About Classico Collection By Sonesta Franchise
Classico Collection By Sonesta is a hotel franchise brand under parent company Sonesta Holdco Corporation, with franchise opportunities available since 2023.
The brand represents a collection of distinctive hotels that combine classic design sensibility with contemporary comfort, catering to both business and leisure travelers who appreciate elevated accommodations.
The franchise fee is the greater of $75,000 or $500 per guest room.
Classico Collection By Sonesta Franchise Cost & Fees
Minimum Investment
$57.5M
Average Investment
$76.4M
Maximum Investment
$95.4M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $125,000 | One-time payment upon signing |
| Royalty Fee | 5% of Gross Rooms Revenue of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 2.5% of Gross Rooms Revenue (can increase up to 3.5%) | National brand fund |
| Total Investment Range | $57,495,342 – $95,375,876 | Includes build-out, inventory, working capital |
The investment range of $57.5M–$95.4M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% of Gross Rooms Revenue) and marketing fee (2.5% of Gross Rooms Revenue (can increase up to 3.5%)) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Initial Fee | $125,000 | $125,000 |
| Onboarding Administration Fee | $5,000 | $5,000 |
| Revenue Management System Installation | $1,250 | $10,000 |
| Revenue Management System Training | $0 | $8,950 |
| IT Implementation Services Fee | $0 | $0 |
| Property Management System Hardware & Installation Fee | $25,000 | $40,000 |
| Ancillary System Hardware, Network, Administration | $50,000 | $150,000 |
| Sales Technology Platform Implementation Costs | $12,735 | $20,000 |
| PIP Fee | $0 | $0 |
| PIP Reinspection Fee | $0 | $0 |
| Custom Architecture & Design Review | $0 | $25,000 |
| Initial Brand Training Fee and Reimbursement of Expenses | $5,000 | $7,500 |
| Initial Training Expenses | $1,000 | $2,000 |
| Real Estate, Legal and Title Expenses | $0 | $0 |
| Construction and Improvement Costs | $43,750,000 | $75,000,000 |
| Permits and Licenses | $250,000 | $900,000 |
| Furniture, Fixtures, and Equipment | $7,812,500 | $10,500,000 |
| Operating Supplies and Equipment | $2,500,000 | $3,125,000 |
| Contingences | $1,750,000 | $3,000,000 |
| Lender Comfort Letter Fee | $2,000 | $2,000 |
| Initial Operations, Pre-Opening Expenses, Marketing and Advertising Expenses | $62,500 | $250,000 |
| Signage | $31,250 | $156,250 |
| Insurance | $146,357 | $519,426 |
| Branded Landing Page Installation | $1,000 | $10,000 |
| Guest Wi-Fi and In-Room Entertainment Installation | $209,750 | $259,750 |
| Photography Expenses | $5,000 | $5,000 |
| Construction Start Date Extension Fee | $0 | $5,000 |
| Additional Funds (during the first 3 months of operation) | $750,000 | $1,250,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | The then-current Initial Fee |
| Renewal Fee | The then-current Initial Fee |
| Technology Fee | $9.00 per Guest Room per month |
| Audit Fee | Cost of audit, including the charges of attorneys and independent accountants and the travel expenses, room and board, and compensation of our employees (if underreported by 2% or more) |
| Loyalty Program | 4.5% of Qualified Room Revenue |
| Reservation Fees | $1.75 to $9.50 per reservation |
| Travel Agency Commissions | 10% of TAC Consumed Revenue |
| Travel Agency Commission Settlement Fee | Currently up to $0.85 per transaction |
| Meetings and Events Commission | 5% on consumed master folio per group |
| Travel Management Company (“TMC”) and Consortia Fees | $3.50 per room night (in addition to standard travel agency commission) |
| Corporate Account Support Subscription and Services | $112.91 to $183.33 per month |
| Guest Relations Program | $25 to $125 per issue |
| Operations Insights | $125 per month |
| Online Review Response Fee | $39 to $150 per response |
| Quality Assurance Annual Inspection | Currently, $2,000 once per year, plus travel, lodging, and meals. Re-inspection $4,000 plus travel, lodging, and meals. |
| Quality Assurance and Guest Satisfaction Deficiency Remediation | Up to $5,000 per occurrence, plus travel, lodging, and meals |
| Brand Conference Fee | Currently, $100 per month (additional $695 per attendee) |
| Initial Brand Training Fee | $5,000, plus reimbursement of our travel costs and expenses (up to $2,500 for in-person) |
| Ongoing Training Fees | In-person/on-site: $2,000/day, plus travel costs and expenses. Virtual Ad-Hoc: $200 per hour. |
| Non-Compliance Fee | 1% of Gross Rooms Revenue per month of non-compliance |
| Late Payment Charge | Lesser of 1.5% per month or the maximum rate permitted by applicable law |
| Reactivation Fee | Currently, the lesser of 25% of past due balances or $2,000 |
| Insurance | Currently, $500 per month, plus reimbursement for all premiums, costs, and expenses we incur |
| Taxes | Varies |
| Indemnification | Varies |
| Administrative Fee for Lender Comfort or Other Requests | $2,000 per lender comfort letter and up to $5,000 per other request, plus additional costs |
| PIP Fee | $5,000 per PIP |
| PIP Reinspection Fee | $5,000 per occurrence |
| Photography Expenses | Up to $5,000 |
| Custom Architecture & Design Review | Up to $25,000 |
| Default Remedies | Reimbursement for all our costs and expenses we incur to remedy your default |
| Lost Revenue Damages | Calculated based on remaining term and average monthly Gross Rooms Revenue |
| Pre-Opening Damages | $3,600 per Guest Room |
