City Express by Marriott Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$2,738,400 - $4,867,900
Franchise Fee
$75,000
Total US Locations
1
Business Summary
City Express by Marriott operates mid-scale hotels designed to offer budget-friendly accommodations to the general public. Most locations are expected to be existing hotels converting to the City Express by Marriott brand or commercial buildings repurposed into hotels. These hotels provide amenities such as complimentary breakfast, a market or pantry, and a fitness center. All franchised City Express by Marriott hotels in the United States and Canada operate as part of a single system.
Corporate History
MIF, L.L.C., the franchisor for City Express by Marriott, was established in 2012 as a limited liability company under the laws of Delaware, operating as a subsidiary of Marriott International, Inc. The City Express brand itself has a longer history, having been originally established in Mexico in 2002 by Promotora de Hoteles Norte 19 SAB de CV (f/k/a Hoteles City Express, S.A.B. de C.V. or HCity). Marriott International, Inc. acquired the City Express brand, along with its existing hotel operating system and 152 hotels in Mexico and other Latin American countries, in May 2023. Following this acquisition, these pre-existing hotels transitioned to operating under the City Express by Marriott Brands through franchise agreements with Marriott affiliates. The City Express by Marriott brand was officially launched in the United States and Canada in July 2024, with its principal trademark designated in October 2024.
Financial Overview
Investment Range
$2,738,400 - $4,867,900
Franchise Fee (Low)
$75,000
Franchise Fee (High)
$100,000
Royalty %
5%
Marketing %
1.5%
Equipment Costs (Low)
$1,842,000
Equipment Costs (High)
$3,476,800
Working Capital
$400,000
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
MIF, L.L.C. operates as a subsidiary of Marriott International, Inc., its sole member, and does not retain cash balances, with all transactions handled through related party accounts with its parent company. The company recorded net income of $63,830,000 for 2024, $64,157,000 for 2023, and $53,570,000 for 2022. It has significant amounts due from related parties, totaling $443,571,000 in 2024 and $376,990,000 in 2023, on which it earned substantial interest income. The company has no accruals related to legal contingencies or impairment charges. MIF, L.L.C. is an LLC, so its income and losses flow through to its parent, and no provision for federal and state income taxes is made in its financial statements. Its allowance for credit losses on receivables was $1,466,000 in 2024. Overall, the financial statements indicate a stable entity operating within the larger Marriott International corporate structure.
Financing Details
City Express by Marriott generally does not offer direct or indirect financing for its franchised hotels or guarantee loans. However, in very limited situations and at its sole discretion, Marriott International Capital Corporation (MICC) may offer credit support, such as a contingent guarantee for a portion of a third-party loan, or provide a mezzanine loan. Decisions to offer such support depend on various factors, including market opportunities, hotel characteristics, economic conditions, and the franchisee's commitment to system growth. If credit support is provided, the specific terms, loan amounts, interest rates, repayment obligations, and other conditions would vary. Franchisees would be required to sign related documents, such as a Reimbursement Agreement and an Equity Pledge, and may be charged a guaranty fee. Marriott reserves the right to decline any such financing.
Performance Metrics
Total US Locations
1
Franchised Units
1
Corporate Units
0
Avg Square Footage
33,000
Franchising Since
2024
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
19
Litigation Summary
City Express by Marriott has been involved in several litigation and administrative matters. Significant ongoing litigation stems from a data security incident in November 2018, which led to multiple class action lawsuits consolidated into an MDL (Multi-District Litigation) in Maryland. An appeal regarding class certification was heard in November 2024. A separate lawsuit from the City of Chicago, also related to this incident, is ongoing with a trial set for November 2025. Various administrative investigations by regulatory authorities in the U.S., the UK, Turkey, Canada, and Australia followed this incident, with many resulting in resolutions, penalties, or ongoing compliance commitments as of 2023-2024. Sixteen class action lawsuits in Canada related to the 2018 data security incident were consolidated and are active. Marriott has also faced industry-wide investigations and lawsuits concerning the display of resort fees; a lawsuit by the District of Columbia is ongoing with a trial set for November 2025. Additionally, City Express by Marriott initiated arbitrations against franchisees in 2023 and 2024 for unpaid fees and breach of agreement, which were settled or resulted in awards in its favor. Two putative class action lawsuits filed in early 2024 allege unlawful sharing of information and price-fixing against Marriott and other hotel companies, with motions to dismiss currently pending. A civil suit filed in North Carolina in January 2022 resulted in a $16 million jury verdict against Marriott and a franchisee in October 2024, which Marriott is appealing. Concluded actions include a class action related to a March 2020 property system incident, which was settled and dismissed in 2021, and several individual class actions related to resort fees that were settled prior to 2024.
