MGallery Hotel Collection Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$3,379,000 - $113,343,740
Franchise Fee
$20,000
Min Cash Required
$3,000,000
Total US Locations
2
Business Summary
The MGallery Hotel Collection franchise offers the right to build new hotels or convert existing properties into upscale, full-service, or limited-service hotels. These hotels operate under the MGallery Hotel Collection brand name and system, providing lodging services for both business and leisure travelers. MGallery Hotel Collection properties are usually found in urban, downtown, and city center locations within primary and secondary cities.
Corporate History
Accor Franchising US LLC, the franchisor for MGallery Hotel Collection, was established as a Delaware limited liability company in November 2018. MGallery Hotel Collection began offering franchises in the United States in March 2020. Globally, there are approximately 122 MGallery Hotels. The franchisor's ultimate parent company, Accor SA, a French company, has a long history in the hotel business, having started in 1967 and currently owning or operating about 5,700 hotels worldwide across various brands. Accor Franchising US LLC does not directly own or manage any MGallery Hotels.
Financial Overview
Investment Range
$3,379,000 - $113,343,740
Franchise Fee (Low)
$20,000
Franchise Fee (High)
$75,000
Minimum Cash Required
$3,000,000
Minimum Net Worth
$6,165,500
Royalty %
5%
Marketing %
1.5%
Equipment Costs (Low)
$55,000
Equipment Costs (High)
$86,150,000
Working Capital
$4,500,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Accor Franchising US LLC demonstrates a strong financial position with no external debt as of December 31, 2024. Its current assets significantly exceed its current liabilities, indicating robust liquidity. The company also reported positive net income in 2023 and 2024, following a loss in 2022. Management assesses the credit risk associated with outstanding balances as nominal, and no allowance for expected credit loss was deemed necessary.
Financing Details
MGallery Hotel Collection does not offer any direct or indirect financing arrangements to its franchisees. The franchisor or its associates also do not guarantee any franchisee notes, leases, or obligations. Franchisees must arrange their own financing through third-party lenders. However, if a franchisee has a secured lender, the franchisor may require a comfort letter to be signed by all parties, which specifies agreements in case of a loan default or foreclosure. The franchisor charges a non-refundable fee for processing this comfort letter.
Performance Metrics
Total US Locations
2
Franchised Units
2
Corporate Units
0
Avg Square Footage
175,000
Franchising Since
2020
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
The MGallery Hotel Collection has no litigation history to report.
Bankruptcy History
The MGallery Hotel Collection has no bankruptcy history to report.
Agreement Terms
Initial Term
20 years
Renewal Term
5 years
Renewal Conditions
To renew an MGallery Hotel Collection franchise, franchisees must meet several conditions. These include adhering to the then-current standards for MGallery Hotel Collection franchisees and maintaining substantial compliance with all terms of the Franchise Agreement and other agreements with the franchisor and its affiliates. Franchisees must also be in "Good Standing," meaning they have no defaults and have satisfied all monetary obligations to the franchisor, its affiliates, and approved suppliers in a timely manner. Additionally, the Hotel Manager and any other designated employees must complete the franchisor's current training requirements. Franchisees are required to upgrade the hotel to conform to the then-current brand standards, sign a general release of claims against the franchisor and its affiliates, and execute the franchisor's then-current renewal franchise agreement, which may have different terms and fees. A renewal fee equal to 50% of the then-current initial franchise fee is also required.
Training & Support Program
Franchisor Assistance
MGallery Hotel Collection provides extensive assistance to its franchisees both before and after opening. Pre-opening support includes approving the site, preparing a Property Improvement Plan (PIP) for conversions, and reviewing preliminary and construction plans. The franchisor also assists with consultant selection and conducts inspections during construction. Franchisees receive approval for furniture, fixtures, equipment, and interior design elements, along with general pre-opening advice. Final on-site visits are conducted to authorize the hotel's opening. Additionally, franchisees are given access to comprehensive Manuals and initial training programs for their General Manager and other key staff. After opening, MGallery Hotel Collection continues to provide support through ongoing training, consultation, and advisory assistance. This includes maintaining the Reservation System, offering online distribution marketing, and implementing MGallery Sales and Marketing Services and Centralized Marketing Programs. The franchisor conducts periodic inspections, guest satisfaction surveys, and third-party audits to ensure compliance with Brand Standards. They also review plans for proposed changes or renovations and establish pricing requirements.
Initial Training Hours
120
Training Location
Virtual, at the Hotel, or at an alternate designated location.
Ongoing Support
MGallery Hotel Collection provides continuous training, consultation, and advisory assistance for the management and operation of the hotel. This includes requiring the Hotel Manager and other designated employees to attend additional or refresher training courses, programs, conferences, and seminars. Franchisees' personnel may also be required to participate in regional and national conventions, meetings, and other brand standard training programs. Ongoing support also encompasses comprehensive IT assistance through services like AccorConnect, AccorSecure, IT Assistance, PCI Assistance, and Mobile Device Management. Additionally, franchisees benefit from ongoing participation in the Voice of the Guest (VOG 2.0) program for reputation management, Leading Quality Assurance (LQA) mystery visits for compliance, the Accor Loyalty Program, and various centralized marketing and distribution services.
Franchise Requirements
Ideal Candidate Profile
The MGallery Hotel Collection seeks franchisees and their owners who possess strong moral character, a positive business reputation, and a solid credit rating. Ideal candidates should demonstrate the aptitude and ability to operate a hotel in line with the brand's standards, along with having sufficient financial resources and capital. Franchisees are required to have a full-time General Manager who will provide on-site management and successfully complete the mandatory training programs. The franchisor also considers the market in which the hotel will operate and other relevant factors when evaluating candidates.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Absentee Allowed
Territory Type
Limited
Staffing Notes
MGallery Hotel Collection requires the Hotel to be managed by a full-time, on-site General Manager who must successfully complete mandatory training programs. Other key management personnel, including the Director of Revenue Management, Director of Sales and Marketing, and Director of Talent & Culture, must also complete initial training. All employees are required to complete initial on-site or virtual training covering topics such as the Heartist Journey, MGallery Brand and Service Culture, sustainability, legislative compliance (harassment, discrimination, and prevention), safety, and ethics. Employees also receive technology training for systems like PMS, POS, and the Reservation System, with hours varying by position. Management personnel are also required to attend ongoing and refresher training programs as designated by the franchisor.