Hyatt House Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$20,168,455 - $57,134,018
Franchise Fee
$75,000
Total US Locations
118
Business Summary
Hyatt House Franchising, L.L.C. offers franchises to operate upscale, extended-stay Hyatt House hotels. These hotels are typically all-suite, offering studio, one-bedroom, and two-bedroom suites with modern technology, design, and entertainment features. They are usually located in primary and secondary cities and provide guests with complimentary hot breakfast, free high-speed internet, a fitness center, swimming pool, and meeting spaces, targeting both corporate and leisure travelers.
Corporate History
Hyatt House Franchising, L.L.C. was originally formed as SF Hotel Company, L.P. and later became Summerfield Hotel Company L.P. It began operating hotels under the Summerfield Suites brand in June 1998 and started offering Summerfield Suites franchises in August 1999. In 2000, the brand became Summerfield Suites by Wyndham. After an acquisition in January 2006 by Select Hotels Group, L.L.C., the entity converted to a Kansas limited liability company named Summerfield Hotel Company, L.L.C. The hotels then operated under the Summerfield Suites name and later Hyatt Summerfield Suites. In September 2011, the company rebranded its hotels to the Hyatt House brand and has offered Hyatt House franchises since February 2006.
Financial Overview
Investment Range
$20,168,455 - $57,134,018
Franchise Fee (Low)
$75,000
Franchise Fee (High)
$150,000
Minimum Net Worth
$7,348,000
Royalty %
5%
Marketing %
3.5%
Equipment Costs (Low)
$2,897,600
Equipment Costs (High)
$8,097,650
Working Capital
$400,500
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
The parent company, Hyatt Hotels Corporation, reported an unqualified audit opinion on its financial statements. However, as of December 31, 2024, Hyatt Hotels Corporation had a negative working capital position, with current assets of $2,733 million and current liabilities of $3,274 million. The company also recognized a significant goodwill impairment charge of $110 million in 2024, stemming from its annual impairment analyses of a reporting unit within the management and franchising segment. The franchisor, Hyatt House Franchising, L.L.C., provides an absolute and unconditional guarantee for the performance of its obligations to franchisees.
Financing Details
Hyatt House Franchising, L.L.C. does not have a standard financial assistance program for franchisees and typically does not offer direct or indirect financing. However, in some situations, it may offer financial assistance to franchisees developing new Hyatt House hotels or converting existing hotels to the Hyatt House brand. There are no formal criteria for determining who receives this assistance or its terms; any assistance offered will depend on the franchisor's discretion and the specific circumstances of the franchisee. The franchisor and its affiliates do not guarantee any franchisee's notes, leases, or other obligations.
Performance Metrics
Total US Locations
118
Franchised Units
109
Corporate Units
9
Avg Square Footage
87,120
Franchising Since
1999
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
1
Litigation Summary
Hyatt House Franchising, L.L.C. disclosed one litigation case during its 2024 fiscal year. This case, Hyatt House Franchising, L.L.C. v. Energy Corridor Hotels LLC, Javanti Kreshav Patel, was an arbitration proceeding filed in 2024 regarding unpaid royalty fees.
Bankruptcy History
Hyatt House Franchising, L.L.C. has no bankruptcy history that is required to be disclosed in this document.
Agreement Terms
Initial Term
20 years
Renewal Term
10 years
Renewal Conditions
To renew a Hyatt House franchise, franchisees must have substantially complied with their agreement during its term and be in full compliance at expiration. They must also meet the franchisor's current standards for franchisees, have received passing quality assurance scores in the previous three years, and have the right to possess the hotel for at least ten years after the current agreement expires. Renewal requires the franchisee to renovate, remodel, or expand the hotel and its furniture, fixtures, and equipment according to a Property Improvement Plan prepared by the franchisor, give notice of intent to renew, sign the franchisor's then-current franchise agreement and related documents (which may include materially different terms and fees, but no successor franchise fee), and sign general releases.
Training & Support Program
Franchisor Assistance
Hyatt House Franchising, L.L.C. provides extensive assistance to franchisees, beginning before the hotel opens. This includes approving the site, communicating design and development specifications, identifying approved suppliers for furniture, fixtures, and equipment, and approving initial design and renovation plans. The franchisor also assists with pre-opening sales office setup, provides IT Project Management Services and technology-related support, and offers access to central reservation systems and advertising listings. Initial training covers owner and management orientation, general manager training, operations, sales, events, revenue management, and pre-opening brand training for hotel staff. Ongoing support includes continuous provision of System Services, periodic advice on hotel operations and marketing, permission to use proprietary marks and confidential information, access to updated System Standards, and listings in advertising publications. The franchisor conducts regular quality assurance inspections, provides hosting and subscription services for the hotel's property management system, and may offer optional revenue management, field marketing, central sales, global property guest services, and digital ancillary services.
Initial Training Hours
482
Training Location
Initial training for Hyatt House franchisees occurs through a combination of virtual sessions, self-paced online learning, and in-person programs. In-person training is typically held at Hyatt's corporate headquarters in Chicago, Illinois, or at other designated Hyatt hotel locations. Additionally, a pre-opening team of trainers provides on-site support and training at the franchisee's hotel before its opening.
Ongoing Support
After opening, Hyatt House franchisees receive continuous access to the franchisor's System Services and ongoing advice regarding hotel operations, System Standards, and marketing. They can use proprietary marks, confidential information, and access updated System Standards. The franchisor provides access to the central reservation system and advertising listings, conducts periodic quality assurance inspections, and offers hosting and subscription services for the hotel's property management system. Optional services such as revenue management, field marketing, central sales, global property guest services, and digital ancillary services are also available.
Franchise Requirements
Ideal Candidate Profile
Hyatt House seeks to franchise with business entities rather than individuals. These entities, or their parent or affiliated entities, should possess at least five years of business experience, which does not necessarily need to be in the lodging industry. They must also demonstrate a minimum net worth of $7,348,000. The franchisee is required to ensure that at least one controlling owner, acting as a guarantor, maintains specified financial thresholds, including a net worth. The franchisee or an approved management company must maintain direct management control over all aspects of the hotel's business. Neither the franchisee nor its owners should be a Competing Brand Owner, which means they cannot be an owner, franchisor, or manager of a competing hotel brand with at least five hotels globally. Management companies must meet Hyatt House's minimum qualifications and ensure their personnel successfully complete all required brand standard training programs.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Min Years Experience
5
Operational Details
Location Type
Commercial
Owner Participation
Supervisory
Territory Type
Limited
Territory Size Requirements
Hyatt House Franchising, L.L.C. defines franchise territories, called an 'Area of Protection,' using geographic references like streets or rivers, or as a circular area centered around the hotel. The size of the Area of Protection varies based on the hotel's size and location, potentially ranging from a few city blocks in urban areas to a radius of up to approximately three miles from the hotel's entrance in certain suburban areas.
Staffing Notes
Hyatt House hotels require a Core Management team to be in place at all times, including a general manager, assistant general manager, and sales director. These Core Management personnel must dedicate all their working time to the hotel's management and operational responsibilities and cannot hold positions at other lodging facilities or in related industries concurrently. The franchisee, or their approved management company, is solely responsible for hiring, training, and setting employment terms for all hotel personnel. If the franchisee chooses to retain a revenue manager, that individual must be certified by Hyatt House Franchising, L.L.C. within 90 days of hire and can provide services to no more than 20 Hyatt House hotels.