| Unauthorized Opening Damages | $5,000 per day, plus our costs |
| Failure to De-Identify Damages | $500 per day, plus our expenses |
| Revenue Management For Hire | $995 to $2,500 per month |
| Revenue Management System | $9.53 per Guest Room per month |
| Market Intelligence | $250 per month |
| American Hotel & Lodging Association Fee (“AHLA”) | $4.50 per room per year |
| Reservation System Maintenance Fee: Future Rate and Inventory | $250 – 1st occurrence, $500 – 2nd occurrence, $1,000 – per occurrence thereafter |
| Reservation System Maintenance Fee: Central Reservation System Services | $150 per occurrence |
| Alternative Payment Fee | $25 processing fee per paper check. 3% processing fee for credit card payment. |
| Guest Room Addition Fee | The greater of $500 per additional Guest Room or $5,000 |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Up to 4 days for initial training |
| Classroom Training | 0 |
| On-the-Job Training | 16 – 30 |
| Training Location | Virtual or on-site |
| Additional Training | We may require your Hotel Representative(s), you (or your Principal), and/or previously trained and experienced employees to attend and complete to our satisfaction various training courses that we periodically choose to provide at the times and locations that we designate, including courses and programs provided by third parties we designate. Attendance will not be required for more than five days during any calendar year. |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Non-exclusive |
| Exclusive Territory | No |
| Description | We grant franchisees a non-exclusive license to operate Brand Hotels at a specified location. You will not receive an exclusive territory and may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control. We retain the right to engage in any and all activities we deem appropriate, anywhere in the world, including establishing and operating other Brand Hotels or Network Hotels. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 20 years |
| Renewal Term | One additional 20-year term |
| Renewal Fee | The then-current Initial Fee |
| Renewal Conditions | To renew, you must: give timely notice; have substantially complied with the Franchise Agreement and not received four or more default notices; be in full compliance with the Franchise Agreement and Brand Standards; maintain possession of premises and remodel as necessary; if required, transition to a different brand concept; correct any deficiencies; sign our then-current franchise agreement and ancillary agreements; pay the renewal fee; and you and your owners must sign a general release. |
| Transfer Fee | The then-current Initial Fee |
| Transfer Conditions | You may not transfer without our prior written consent. Conditions for approval include: all fees and reports are current; no violations of the Franchise Agreement; transferee, its owners, and affiliates have no interest in a Competitive Business; provision of all requested information; transferee completes required training; landlord consents to transfer; transferee agrees to meet for inspection and PIP completion within 120 days; transferee signs our then-current franchise agreement; transferee meets new franchisee qualifications; payment of transfer fee; you and your owners sign a general release; and you cease identifying as a current/former franchisee. |
| Termination for Cause | We may terminate for various defaults, including: failure to pay amounts due within 10 days; bankruptcy/insolvency; failure to discharge judgments over $100,000; loss of possession of Hotel; failure to timely commence/complete construction/renovation; failure to open by Opening Date; failure to continuously operate; contesting our ownership of Marks or Franchise System; unauthorized use/disclosure of Confidential Information; engaging in a Competitive Business; unauthorized transfer; failure to maintain insurance; repeated noncompliance (same noncompliance within 24 months, or 3+ breaches within 12 months). |
| Non-Compete Period | During the Term |
| Non-Compete Details | During the Term, neither you, any of your owners, nor any of your or your owners’ immediate family members will: have any direct or indirect ownership interest (except <5% publicly traded) in a Competitive Business; perform services for a Competitive Business; or appropriate, use, or duplicate the Franchise System or Brand Standards for any other business. A 'Competitive Business' is any entity that owns, franchises, or provides services to a hotel brand that competes with Brand Hotels or Network Hotels, with exceptions for passive investors, franchisees, or management companies operating multiple brands. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | No |
| Participation Details | You are not required to participate personally in the direct operation of your Hotel, though recommended. Your Hotel must be managed by a full-time General Manager who meets our qualifications and completes training. You may engage an approved management company, which must sign a joinder agreeing to be bound by the Franchise Agreement and be jointly and severally liable for your obligations (except actual payments). If you are a legal entity, your Principal (a natural person with at least 25% ownership and voting power) must have chief executive officer authority. You and specified personnel must not engage in a Competitive Business during the term. |
