?
FranchiseVerdict rates Radisson RED as a F-grade franchise with a risk score of 100 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.
For franchisors
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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.