Candlewood Suites Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$14,169,501 - $21,400,950
Franchise Fee
$50,000
Min Cash Required
$78,750
Total US Locations
384
Business Summary
Candlewood Suites operates extended stay hotels designed for mid-market business and leisure travelers. Its hotels offer spacious suites with fully equipped kitchens, ample storage, large workspaces, and complimentary high-speed internet. Each location typically includes an outdoor Gazebo Grill, a Lending Locker for borrowing items, a 24-hour fitness center, and free guest laundry facilities. The Candlewood Cupboard provides snacks and essentials available 24 hours a day.
Corporate History
Holiday Hospitality Franchising, LLC was formed as a Delaware limited liability company on November 3, 1989, originally named Holiday Inns Franchising, Inc. The company's name changed multiple times before becoming its current limited liability company. Holiday began offering licenses for Candlewood Suites hotels in the United States in December 2003, although the ultimate predecessor of the Candlewood Suites brand started licensing in June 1995. The company's predecessors have a longer history, operating hotel businesses and offering licenses for various hotel brands starting in approximately 1953. Holiday's ultimate corporate parent is InterContinental Hotels Group PLC, with Six Continents Hotels, Inc. serving as its direct corporate parent.
Financial Overview
Investment Range
$14,169,501 - $21,400,950
Franchise Fee (Low)
$50,000
Franchise Fee (High)
$60,000
Minimum Cash Required
$78,750
Royalty %
5.5%
Marketing %
2.5%
Equipment Costs (Low)
$13,311,651
Equipment Costs (High)
$19,783,600
Working Capital
$91,875
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
Holiday Hospitality Franchising, LLC's financial health is closely intertwined with its parent company, Six Continents Hotels, Inc. The company operates under an agreement where its parent, Six Continents Hotels, Inc., covers all operating and administrative expenses and provides financial support. Holiday Hospitality Franchising, LLC maintains a substantial line of credit from an affiliate, totaling $770.6 million as of December 31, 2024. The auditors indicate that the credit risk associated with this line is low, based on the availability of funds within the broader corporate group and the parent's intention to ensure Holiday can meet its liabilities. No concerns regarding the company's ability to continue as a going concern were identified by the independent auditors. Overall, Holiday Hospitality Franchising, LLC appears to have a stable financial position, heavily supported by its larger corporate structure.
Financing Details
Holiday Hospitality Franchising, LLC does not offer any formal financing programs directly to franchisees. However, Holiday, its direct parent Six Continents Hotels, Inc. (SCH), or its affiliate General Innkeeping Acceptance Corporation (GIAC) may, in certain situations, provide loans or guaranties to licensees. Any such financing arrangements would be negotiated on a case-by-case basis, and the decision to offer a loan or guaranty rests solely with Holiday, SCH, or GIAC, contingent upon approval from their Executive Committee and Board of Directors. Franchisees are solely responsible for securing adequate financing for all aspects of developing, opening, and operating their Candlewood Suites hotel.
Performance Metrics
Total US Locations
384
Franchised Units
384
Corporate Units
0
Franchising Since
2003
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
43
Litigation Summary
Holiday Hospitality Franchising, LLC and its affiliate, Six Continents Hotels, Inc., have a comprehensive legal history with several pending and numerous concluded cases. Currently, there are 9 pending litigation matters. These include lawsuits from licensees alleging wrongful non-renewal, unreasonable standards, fraudulent misrepresentation, and improper vendor kickbacks. Holiday has also filed counterclaims and lawsuits against licensees for unpaid fees and liquidated damages due to early termination. In one significant ongoing case, a consolidated class action from 2021, licensees allege that Holiday engaged in unlawful business practices, imposed unreasonable product requirements, and received improper kickbacks from vendors. While a motion for summary judgment was granted in Holiday's favor, the plaintiffs filed an appeal in January 2025, and the case remains active. Additionally, Holiday recently filed three separate lawsuits in 2024 against licensees and guarantors for outstanding license fees and damages. In the past, Holiday and its affiliates have been involved in 34 concluded cases, covering a variety of disputes. These include settlements with licensees, judgments obtained by Holiday for unpaid fees, and resolutions of class actions related to data security breaches or alleged antitrust violations. Some notable concluded cases involved substantial payments by Holiday or its affiliates, such as $10.9 million in a breach of contract case and $175,000 in a Telephone Consumer Protection Act violation. Other cases were dismissed with no payment by Holiday or resulted in payments to Holiday from licensees.