Bankruptcy History
City Express by Marriott has no bankruptcy history to disclose in this Franchise Disclosure Document.
Agreement Terms
Initial Term
20 years
Renewal Conditions
City Express by Marriott franchisees do not have a right to renew their franchise agreement, and should not expect to operate under the brand after the initial term expires. However, in its sole discretion, City Express by Marriott may choose to offer a new franchise agreement upon expiration of the term. This new agreement would be on the then-current form and could include materially different terms and conditions, including franchise fees and duration.
Training & Support Program
Franchisor Assistance
City Express by Marriott provides extensive support to its franchisees both before and after opening. Before a hotel opens, City Express by Marriott provides design and construction criteria, helps review plans, ensures compliance with brand standards, assists with purchasing initial furniture, fixtures, and equipment, and conducts site visits. It also trains the general manager and hotel management team, and provides access to operational manuals and procedures. After opening, City Express by Marriott offers ongoing consultation on hotel design and operations. It provides a comprehensive suite of electronic systems, including reservation, property management, and yield management systems, along with a secure Marriott Communications Network and Wi-Fi standards. The brand also runs a Marketing Fund (funded by a 1.5% contribution of gross room sales) for advertising, sales, and promotions, including loyalty programs and digital marketing. Franchisees must participate in the Marriott Bonvoy loyalty program and the Global Sales Organization, with options to join other sales programs for a fee. City Express by Marriott requires various mandatory training programs for staff and management, covering areas like brand standards, electronic systems, ethics, alcohol awareness, and food safety, some of which are included in the bundled fee, while others, like third-party certifications and a general manager conference, incur additional costs. There are also optional leadership development programs and specialized "onboarding" training for new Marriott franchisees.
Initial Training Hours
96
Training Location
Remotely, web-based, or at a location designated by City Express by Marriott
Ongoing Support
City Express by Marriott provides ongoing support to its franchisees through various channels. This includes making representatives available for consultation on hotel design and operation, and providing access to and support for essential electronic systems like the reservation, property management, and yield management systems. The franchisor continuously manages and directs the Marketing Fund activities for advertising, sales, and promotions, and oversees the Marriott Bonvoy loyalty program, in which franchisees must participate. City Express by Marriott also requires participation in its Global Sales Organization and offers optional participation in other sales teams. Franchisees receive updated operational standards, which they must comply with, and their plans for hotel upgrades and remodeling are reviewed. Ongoing training programs are offered for management personnel, and comprehensive computer systems are maintained, with mandatory updates, upgrades, and security services.
Franchise Requirements
Ideal Candidate Profile
City Express by Marriott seeks franchisees with managerial and operational experience, skills, capacity, capabilities, and a business philosophy that aligns with operating a hotel according to brand standards. Ideal candidates are those who are familiar with operating hotels, potentially with experience in converting existing hotels or repurposing commercial buildings. Candidates must meet financial qualifications and pass background checks, ensuring they have not been convicted of serious crimes, are not competitors, and have not been involved in significant litigation with Marriott. If a franchisee is new to Marriott or determined not to be qualified, they may be required to participate in an onboarding program (FOND) and additional support services, or even hire an approved third-party management company.
Industry Experience Required
Yes
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Commercial
Owner Participation
Supervisory
Territory Type
Non-Exclusive
Territory Size Requirements
City Express by Marriott franchisees will not receive an exclusive territory, and the franchisor may not even grant a territory. If a territory is granted, it will be non-exclusive, apply only to City Express by Marriott hotels, and typically last three years or less. The specific size or geographic boundaries of any granted territory will depend on the market where the hotel is located. It may be defined as a radius around the hotel or delineated by streets, highways, or other geographical boundaries, but no specific size or population metrics are generally provided as a universal requirement for all City Express by Marriott franchises. The continuation of these territorial rights is contingent on factors such as the timely start of construction and opening of the hotel, not on sales volume or market penetration. The franchisor and its affiliates retain the right to develop, own, operate, or franchise other lodging products or concepts, including other City Express by Marriott hotels, in any location, even near the franchisee's hotel.
Staffing Notes
City Express by Marriott franchisees are responsible for hiring qualified staff sufficient to operate the hotel, with all employment decisions made by the franchisee or their approved management company. Key positions include a general manager and sales directors/managers, who must be retained several months before opening and are required to dedicate full-time to the hotel's management and operation. All staff must complete mandatory training programs provided by City Express by Marriott or third-party vendors, covering areas like brand standards, electronic systems, ethics, alcohol awareness, and food safety. Additionally, any staff regularly in contact with guests in enclosed spaces must be provided with associate alert devices that have geolocation capabilities for emergencies. City Express by Marriott does not direct or control the hotel's employment policies but sets standards for staffing levels and qualifications.