Sonesta ES SuitesFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Sonesta ES Suites franchise requires a total initial investment of $982K – $26.4M, including a $65K franchise fee and an ongoing 5.0% royalty[2]. The 2026 FDD does not disclose unit-level revenue (no Item 19). Verdict grade: B. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $982K – $26.4M
- 25th pct Lodging
- Avg gross sales
- N/A
- 2nd pct Lodging
- Royalty
- 5.0%
- 4th pct Lodging
- Units
- 73
- 32nd 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
The system grew 136% year-over-year. Fast growth means demand, but can strain support.
23 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $982K – $26.4M including a $65K franchise fee, 5.0% ongoing royalty.
- Item 19 discloses "ADR, Occupancy, RevPAR, and Contribution" rather than annual gross sales, so unit revenue is not directly comparable.
- Verdict B (Above Average) with a risk score of 59/100.
- Bankruptcy history disclosed in the FDD. Review Item 4 for details before proceeding.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Sonesta RL Hotels Franchising Inc.
- Parent company
- Red Lion Hotels Corporation
- CEO title
- Co-President and Co-Chief Executive Officer
- Keith Pierce
- Incorporated in
- WA
- HQ
- 400 Centre Street, Newton, Massachusetts 02458
- Auditor
- Deloitte & Touche LLP
- Audited financials
- Franchisor revenue
- $58.5M
- vs $51.1M prior year
- Management churn noted
- Frequent turnover
- Item 2 disclosed frequent executive changes
Overview
About
Sonesta ES Suites franchisees operate extended-stay hotel properties (typically 120–300+ rooms) targeting business travelers and relocating families with weekly/monthly lease models. Day-to-day operations include housekeeping, front desk management, maintenance, revenue management, guest services, and compliance with Sonesta's brand standards across food service, cleanliness, and loyalty program integration.
- CEO
- Keith Pierce
- Headquarters
- MA
- Founded
- 1986
- FDD year
- 2026
- States available
- 23
FDD Item 7 · 2026 filing · 32 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Feenot refundable | $65K | $65K | |
| Onboarding Administration Feenot refundable | $5K | $5K | |
| Revenue Management System Installationnot refundable | $2K | $10K | |
| CRS to PMS Interface and Tokenization Set Up Feenot refundable | $650 | $4K | |
| IT Implementation Services Feenot refundable | $0 | $20K | |
| Property Management System Installation Fee | $9K | $15K | |
| Ancillary System Hardware, Network, Administration | $5K | $25K | |
| Sales Technology Platform Implementation Costsnot refundable | $2K | $2K | |
| PIP Feenot refundable | $5K | $5K | |
| PIP Reinspection Feenot refundable | $0 | $5K | |
| Custom Architecture & Design Reviewnot refundable | $5K | $25K | |
| Initial Brand Training Fee and Reimbursement of Expensesnot refundable | $2K | $4K | |
| Initial Training Expenses | $1K | $2K | |
| Real Estate, Legal and Title Expenses | — | — | |
| Construction and Improvement Costs | $104K | $15.9M | |
| Permits, Licenses, Plans, Etc. | $50K | $2.9M | |
| Furniture, Fixtures, and Equipment | $50K | $3.2M | |
| Operating Supplies and Equipment | $64K | $420K | |
| Contingencies | $50K | $2.2M | |
| Lender Comfort Letter Feenot refundable | $2K | $2K | |
| Total initial investment | $982K | $26.4M |
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
- $982K – $26.4M
- Better than avg vs category
- Liquid capital req'd
- $401K – $553K
- Better than avg vs category
- Franchise fee
- $65K
- Better than avg vs category
- Royalty
- 5.0%
- Gross Rooms Revenue · typical 6–8%
- Ad fund
- 3.5%
- typical 3–5%
- Total fee load
- 17.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 3.5% of gross sales |
| Technology fee | $9 |
| Training fee | $2K |
| Transfer fee | $65K |
| Renewal fee | $65K |
| Total fee load | 17.5% of rev |
Financial Performance
This brand's FDD disclosed "ADR, Occupancy, RevPAR, and Contribution" 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 Sonesta ES Suites Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 73
- Opened
- 40
- Last reporting year
- Closed
- 6
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 8.2%
- Company-owned
- 14
- Corporate units in the system
- % franchised
- 81%
- vs corporate-owned
- Multi-unit owners
- 5.0%
- Net growth (yr3)
- +136.0%
- Net unit change last year
- 3-yr CAGR
- +181.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 2
- Projected new
- 10
- Franchisor's next-year forecast
- Transfer rate
- 2.7%
- Owners selling to other franchisees
- Ceased ops
- 8.2%
- Units that stopped operating
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 24 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.
