TravelodgeFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Travelodge franchise requires a total initial investment of $219K – $10.9M, including a $35K franchise fee and an ongoing 5.0% royalty[2]. The 2024 FDD does not disclose unit-level revenue (no Item 19). SBA 7(a) loans show a 8.2% charge-off rate across 243 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2024 FDD issuance
Overview
- Investment
- $219K – $10.9M
- 13th pct Lodging
- Avg gross sales
- N/A
- 2nd pct Lodging
- Royalty
- 5.0%
- 4th pct Lodging
- Units
- 339
- 44th pct Lodging
- SBA default
- 8.2%
- system-wide median varies by category
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
Franchising since 1996. Systems this mature have refined operations and brand recognition.
Franchised units fell from 352 to 339 over 3 years. Investigate why operators are leaving.
14 legal cases disclosed in the FDD. Read Item 3 before signing.
Bottom line
- Total investment $219K – $10.9M including a $35K franchise fee, 5.0% ongoing royalty.
- Item 19 discloses "ADR, Occupancy Rate, and RevPAR" rather than annual gross sales, so unit revenue is not directly comparable.
- Verdict A (Top Quintile) with a risk score of 53/100. SBA loan charge-off rate of 8.2% across 243 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- 14 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
- Travelodge Hotels, Inc.
- Parent company
- Wyndham Hotels & Resorts, Inc.
- Incorporated in
- DE
- HQ
- 22 Sylvan Way, Parsippany, New Jersey 07054
- Auditor
- Deloitte & Touche LLP
- Audited financials
- Franchisor revenue
- $1.4B
- vs $1.5B prior year
Independent franchisee associations
- Franchise Advisory Council (FAC)
Franchisee-led councils or alliances disclosed in Item 20. Indicates operator voice.
Affiliated brands
- Wyndham Franchisor
- WSSI
Other brands the franchisor or its parent operates (Item 1).
Overview
About
Franchisees operate budget hotel properties under the Travelodge brand, managing daily operations including front desk, housekeeping, maintenance, and guest services. They generate revenue primarily through nightly room rates and ancillary services while paying 5% of gross room revenues as royalties, regardless of occupancy rates or profitability.
- CEO
- Geoff Ballotti
- Headquarters
- NJ
- Founded
- 1996
- FDD year
- 2024
- States available
- 43
FDD Item 7 · 2024 filing · 19 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Fee (inclusive of Application Fee) | $35K | $35K | |
| Photos | $2K | $6K | |
| Training Tuition | $5K | $7K | |
| Training Expenses | $3K | $4K | |
| Market Study | $5K | $12K | |
| Real Estate and Site Preparation | — | — | |
| Architecture, Design and Engineering, Phase I Environmental, Permits, Licenses, Deposits and Related Fees | $166K | $427K | |
| Facility Construction | $4.6M | $8.2M | |
| Construction Contingency | $231K | $410K | |
| Technology Systems | $68K | $70K | |
| Property Management Set-Up and Installation | $4K | $21K | |
| Furniture, Fixture and Equipment | $431K | $958K | |
| Signage | $20K | $80K | |
| Opening Inventory | $250K | $305K | |
| Insurance | $15K | $30K | |
| Grand Opening Advertising | $2K | $15K | |
| Pre-Opening Wages | $79K | $140K | |
| Miscellaneous Non-Tangible Asset Costs | $18K | $35K | |
| Additional Funds for 3 Month Initial Period | $116K | $177K | |
| Total initial investment | $6.1M | $10.9M |
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
- $219K – $10.9M
- Better than avg vs category
- Liquid capital req'd
- $116K – $177K
- Better than avg vs category
- Franchise fee
- $5K – $35K
- Better than avg vs category
- Royalty
- 5.0%
- Gross Room Revenues · typical 6–8%
- Ad fund
- 3.5%
- typical 3–5%
- Total fee load
- 8.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 5.0% of gross sales |
| Marketing / ad fund | 3.5% of gross sales |
| Transfer fee | $35K |
| Renewal fee | $35K |
| Inventory (initial) | $250K – $305K |
| Total fee load | 8.5% of rev |
Financial Performance
This brand's FDD disclosed "ADR, Occupancy Rate, and RevPAR" 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 Travelodge Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 339
- Opened
- 31
- Last reporting year
- Closed
- 32
- Turnover rate
- 9.4%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- -0.3%
- Net unit change last year
- 3-yr CAGR
- -3.7%
- Compounded over last 3 years
3-year detail · Item 20
- Closed (3yr)
- 31
- Terminated (3yr)
- 4
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 17
- Reacquired (3yr)
- 0
- Franchisor bought back
- Termination rate
- 1.2%
- Franchisor-initiated terminations
- Ceased ops
- 9.1%
- 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 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 243
- Loan volume
- $280.5M
- Median loan
- $1.0M
- 50th percentile
- Charge-off rate
- 8.2%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 91.8%
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 97
- Defaults
- 19
Vintage analysis
Travelodge charge-off rate by loan vintage
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Travelodge's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 27-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
Travelodge presents high risk due to system contraction, extensive litigation involving both consumers and franchisees, regulatory FTC involvement, and complete lack of unit-level financial disclosure that would demonstrate franchisee profitability.
Litigation (Item 3)
12 case reference(s): 1 pending, 0 settled.
Largest disclosed settlement: $403
Bankruptcy (Item 4)
None disclosed
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: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 53 / 100 rating
- 01MINORDeclining unit count (-0.3% YoY) indicates system contraction despite 20-year terms
- 02MINORMultiple class action lawsuits involving marketing fees and price fixing suggest franchisor practices under legal scrutiny
- 03MINORFTC/FFC regulatory actions on acquisitions raise corporate governance and antitrust concerns
- 04HIGHSignificant litigation with franchisees over non-payment and contract breaches indicates franchisor-franchisee relationship deterioration
- 05MEDNo disclosed average revenue or net income data (no Item 19) prevents assessment of unit-level profitability
- 06MINORWide investment range ($218K-$10.9M) suggests unclear unit economics or multiple hotel types with different viability
- 07MINOR5% royalty on gross room revenue is high-friction during low-occupancy periods
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 | Negotiated |
| Protected territory | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Right of first refusalℹ | No |
| Termination notice | 30 days |
| Termination groundsℹ | 3 |
| Curable defaultsℹ | 1 |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | New Jersey |
| Litigation count | 14 |
View Item 3 litigation summary
12 case reference(s): 1 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 34 hrs
- On-the-job training
- 30 hrs
- Training location
- Off-site and on-site
- Site selection
- franchisee
- Franchisor financing
- Offered
- Item 10
- POS system
- SynXis or OPERA
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: SynXis or OPERA
Item 20 · call current owners
Franchisee Contacts
102 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Travelodge · FDD (2024) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Travelodge franchise?
The total investment to open a Travelodge franchise ranges from $219K – $10.9M, with an initial franchise fee of $35K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Travelodge franchise owners earn?
Travelodge 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 Travelodge's franchise failure rate?
Based on SBA 7(a) loan data, Travelodge has a charge-off rate of 8.2% across 243 loans, meaning 8.2% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Travelodge franchise locations are there?
As of their most recent FDD filing, Travelodge has 339 total units in the United States, including 352 franchised units and 0 company-owned units. 31 new units were opened in the latest reporting year.
Is Travelodge a good franchise to buy?
FranchiseVerdict rates Travelodge as a A-grade franchise with a risk score of 53 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 Travelodge, 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.