About Tapestry Collection by Hilton Franchise
Tapestry Collection by Hilton is an upscale hotel franchise within the Hilton portfolio, featuring a curated collection of unique, independent hotels that maintain their individual character while benefiting from the Hilton brand, reservation system, and loyalty program.
Franchising since 2016 under Hilton Domestic Operating Company Inc., the brand appeals to travelers seeking distinctive, one of a kind hotel experiences.
The initial franchise fee is $75,000 plus $400 for each guest room or suite over 250.
Tapestry Collection by Hilton Franchise Cost & Fees
Minimum Investment
$3.1M
Average Investment
$60.6M
Maximum Investment
$118.0M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $75,000 plus $400 for each additional guest room or suite over 250 | One-time payment upon signing |
| Royalty Fee | 5% of Gross Rooms Revenue of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 4% of Gross Rooms Revenue | National brand fund |
| Total Investment Range | $3,123,705 – $118,013,332 | Includes build-out, inventory, working capital |
The investment range of $3.1M–$118.0M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% of Gross Rooms Revenue) and marketing fee (4% of Gross Rooms Revenue) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Franchise Application Fee (Note 1) | $75,000 | $75,000 |
| Property Improvement Plan (Note 2) | $0 | $10,000 |
| Market Study (Note 3) | $0 | $0 |
| Environmental Assessment (Note 4) | $0 | $0 |
| Real Property (Note 5) | $0 | $0 |
| Construction and Leasehold Improvements (Note 6) | $0 | $79,500,000 |
| Designer & Engineering Fees | $0 | $3,500,000 |
| Furniture, Fixtures & Equipment (Note 7) | $0 | $14,000,000 |
| Inventory & Operating Equipment (Note 8) | $1,400,000 | $3,000,000 |
| Signage (Note 9) | $1,000 | $15,000 |
| Computer Hardware and Software (Note 10) | $150,695 | $332,655 |
| Guest Internet Access Program (Note 10) | $116,000 | $186,000 |
| Delphi Sales and Events System (Note 10) | $1,500 | $41,000 |
| Required Pre-Opening Training (Note 11) | $5,000 | $15,000 |
| ADA Consultant Fee (Note 12) | $6,000 | $15,000 |
| Construction/Renovation Extension Fee (Note 13) | $0 | $10,000 |
| Insurance (Note 14) | $0 | $0 |
| Organizational Expense (Note 15) | $75,000 | $260,897 |
| Permits & Licenses (Note 16) | $0 | $1,200,000 |
| Miscellaneous Pre-Opening & Project Management Expenses (Note 17) | $570,000 | $1,800,000 |
| Contingencies (Note 18) | $0 | $7,950,000 |
| Additional Funds (Note 19) | $700,000 | $1,100,000 |
| Eforea Spa Initial Fee (Note 20) | $0 | $25,000 |
| Additional Funds for Eforea Spa Implementation (Note 21) | $0 | $4,950,000 |
| Other Required Pre-opening Services Fees (Note 22) | $23,510 | $27,780 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | Change of Ownership Application Fee: Currently, $125,000; Permitted Transfer Processing Fee: Currently, $5,500 |
| Technology Fee | OnQ Additional Rooms Fee: Currently, $120 per additional guest room; OnQ Connectivity Fees: Currently, between $1,485 and $2,150 per month; OnQ Interface Fees: Currently, $1,000 per additional interface; OnQ Maintenance Support Fees: Currently, $1,500 to $5,500 per month; OnQ Email Fees: Currently, $7.92 per user per month and $12.50 per month for delivery to mobile devices; Delphi Sales and Events System: Currently, $858 per user per year |
| Audit Fee | Actual amount of deficiency plus interest |
| Monthly Spa Royalty Fee | 2% of Gross Spa Revenue |
| Room Addition Fee | Currently, $400 per guest room or suite, multiplied by the number of additional guest rooms |
| Guest Assistance Program: Customer Satisfaction Guarantee | $300 per handled transaction for Hilton Honors Diamond members, $250 per handled transaction for Hilton Honors Gold members, and $200 per handled transaction for all other guests |
| Guest Assistance Program: Price Match Guarantee | Hotels must honor a 25% discount off the lower rate on all approved claims |
| Guest Assistance Program: First Contact Resolution | Currently, $15 administrative fee |
| Guest Assistance Program: Online Complaints | $25 per complaint administrative fee |
| Quality Assurance Re-evaluation Fee | Currently, $480 to $3,000 per re-evaluation visit |
| Quality Assurance Special Re-evaluation Fee | Currently, $3,000 per re-evaluation visit |
| Brand Conference | Currently, $2,500 per attendee |
| General Manager Training | Currently, up to $1,200 per attendee |
| Commercial Leader Training | Currently, up to $1,200 per attendee |
| Hilton Core Sales Skills Training | Currently, up to $850 per attendee |
| Training Programs and Training Materials | Currently, up to $5,000 per program per attendee |
| Travel Clubs | Currently, $0.30 per available room plus 10% commission |
| Hilton Advance Program | Currently, 1.35% of eligible Digital Direct Revenue, not to exceed $30 per stay |
| Group Preferred Partnership Program | Currently, $1.50 per transaction, plus the applicable commission |
| Frequent Traveler/Guest Reward Program | Currently, 4.3% of total eligible guest folio |
| Hilton Honors Event Planner Bonus Program | Currently, $0.0025 to $0.0050 per Hilton Honors bonus point awarded |