Fast growth in a small system. Newer franchisors expanding quickly may not yet have the support infrastructure of larger systems.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 12
- Loan volume
- $60.8M
- Median loan
- $5.0M
- 50th percentile
- 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
- 7
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Sonesta ES Suites's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 7 lenders with concentration factor
- Per-state charge-off rates across 5 states
- Startup risk premium and job creation velocity
- 3-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
Sonesta ES Suites presents material risk due to undisclosed profitability, active multi-front litigation, unprotected territories, and aggressive growth that may indicate market saturation rather than franchise strength.
Litigation (Item 3)
No litigation disclosed in Item 3
Bankruptcy (Item 4)
Disclosed in last 7 years
Office Properties Income Trust and certain subsidiaries filed voluntary Chapter 11 bankruptcy petition 25-90530 in United States Bankruptcy Court of Texas (Houston) on October 30, 2025. Principal place of business: Two Newton Place, 255 Washington Street, Suite 300, Newton, Massachusetts 02458-1634.
Audited financials (Item 21)
Yes · Deloitte & Touche 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: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 59 / 100 rating
- 01MINORNo average net income disclosure (Item 19) prevents ROI validation on $981k–$26.4M investment range
- 02HIGHMultiple active litigation streams (stockholder class-actions, competitor lawsuits, breach/collection suits) indicate operational and legal instability
- 03MINORUnprotected territory creates direct competition risk; 136% YoY unit growth suggests oversaturation potential
- 04MED5% royalty on gross rooms revenue (not profit) compounds cash flow pressure if occupancy declines
- 05MINOR72-unit base system with explosive 136% growth rate is unsustainable and suggests quality control/support strain
- 06HIGHPost-2021 Sonesta merger integration appears incomplete given ongoing stockholder litigation and unclear synergies
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 | 20 years |
| Allowed renewalsℹ | 1 |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Newton, Massachusetts |
| Jury trial waiver | Yes |
| Governing law | Massachusetts |
| Litigation count | 23 |
View Item 3 litigation summary
No litigation disclosed in Item 3
Items 10, 11
Training & Operations
- Classroom training
- 33 hrs
- On-the-job training
- 0 hrs
- Training location
- On-site and corporate
- Ongoing training
- Required
Items 5 & 11
Franchisor Support
Item 20 · call current owners
Franchisee Contacts
61 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Sonesta ES Suites · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Sonesta ES Suites franchise?
The total investment to open a Sonesta ES Suites franchise ranges from $982K – $26.4M, with an initial franchise fee of $65K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Sonesta ES Suites franchise owners earn?
Sonesta ES Suites 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 Sonesta ES Suites's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Sonesta ES Suites (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 Sonesta ES Suites franchise locations are there?
As of their most recent FDD filing, Sonesta ES Suites has 73 total units in the United States, including 21 franchised units and 14 company-owned units. 40 new units were opened in the latest reporting year.
Is Sonesta ES Suites a good franchise to buy?
FranchiseVerdict rates Sonesta ES Suites as a B-grade franchise with a risk score of 59 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.