Sonesta Select / Sonesta Essential Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Sonesta Select and Sonesta Essential are select-service hotel franchise brands for the midscale and upper-midscale segments. Franchisees own and operate the properties, managing guest services, housekeeping, and revenue under Sonesta standards.
FranchiseVerdict summary · 2026
A Sonesta Select / Sonesta Essential franchise requires a total initial investment of $957K – $18.6M, including a $45K – $65K franchise fee and an ongoing 5.0% royalty[2]. The 2024 FDD does not disclose unit-level revenue (no Item 19). FranchiseVerdict grade: B (Above average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2024 FDD issuance
Overview
- Investment
- $957K – $18.6M
- 25th pct Lodging
- Avg gross sales
- N/A
- 1st pct Lodging
- Royalty
- 5.0%
- 4th pct Lodging
- Units
- 61
- 30th pct Lodging
- SBA charge-off
- N/A
Quick verdict · Lodging · color = vs category peers
Green = favorable by >10% vs Lodging avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- Total investment $957K – $18.6M including a $45K franchise fee, 5.0% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict B (Above average), verdict score 54/100 (higher is better).
- 19 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
Corporate structure & franchisor financials
- Legal entity
- Sonesta RL Hotels Franchising Inc.
- Parent company
- Red Lion Hotels Corporation (RLHC)
- Ultimate parent
- Sonesta Holdco Corporation
- Predecessor
- companies
- Prior franchisor entity
- CEO title
- President and Director
- John Murray
- Incorporated in
- Washington
- HQ
- 400 Centre Street, Newton, Massachusetts 02458
- Auditor
- Deloitte & Touche LLP
- Audited financials
- Franchisor revenue
- $56K
- vs $54K prior year
Overview
About
- CEO
- John Murray
- Headquarters
- MA
- Founded
- 1986
- FDD year
- 2024
- States available
- 12
Can you afford it, and what does the money buy?
Entry cost is about average for a lodging franchise.
Source: FDD 2024 · Items 5–7
FDD Item 7 · 2024 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $45K | $45K |
| Working capital (3–6 mo) | $300K | $600K |
| Equipment, build-out, other | $612K | $17.9M |
| Total initial investment | $957K | $18.6M |
Source: Sonesta Select / Sonesta Essential 2024 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $957K – $18.6M
- Top 40% of category vs category
- Liquid capital req'd
- $300K – $600K
- Top 40% of category vs category
- Franchise fee
- $45K – $65K
- Top 40% of category 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 |
| Transfer fee | $45K |
| Renewal fee | $45K |
| Total fee load | 17.5% of rev |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Fee burden
Total ongoing fee load of 17.5% — above the Lodging average of 10.3%.
Disclosure
Franchisor chose not to disclose financial performance representations. You will need to gather unit economics directly from existing franchisees.
Operator retention
Net unit growth of +14.3% over 3 years (16 opened, 1 closed).
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Lodging averages
How Sonesta Select / Sonesta Essential Compares
Is the system healthy?
Source: FDD 2024 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 61
- Opened
- 16
- 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
- 6.3%
- Company-owned
- 45
- Corporate units in the system
- % franchised
- 26%
- vs corporate-owned
- Net growth (3-yr)
- +14.3%
- Net unit change over 3 years
3-year detail · Item 20
- Opened (3yr)
- 16
- Closed (3yr)
- 1
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 4
- Reacquired (3yr)
- 0
- Franchisor bought back
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 22 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.
Available to sell in · Item 12
- Michigan
- Wisconsin
States where the franchisor is registered to sell new franchises (FDD registration filings).
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 9 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 9
- Loan volume
- $43.6M
- Median loan
- $4.8M
- average
- Charge-off rate
- N/A
- limited sample (9 loans) — rate not shown below 10
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
- 3
- Defaults
- N/A
Explore lender portfolios on Bank Reports or regional data on State Reports.
What could kill this investment?
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
56-unit lodging system with 19 litigation matters (1 pending shareholder class action, mostly concluded merger/franchisor-plaintiff suits). Financials are parent-level ($81.1M net worth, +$1.48M net income) so the brand's own equity is not disclosed. No Item 19 and no bankruptcy disclosed.
Litigation (Item 3)
0 case reference(s): 0 pending, 0 settled.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Deloitte & Touche LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
ⓘ 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
- Franchisor sells you products: No
- Must buy proprietary products: No
Score breakdown · what drove the 54 / 100 verdict
- 01HIGHlitigation_count=19 (mostly concluded)
- 02MINORfinancials_are_parent_level=true
- 03MINORno Item 19 disclosure
- 04MINORparent net income positive +$1,477,000
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 17.5% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2024 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 20 years |
|---|---|
| Renewal term | 20 years |
| Allowed renewalsℹ | 1 |
| Protected territory | No |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Massachusetts |
| Litigation count | 19 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 0 hrs
- On-the-job training
- 31 hrs
- Training location
- On-site and franchisor location
- Franchisor financing
- Offered
- Item 10
- POS system
- Oracle OPERA Cloud
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Oracle OPERA Cloud
Item 20 · call current owners
Franchisee Contacts
36 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Sonesta Select / Sonesta Essential · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Sonesta Select / Sonesta Essential franchise?
The total investment to open a Sonesta Select / Sonesta Essential franchise ranges from $957K – $18.6M, with an initial franchise fee of $45K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Sonesta Select / Sonesta Essential franchise owners earn?
Sonesta Select / Sonesta Essential 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 Select / Sonesta Essential's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Sonesta Select / Sonesta Essential (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 Select / Sonesta Essential franchise locations are there?
As of their most recent FDD filing, Sonesta Select / Sonesta Essential has 61 total units in the United States, including 16 franchised units and 45 company-owned units. 16 new units were opened in the latest reporting year.
Is Sonesta Select / Sonesta Essential a good franchise to buy?
FranchiseVerdict rates Sonesta Select / Sonesta Essential as a B-grade franchise with a verdict score of 54 out of 100 (higher is better), 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
Are you the franchisor?
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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.