Sonesta Simply SuitesFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Sonesta Simply Suites franchise requires a total initial investment of $14.0M – $19.2M, including a $50K franchise fee and an ongoing 5.0% royalty[2]. Per the 2026 FDD, average unit revenue was $2.1M[2]. Verdict grade: B. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $14.0M – $19.2M
- 45th pct Lodging
- Avg gross sales
- $2.1M
- 1st pct Lodging
- Royalty
- 5.0%
- 4th pct Lodging
- Units
- 67
- 30th 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
At 0.1x revenue per dollar invested, this system underperforms the typical 1.5-2.5x range.
Franchised units fell from 57 to 14 over 3 years. Investigate why operators are leaving.
22 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $14.0M – $19.2M including a $50K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $2.1M/year (median $1.9M).
- Verdict B (Above Average) with a risk score of 59/100.
- 22 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
- Legal entity
- Sonesta RL Hotels Franchising Inc.
- Parent company
- Red Lion Hotels Corporation (RLHC)
- Predecessor
- companies
- Prior franchisor entity
- 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
Overview
About
Franchisees develop and operate select-service extended-stay hotel properties under the Sonesta Simply Suites brand. Day-to-day operations include managing housekeeping, front desk, maintenance, and revenue optimization across a typically 100+ room inventory while adhering to brand standards. Franchisees retain responsibility for property-level P&L, staffing, and guest satisfaction, with revenue concentrated in nightly room rates (subject to the 5% royalty).
- CEO
- Keith Pierce
- Headquarters
- MA
- Founded
- 1986
- FDD year
- 2026
- States available
- 23
FDD Item 7 · 2026 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $50K | $50K |
| Working capital (3–6 mo) | $301K | $453K |
| Equipment, build-out, other | $13.7M | $18.7M |
| Total initial investment | $14.0M | $19.2M |
Source: Sonesta Simply Suites 2026 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$245K
11.5% margin
Unlevered ROIC
1%
EBITDA / total invested capital
Payback
69.3 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $14.0M – $19.2M
- Near category avg vs category
- Liquid capital req'd
- $301K – $453K
- Better than avg vs category
- Franchise fee
- $50K – $50K
- 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 |
| Transfer fee | $50K |
| Renewal fee | $50K |
| Total fee load | 17.5% of rev |
At 17.5% total fee load, roughly $373K per year goes to the franchisor before you pay a single operating expense.
Financial Performance
- Avg gross sales
- $2.1M
- Per unit, per year
- Median gross sales
- $1.9M
- Item 19 type
- RevPAR, ADR, Occupancy, and Contribution
- Sample size
- 62 units
- vs category median 100
- Range (low → high)
- $564K→$5.9M
- Cohort dispersion (min → max)
- Transparency tier
- limited
- Categorical assessment of disclosure depth
- Transparency
- 4 / 5
- vs category median 0 / 5 · above
Compared against 245 Lodging brands
Revenue is only 0.1x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
vs Lodging averages
How Sonesta Simply Suites Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 67
- Opened
- 42
- Last reporting year
- Closed
- 2
- Turnover rate
- 3.0%
- Company-owned
- 10
- Corporate units in the system
- % franchised
- 85%
- vs corporate-owned
- Net growth (yr3)
- Outlier (see FDD)
- Likely small-sample artifact
- 3-yr CAGR
- Outlier (see FDD)
- Likely small-sample artifact
3-year detail · Item 20
- Transfers (3yr)
- 0
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 15 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).
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 loan disclosures. This brand has only 3 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 3
- Loan volume
- $15.0M
- 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
- 2
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Sonesta Simply Suites's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 2 lenders with concentration factor
- Per-state charge-off rates across 2 states
- Startup risk premium and job creation velocity
- 2-year lending trend
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Sonesta Simply Suites presents elevated risk: undisclosed unit economics, explosive unit growth masking potential retention issues, substantial litigation history, and lack of territorial protection in a capital-intensive hospitality franchise with no going concern statement.
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)
Score breakdown · what drove the 59 / 100 rating
- 01MEDNo Item 19 (Average Unit Volume) disclosed — cannot validate $2.13M average revenue claim or profitability
- 02MINORAggressive unit growth (235% YoY) suggests recruitment over retention; sustainability unclear
- 03MED22 disclosed lawsuits including tortious interference with Radisson and 14 breach/collection cases against franchisees — indicates systemic franchisor-franchisee conflict
- 04MEDHigh initial investment ($14M–$19.2M) paired with 5% royalty on gross rooms revenue leaves limited margin for error
- 05MINORNo protected territory in hospitality market creates direct competition risk between franchisees
- 06HIGH20-year term locks capital long-term with no going concern assurances from parent company
- 07MINOR235% YoY unit growth is unsustainable and may reflect franchise recruitment bubble rather than organic success
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 |
| 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 | 22 |
View Item 3 litigation summary
0 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 33 hrs
- On-the-job training
- 0 hrs
- Training location
- On-site and corporate
- Franchisor financing
- Offered
- Item 10
- POS system
- Shift4
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Shift4
Item 20 · call current owners
Franchisee Contacts
25 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Sonesta Simply Suites · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Sonesta Simply Suites franchise?
The total investment to open a Sonesta Simply Suites franchise ranges from $14.0M – $19.2M, with an initial franchise fee of $50K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Sonesta Simply Suites franchise owners earn?
According to Item 19 of the Sonesta Simply Suites FDD, the average gross sales per unit is $2.1M. The median is $1.9M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Sonesta Simply Suites's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Sonesta Simply 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 Simply Suites franchise locations are there?
As of their most recent FDD filing, Sonesta Simply Suites has 67 total units in the United States, including 57 franchised units and 10 company-owned units. 42 new units were opened in the latest reporting year.
Is Sonesta Simply Suites a good franchise to buy?
FranchiseVerdict rates Sonesta Simply 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.
For franchisors
Are you the franchisor?
If you represent Sonesta Simply Suites, you can request corrections or provide updated information.
Claim this brandOther Lodging franchises
Compare similar franchise opportunities in the Lodging category
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.