About Radisson RED® Franchise
Radisson RED is an upscale select service hotel franchise operated under the Radisson Hotels International system.
Franchisees operate hotels that provide lodging services to leisure and business travelers, offering guest rooms comparable to full-service hotels but with limited food-service operations and limited meeting space.
The hotels feature lounge areas for socializing and working, and the cost for a room is commonly less than at a full-service hotel.
Radisson RED® Franchise Cost & Fees
Minimum Investment
$7.1M
Average Investment
$24.4M
Maximum Investment
$41.8M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $75,000 or $450 per guestroom (whichever is greater) | One-time payment upon signing |
| Royalty Fee | 5% of Total Rooms Revenue of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 2% of Total Rooms Revenue | National brand fund |
| Total Investment Range | $7,050,440 – $41,791,390 | Includes build-out, inventory, working capital |
The investment range of $7.1M–$41.8M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% of Total Rooms Revenue) and marketing fee (2% of Total Rooms Revenue) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Initial License Fee | $75,000 | $75,000 |
| Product Improvement Plan | $0 | $3,000 |
| Construction Extension Fee | $0 | $2,000 |
| Real Estate | $0 | $0 |
| Improvements | $3,500,000 | $30,000,000 |
| Design & Engineering Costs | $500,000 | $1,000,000 |
| Furniture, Fixtures & Equipment | $675,000 | $6,000,000 |
| Interior Design Review Fee | $0 | $3,000 |
| Architectural Plan Review Fee | $0 | $3,000 |
| Technical Services Fee | $0 | $225,000 |
| Exterior Signage | $50,000 | $200,000 |
| Miscellaneous Pre-Opening Costs | $500,000 | $1,000,000 |
| Opening Inventory | $200,000 | $1,200,000 |
| ORACLE Opera Cloud PMS Initial Investment | $30,550 | $30,550 |
| Training Registration Fees and Expenses | $5,000 | $10,000 |
| WebExtra Fee | $150 | $1,100 |
| Start-Up Supplies | $10,000 | $12,000 |
| SalesForce Community Fees | $440 | $440 |
| IDeaS Fees | $4,300 | $4,300 |
| Additional Funds 3 Months | $1,500,000 | $2,000,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | Amount of then-current Initial License Fee or if transferring to an affiliate, greater of $5,000 or the then-current administrative fee |
| Technology Fee | ORACLE Opera Cloud PMS Fee $10-$11/guestroom/month; Technology & Interface Connect Fee $5.95/guestroom/month (max 100); Technology & Interface Support Fee $1.70/guestroom/month (over 100, max 250); PMS Payment Gateway $110-$130/month; Medallia Zingle Oracle OXI Interface Fee $0.35/guestroom/month (max 200) |
| Audit Fee | Cost of audit if underpayment is willful or exceeds 3% |
| Reservation Fee | 2% of Total Rooms Revenue plus $3.75 per delivered reservation |
| Brand Business Conference | $3,990 |
| Administrative Fee | $500-$5,000 per document |
| Late Fees | 1.5% per month interest plus up to $100 late payment fee |
| Inspection Fees | Up to $2,500 plus travel expenses |
| Guest Service Intervention | $125-$200 per complaint/response |
| Product Improvement Plan | $3,000 |
| Construction Extension Fee | $0-$2,000 per month |
| Additional Guestrooms | $450 per guestroom |
| Revenue Optimization Program | $7.25/guestroom/month (max 500 rooms) |
| Information Security/Payment Card Fee | $250 per year |
| Redirected Call Program | $360/year plus $2.00-$2.50 per call |
| Suspension Fee | $1,500 |
| SalesForce Communities | $440 per year |
| CVent Private Label Technology Fee | $149 per year |
| WebExtra Annual Service Plan Fee | $1,554 |
| Medallia Zingle Subscription Fee | $120 per month |
| Radisson Rewards Americas | 5% of Total Rooms Revenue from Member Stays |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Varies by program; multiple required programs |
| Classroom Training | 8-24 hours (New Hotel Orientation); 32 hours (Radisson Hotel Group Leadership Certification); 4-6 hours (Yes I Can! Trainer Certification); plus various online programs |
| On-the-Job Training | N/A for most programs; online training and self-paced components for ORACLE Opera Cloud PMS, CSA Guest Issues, HSA, Revenue Management, and others |
| Training Location | Your Hotel (New Hotel Orientation, Living Responsible Business); Minneapolis, MN (Leadership Certification); Regional Location, Your Hotel, or Minneapolis (Yes I Can!); Online and self-study for most other programs |
| Additional Training | Radisson Academy Online ($425/year); various ongoing online certifications including Information Security & Data Privacy Awareness, Revenue Management System Training, Leading/Living Responsible Business Certification, Hotel Security Training for Protected Data |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Non-exclusive |
| Exclusive Territory | No |
| Territory Size | Single Licensed Location only; may negotiate a Protected Area radius |
| Description | Franchise is limited to a single Licensed Location approved by franchisor. No exclusive territory or protected territory is granted. However, in certain circumstances, franchisor may agree not to operate or license another Radisson RED within a negotiated radius (Protected Area). Even with a Protected Area, franchisor retains extensive rights including operating other Radisson brands, acquiring hotel chains, and using alternative distribution channels within the Protected Area. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 20 years |
