Everhome Suites Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$12,317,550 - $17,138,050
Franchise Fee
$25,000
Min Cash Required
$200,000
Total US Locations
6,146
Business Summary
Everhome Suites operates mid-scale extended stay hotels offering studio and one-bedroom suites. Each suite includes a fully equipped kitchen with a full-sized refrigerator, dishwasher, stovetop, and microwave, along with provided dishes, utensils, and cookware. Guests can also rent small appliances at the front desk. The brand focuses on providing a distinctive hotel experience with its own trade name, system, and business practices for its hotel facilities.
Corporate History
Choice Hotels International, Inc.'s business began in 1939 when seven independent motel owners in Florida collaborated to meet customer needs. This group formalized their relationship in 1941, creating Quality Courts United, which became the nation's first hotel chain. In January 1963, the organization became a for-profit corporation, Quality Courts Motels, Inc., and expanded its services to include a training school, central reservations, and a hotel directory. The corporate name changed to Choice Hotels International, Inc. in 1990, and then briefly to Choice Hotels Franchising, Inc. in 1996-1997, before reverting to Choice Hotels International, Inc. in 1997. Choice Hotels International, Inc. has been franchising various hotel brands since at least 1968, with international operations starting around 1958. The Everhome Suites brand itself began offering franchises in November 2019. In 2022, Choice Hotels International, Inc. acquired Radisson Hospitality, LLC, expanding its brand portfolio to include several Radisson brands.
Financial Overview
Investment Range
$12,317,550 - $17,138,050
Franchise Fee (Low)
$25,000
Franchise Fee (High)
$50,000
Minimum Cash Required
$200,000
Royalty %
8%
Marketing %
1%
Equipment Costs (Low)
$11,517,800
Equipment Costs (High)
$15,410,800
Working Capital
$310,000
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
Choice Hotels International, Inc. has received an unqualified opinion on its consolidated financial statements for the years ended December 31, 2024, 2023, and 2022, indicating that the financial statements present fairly the company's financial position and results of operations in conformity with U.S. generally accepted accounting principles. A critical audit matter highlighted by the auditor is the accounting for the Choice Privileges Loyalty Program, due to the complexity of models and data volume, and the challenge of estimating future redemption rates. The company's financial agreements also allow it to advance monies to the franchise system when needed and recover these advances in the future through fee assessments or reduced spending. Choice Hotels International, Inc. maintains a significant debt load, with total debt reaching $1.7 billion in 2024, including $600 million in senior unsecured notes due in 2034. However, the company's investments in affiliates are generally limited in exposure to losses.
Financing Details
Choice Hotels International, Inc. offers several direct financing options to Everhome Suites franchisees. The affiliation fee can be financed, without interest, in a single lump sum payment generally due within three months after signing a promissory note. If the payment is late, an 18% annual default interest rate applies. Additionally, Choice Hotels International, Inc. may provide select capital support in certain strategic instances, evidenced by a 10- or 20-year forgivable promissory note. This capital support is forgiven over the term if no defaults occur, with interest (prime plus 2%) only accruing upon default. An incentive program for underrepresented entrepreneurs and veterans offers $3,000 per room (up to a maximum of $300,000) via a 10-year forgivable promissory note, or a 5-year note for 50% of the amount (up to $150,000) with a default interest rate of prime plus 7%. Personal guarantees may be required for these notes, and selecting these incentives may require waiving certain mutual termination rights in the franchise agreement. A re-licensing incentive provides a 50% discount on the affiliation fee for qualifying franchisees purchasing existing Choice-branded hotels. Choice Hotels International, Inc. also has non-exclusive qualified vendor agreements with third-party lenders (PMC Commercial Trust, Balboa Capital Corporation, Ascentium Capital LLC) who offer conventional and lease financing to franchisees, but these are not direct financing from Choice Hotels International, Inc. itself.
Performance Metrics
Total US Locations
6,146
Franchised Units
6,125
Corporate Units
21
Franchising Since
1968
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
90
Litigation Summary
Choice Hotels International, Inc. has several active and recently resolved litigation and arbitration cases. Pending cases include a class action lawsuit in Canada (Norma Knuth v. Radisson Hotels International, Inc., et al.) regarding undisclosed destination marketing fees, a suit (Jai Sai Baba, LLC, et al. v. Choice Hotels International, Inc., et al.) alleging discriminatory and anti-competitive practices, breach of contract, fraud, and RICO violations, a federal district court action (T&T Management, Inc. v. Choice Hotels International, Inc., Country Inn & Suites by Radisson, Inc. and Sunshine Fund Port Orange, LLC) for alleged breach of contract and misuse of guest data, and another federal case (CS Anaheim Hotel Investments, LLC v. Choice Hotels International, Inc.) alleging a fraudulent rebate scheme, misuse of system fees, misrepresentation, and breach of contract. Additionally, Choice Hotels International, Inc. initiated 82 actions in 2024 to recover royalties, liquidated damages, and other debts from franchisees. Recently resolved cases include a settlement for $85,000 to a former franchisee (Sender Kohl v. Choice Hotels International, Inc.), a final judgment against Choice Hotels International, Inc. for $779,398.40 in favor of a franchisee for breach of contract (Highmark Lodging, LLC, et al. v. Choice Hotels International, Inc., et al.), a judgment in favor of Choice Hotels International, Inc. against a franchisee for $603,483.00 in attorney's fees (Dahya Investments Incorporated, et al. v. Choice Hotels International, Inc., et al.), and an arbitration award where Choice Hotels International, Inc. recovered $256,051.37 in unpaid fees, but the franchisee prevailed on a wrongful termination claim for $4,411,678.56 (Choice Hotels International, Inc. v. DIP Hospitality, LLC, et al.).