Bankruptcy History
Holiday Hospitality Franchising, LLC has no bankruptcy history required to be disclosed in Item 4 of this Franchise Disclosure Document.
Agreement Terms
Initial Term
20 years
Training & Support Program
Franchisor Assistance
Holiday Hospitality Franchising, LLC provides extensive support to Candlewood Suites franchisees, both before and after their hotels open. Before opening, Holiday assists with construction plan approval, supplies prototype architectural plans (which franchisees must adapt with an approved architect), and reviews Property Improvement Plans (PIPs) for conversions. The franchisor also conducts inspections before the hotel opens to ensure compliance with standards. Franchisees and their teams attend a kick-off meeting for consultation on business and building plans, and they must participate in a pre-opening support program. For ongoing operations, Holiday maintains high brand standards for quality, cleanliness, and service, and promotes the Candlewood Suites name to increase demand. Franchisees receive access to reservation services, ongoing required and optional training programs, and consultation on operations, facilities, and marketing. Holiday manages a System Fund, which pools contributions for marketing, reservations, and loyalty programs across all IHG brands. Franchisees also get access to IHG Merlin, an online information library for operational resources and communications, and benefit from Holiday's management of brand websites and digital marketing efforts. Holiday's employees also provide annual on-site consulting visits to help with various operational aspects.
Initial Training Hours
253
Training Location
Atlanta, GA, or virtual, and other designated regional locations or at the franchisee's hotel
Ongoing Support
After a Candlewood Suites hotel opens, Holiday Hospitality Franchising, LLC provides continuous assistance and support. This includes ongoing required and optional training programs for staff, access to central reservation services, and consultation and advice on operations, facilities, and marketing. Holiday actively works to maintain high standards of quality, cleanliness, appearance, and service across all Brand System hotels to enhance the brand's public image and demand for its services. The franchisor also communicates improvements and developments within the Brand System, including updates to reservation services, marketing operations, and administrative and technical support functions. Holiday's employees conduct annual on-site consulting and training visits to each hotel, focusing on areas like reservations, revenue management, service management, and marketing programs. During these visits, the General Manager and department heads develop strategic action plans. Franchisees also have constant access to IHG Merlin, an internet-based information delivery service, which provides up-to-the-minute documentation, sales tools, and technology support. This platform serves as the primary means for Holiday to communicate brand standards, operational information, and other system requirements.
Franchise Requirements
Ideal Candidate Profile
Holiday Hospitality Franchising, LLC seeks individuals or entities with strong business skills, financial capacity, and good character to become Candlewood Suites franchisees. While Holiday does not require the franchisee to personally participate in the direct day-to-day operation of the hotel, the franchisee is required to retain and exercise direct management control over the business at all times, unless an alternative arrangement is approved by Holiday. This means a franchisee must either be actively involved in a supervisory capacity or hire a qualified management company or key personnel to run the hotel. If a management company is hired, Holiday will evaluate its experience in the extended-stay hospitality business. For key roles, such as General Manager and Director of Sales, individuals with at least two years of prior experience in a similar hotel brand segment are preferred, and they must work exclusively for the Candlewood Suites hotel.
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Min Years Experience
2
Operational Details
Location Type
retail
Owner Participation
absentee-allowed
Territory Type
non-exclusive
Territory Size Requirements
Candlewood Suites franchisees typically do not receive an exclusive territory. The license is granted for a specific hotel site only and applies to that location and no other. While Holiday Hospitality Franchising, LLC may, in special circumstances, grant exclusive or protected areas where another Candlewood Suites Hotel will not be licensed, such a license would still be for a specific site only and for one hotel.
Staffing Notes
Candlewood Suites franchisees are required to employ suitable and qualified individuals in sufficient numbers to staff all hotel positions according to the brand's Standards. The franchisee, or its appointed management company, is considered the sole employer and is responsible for all employment decisions, including policies, discipline, recruitment, and termination, without direct control from Holiday Hospitality Franchising, LLC. While Holiday does not impose specific restrictions on employees, confidentiality of proprietary information is required. The General Manager and other department heads, such as the Front Office Manager, Director of Sales, Executive Housekeeper, and Hotel Experience Champion, must attend mandatory training programs designated by Holiday. If a General Manager or Director of Sales is required, they typically need at least two years of prior experience in a similar hotel brand segment and must work exclusively for the Candlewood Suites hotel. Holiday may reject a proposed management company if it lacks experience in the extended-stay hospitality business.