| Renewal Conditions | No renewal or extension of term provisions in the License Agreement |
| Transfer Fee | Amount of then-current Initial License Fee, or if transferring to an affiliate, greater of $5,000 or the then-current administrative fee |
| Transfer Conditions | Franchisor must approve all transfers. Transferee must apply and sign current license agreement, comply with training requirements, complete renovation, pay Product Improvement Plan fee, pay all obligations in full, sign termination agreement and release, and pay Transfer Fee. Franchisor has right of first refusal with 45 days to accept offer. |
| Termination for Cause | Franchisor may terminate for default. 10 days to cure monetary defaults, 30 days for other defaults, 48 hours for defaults materially impairing goodwill of Marks or System. Non-curable defaults include insolvency, unsatisfied liens, judgments, foreclosure, failure to operate, felony conviction, 3 material defaults in 36-month period, underreporting revenue, and material misrepresentations. |
| Non-Compete Details | No non-competition covenants during or after the term of the franchise |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | No |
| Participation Details | Franchisee is not required to personally operate the Hotel. If an individual, franchisee or a professional management company approved by franchisor must directly operate the Hotel. If a legal entity, a professional management company approved by franchisor must directly operate the Hotel on its premises. A qualified General Manager must be on-site who meets certain minimum criteria including hospitality degree, CHA certification, or passing the CHA exam. |
| Required Suppliers | Must purchase Start-up Supplies, SalesForce Community platform licenses, reservation services, ORACLE Opera Cloud PMS and related technology from franchisor or designated suppliers. Must use standard interior design packages and purchase FF&E from designated suppliers. Must purchase certain linen, terry items, uniforms, name badges, signage, and other branded items from approved single-source suppliers. |
| Supply Restrictions | Approximately 75-90% of total purchases to begin operating must meet franchisor specifications. Once operating, approximately 15-25% of annual purchases must meet specifications. Must submit unapproved suppliers for review and approval. |
| Franchisor Revenue from Suppliers | In 12 months ended December 31, 2021, total revenues were $38,226,847, of which approximately $226,578 (0.6%) was from sale of required products/services to franchisees. Affiliates received approximately $466,361 from required product/service sales. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | Yes |
| Description | In a few select markets, may offer financing to franchisees who meet creditworthiness requirements and are signing a new License Agreement. Principal amount generally between $3,000 and $8,500 multiplied by number of rooms. No interest charged unless default (then 18%). Loan payable in equal yearly installments over the term of the License Agreement, funded within 30 days after Hotel opens. No prepayment penalties. No security required. |
Radisson RED® Franchise Earnings — Item 19
Radisson RED® 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.
Radisson RED® 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.
Radisson RED® Litigation & Risk Flags
6 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.
Radisson RED® System Growth
Total Units
2
Franchised
1
Company-Owned
1
Radisson RED® currently operates 1 franchised locations and 1 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2019 | 0 | 0 | 0 |
| 2020 | 0 | 0 | 0 |
| 2021 | 1 | 0 | 1 |
Transfers: 0 | Closures: 0
Public Figures (Item 18)
The following public figures are associated with this franchise: Arjun Atwal, Aditi Ashok
State Registrations
Registered in 11 states: CA, HI, IL, IN, MD, MI, MN, RI, SD, VA, WI
Franchisor Financials (Item 21)
Total Assets
$64.0M
Radisson RED® Franchise — FAQ
The total investment to open a Radisson RED® franchise ranges from $7,050,440 to $41,791,390, per their Franchise Disclosure Document. This includes the initial franchise fee of $75,000 or $450 per guestroom (whichever is greater). The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
Radisson RED® charges a royalty fee of 5% of Total Rooms Revenue of gross sales, plus a 2% of Total Rooms Revenue contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Radisson RED® 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 Radisson RED® to ensure you have the most up-to-date version.
Radisson RED® 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.
Radisson RED® has been franchising since 2014. The FDD shows an investment range of $7,050,440-$41,791,390, a 5% of Total Rooms Revenue royalty, and no Item 19 earnings disclosure. There are 6 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 $75,000 or $450 per guestroom (whichever is greater) and the total investment ranges from $7,050,440 to $41,791,390 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 Radisson RED® and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with Radisson RED® or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com