| Required Suppliers | We reserve the right to approve or designate all vendors and suppliers of Supplies and services you use in developing, operating and promoting your Hotel. We may designate a sole supplier or approved suppliers (which may be us or our affiliates) from which you will be required to purchase certain Supplies. |
| Supply Restrictions | You must strictly comply with all Brand Standards. In constructing or renovating and operating your Hotel, you must use only those products, supplies, equipment, furnishings, and services that we have approved according to our Brand Standards for appearance, function, and performance. |
| Franchisor Revenue from Suppliers | We may receive volume-based allowances from certain Approved Suppliers, generally ranging from 1% to 4% of net or gross sales on items like FF&E, operating/maintenance equipment and supplies, merchant processing, services, and food and beverage products. In 2022, RLHC received $5,075 from vendors based on purchases by all Network Hotels. SRLHF derived $11,781,850 (29.1% of its revenue) from purchases of goods and services by franchisees and licensees of all Network Brands. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | Yes |
| Description | We may offer incentives (financial contributions) for new Classico brand hotels, typically ranging from $4,000 to $9,000 per Guest Room. To receive an Incentive, you and your principals must sign a development incentive promissory note. The Incentive is disbursed within 10 days after your Hotel opens and is repayable only if the Franchise Agreement terminates before its expiration or a transfer occurs. The repayable amount is reduced annually based on the term. If repayable, it bears 18% interest per annum if not paid when due. We do not require security interest, but owners with 20% or more interest must guarantee obligations. |
Classico Collection By Sonesta Franchise Earnings — Item 19
Classico Collection By Sonesta does not make an Item 19 financial performance representation in their FDD. This means they do not disclose revenue, profit, or earnings data for franchised locations. Before investing, ask the franchisor directly for franchisee contact information so you can speak with existing owners about their actual financial performance.
Classico Collection By Sonesta does not include an Item 19 financial performance representation in their FDD. Contact information for current and former franchisees is listed in Item 20 of the FDD.
Classico Collection By Sonesta Litigation & Risk Flags
4 Pending Actions ListedReview the full FDD for details on pending litigation.
Litigation and bankruptcy data is sourced from Items 3 and 4 of the FDD. Always verify current status directly from the most recent FDD.
Classico Collection By Sonesta System Growth
Total Units
1
Franchised
1
Company-Owned
0
Classico Collection By Sonesta currently operates 1 franchised locations and 0 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 0 | 0 | 0 |
| 2021 | 0 | 0 | 0 |
| 2022 | 0 | 0 | 0 |
Transfers: 0 | Closures: 0
State Registrations
Registered in 15 states: CA, HI, IL, IN, MD, MI, MN, NY, ND, OR, RI, SD, VA, WA, WI
Franchisor Financials (Item 21)
Revenue
$54.0M
Net Income
$-3,186,000
Total Assets
$95.8M
Classico Collection By Sonesta Franchise — FAQ
The total investment to open a Classico Collection By Sonesta franchise ranges from $57,495,342 to $95,375,876, per their Franchise Disclosure Document. This includes the initial franchise fee of $125,000. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
Classico Collection By Sonesta charges a royalty fee of 5% of Gross Rooms Revenue of gross sales, plus a 2.5% of Gross Rooms Revenue (can increase up to 3.5%) contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Classico Collection By Sonesta Franchise Disclosure Document free on this page. The FDD is a public document filed with state franchise registries. Always also request the current FDD directly from Classico Collection By Sonesta to ensure you have the most up-to-date version.
Classico Collection By Sonesta does not provide an Item 19 financial performance representation in their FDD, which means they do not disclose franchisee revenue or earnings data. Prospective investors should contact existing franchisees directly (listed in Item 20 of the FDD) to gather real-world financial performance information.
Classico Collection By Sonesta has been franchising since 2023. The FDD shows an investment range of $57,495,342-$95,375,876, a 5% of Gross Rooms Revenue royalty, and no Item 19 earnings disclosure. There are 4 pending litigation action(s). Review the full FDD and contact current franchisees listed in Item 20 before making any investment decision.
The franchise fee is $125,000 and the total investment ranges from $57,495,342 to $95,375,876 depending on location size and market. Contact the franchisor directly for current net worth and liquid capital requirements, territory availability, and application details.
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Data Source & Disclaimer: This website is for informational purposes only. It is not an offer to sell or buy a franchise. This profile is based on publicly available FDD data sourced from state franchise registry filings. All information is for research purposes only and does not constitute legal, financial, or investment advice. Data may be outdated or contain errors. Always obtain the current FDD directly from Classico Collection By Sonesta and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with Classico Collection By Sonesta or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com