Bankruptcy History
Choice Hotels International, Inc. has no bankruptcy history to report.
Agreement Terms
Initial Term
20 years
Renewal Conditions
Everhome Suites franchisees do not have a right or option to renew or extend their franchise agreement after the initial 20-year term expires.
Training & Support Program
Franchisor Assistance
Choice Hotels International, Inc. provides extensive support to Everhome Suites franchisees, covering both pre-opening and ongoing operations. Before a hotel opens, the franchisor assists with site selection approval, reviews and comments on architectural and design plans (required for new construction), and provides Construction Advisory Services (five site visits, mandatory for a franchisee's first Everhome Suites hotel, optional thereafter for an additional fee). The Opening Services department assigns an Onboarding Project Director and Coordinator to monitor project progress, coordinate training, enroll the hotel in marketing programs, and ensure brand standards are met for the initial Quality Assurance Review. Choice Hotels International, Inc. also recommends employing a full-time General Manager and suggests a dedicated salesperson. Training programs are mandatory and include an Owner Immersion Program (ES LAUNCH) for owners (12-15 classroom hours, at North Bethesda, MD or Scottsdale, AZ), a General Manager Operations Certification Program (ESsentials) (25 online hours, 80 on-the-job hours, online/virtual or at a designated property), and Online Staff Certification for all hotel staff (5 online hours, 25 on-the-job hours, online). Inexperienced extended stay hotel operators and their General Managers may be required to attend additional immersive training (2-4 days, in-person or online). Re-licensing training for new owners of existing Choice hotels is also provided remotely. All staff must complete Choice University online training within 90 days of hire. A significant part of initial training covers the choiceADVANTAGE property management system, with 16-22 hours of remote onboarding assistance. Ongoing post-opening assistance includes support from the Extended Stay Brands Team for identifying accounts, developing promotional materials, considering advertising, and creating sales action plans. Quality assurance programs involve periodic hotel visits and guest satisfaction surveys, with consequences for non-compliance. Choice Hotels International, Inc. manages a central reservation system and provides national, international, and regional advertising, promotion, and marketing services funded by the Marketing and Reservation Fee. The franchisor also provides ongoing remote support for the choiceADVANTAGE software (24/7), including enhancements and updates, and requires hardware refreshes every 48 months. Choice Hotels International, Inc. reserves the right to establish a brand-specific Franchise Advisory Council for consultation on System matters. Additionally, Choice Hotels International, Inc. reviews and approves requests for changes in the number of guestrooms.
Initial Training Hours
170
Training Location
North Bethesda, Maryland or Scottsdale, Arizona
Ongoing Support
After opening, Everhome Suites franchisees receive ongoing support from Choice Hotels International, Inc.'s Extended Stay Brands Team, which assists with identifying prospective accounts, developing promotional materials, advertising opportunities, and creating sales action plans. The franchisor administers a quality assurance program through periodic visits and guest satisfaction surveys to ensure compliance with the franchise agreement and brand standards, providing advice on necessary changes. Non-compliance may lead to penalties, mandatory training, reservation suspension, or even termination of the franchise agreement. Choice Hotels International, Inc. also manages a central reservation system and provides national, international, and regional advertising, promotion, publicity, and marketing research, funded by the Marketing and Reservation Fee. Franchisees have access to ongoing remote support for the choiceADVANTAGE property management software, including 24/7 maintenance support, enhancements, updates, and online training. Hardware for this system is required to be refreshed every 48 months. Choice Hotels International, Inc. may also establish a Franchise Advisory Council for the brand to consult on System-related matters, for which franchisees may be required to pay an annual fee.
Franchise Requirements
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Commercial
Owner Participation
Supervisory
Territory Type
Limited
Staffing Notes
Each Everhome Suites hotel must employ a full-time General Manager exclusively for that hotel. This General Manager position is required to be filled no less than four months before the hotel's opening and must be continuously staffed thereafter. Choice Hotels International, Inc. strongly recommends that franchisees also employ a dedicated salesperson, such as a Director of Sales or Sales Manager, whose primary duty is to solicit extended stay or other business solely for the Everhome Suites hotel. All hotel staff must complete their certification track through Choice University's online training system within 90 days of their hire date and be able to present a certificate of completion upon request.