| Online Group Event Booking Charges | Currently, up to 2% of GRR and up to $25 for included meeting space, plus applicable commissions |
| Centralized Payment Programs: Third-Party Reservation Charges | currently, up to $5.45 per stay |
| Centralized Payment Programs: FastPay Program | currently, up to $1.40 per transaction, plus commission |
| Travel Planner Centralized Payment Program | currently, $0.18 per transaction processing charge plus up to a 10% commission |
| Unlimited Rewards Program | currently, $0.71 for a weekday stay (Monday -Thursday nights), $1.42 for a weekend stay with 1 Fri/ Sat/Sun night, and $2.13 for a weekend stay with 2 Fri/Sat/Sun nights. Double Dollars amounts increase to $1.42, $2.63 and $3.84, respectively. |
| Public Offering or Private Placement Processing Fee | Currently, $5,000 |
| Lender Comfort Letter Processing Fee | Currently, $3,500 for Lender Comfort Letters and $1,500 for Lender Comfort Letter Assignments |
| Management Fees | Fees will be established by mutual agreement |
| Actual Damages Under Special Circumstances | Varies |
| Default Remedies | Actual expenses |
| Indemnification | Actual amount paid by us or our affiliates due to any claim, demand, tax, penalty, or judicial or administrative investigation or proceeding arising from any claimed occurrence at your Hotel |
| Insurance | Actual amount |
| Liquidated Damages for Unauthorized Opening | $5,000 per day that your Hotel is open without authorization, plus our costs |
| Liquidated Damages for Pre-Opening Termination | $10,000 multiplied by the number of approved Guest Rooms at the Hotel |
| Liquidated Damages for Post-Opening Termination | The greater of: (a) the Hotel’s Average Monthly Royalty Fees multiplied by 60; or (b) $10,000 multiplied by the number of approved Guest Rooms at the Hotel. OR The Hotel’s Average Monthly Royalty Fees multiplied by 60. OR The Hotel’s Average Monthly Royalty Fees multiplied by the number of months remaining in the Term. |
| Service Charges for Overdue Payments | 1.5% per month or highest percentage permissible by law, whichever is less |
| Taxes | Actual amount |
| Identity, Sales, and Distribution Non-Compliance Fee | Currently, $500 per instance |
| Franchise Agreement Non-Compliance Fee | 1% of Gross Rooms Revenue |
| FastPay Non-compliance Fee | Varies and escalates based on the number of violations. Currently, up to the greater of $3,000 or 10% of gross group room revenue (not to exceed $7,500) per violation. |
| Consultation and Service Fees | Set by us on a project-by-project basis |
| Consortia Program | Currently, up to $2.70 for each consumed night booked under the Consortia “parity” rate, plus applicable commission |
| TMC Pay-On-All-Pay-For Performance Program | Currently, $1.03 plus up to 10% commission or fee, where applicable, for each consumed night booked by a TMC travel agency |
| US Government Travel Agency Programs | Currently, up to $2.30 and/or up to 10% of room revenue |
| ResMax Program | Currently, 5.15% to 5.65% of consumed revenue from a ResMax booking with a 3-night maximum |
| Revenue Management Consolidated Center (RMCC) Category 1 – One Time Service Models | currently $1,645 |
| Revenue Management Consolidated Center (RMCC) Category 2 – Monthly Full Support Models | currently $2,395 to $14,300 |
| Revenue Management Consolidated Center (RMCC) Category 3 – Monthly Reports Only Models | currently $1,095 to $1,695 |
| Revenue Management Consolidated Center (RMCC) Category 4 – Monthly Lead Management Service Models | currently $1,095 to $1,545 |
| Revenue Management Consolidated Center (RMCC) Category 5 – Monthly Group Rooms Coordinator Models | currently $745 to $4,995 |
| Procurement and Services Fees | Currently, 4% to 10% of project cost |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Varies |
| Classroom Training | Varies |
| On-the-Job Training | 0 |
| Training Location | Varies, Virtual, Online, On-site |
| Additional Training | Franchisor specifies initial and ongoing required and optional training programs. Franchisees pay fees for programs and materials, and bear costs for wages, travel, lodging, food, and other expenses for attendees. Some required training courses may be provided without a course fee. |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Non-exclusive |
| Exclusive Territory | No |
| Territory Size | Varies in size and shape from hotel to hotel |
| Description | No protected area or territory is granted in the standard Franchise Agreement. Franchisor and affiliates may compete. Specific "Restricted Area Provisions" may be granted for New Development or Conversion for an agreed-on time period, but these have exclusions (e.g., existing hotels, other brands, gaming-oriented hotels, shared ownership properties, large chains acquired by franchisor). |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | New Construction: 23 years; Conversion: 10 to 20 years; Change of Ownership: Remaining Term under the existing franchise agreement, or such other term as we may approve; Eforea Spa: expires on the earlier of: (i) the termination of the Spa Amendment; or (ii) the expiration or termination of the Franchise Agreement. |
| Renewal Term | You do not have the right to renew or extend the Franchise Agreement. |
| Renewal Conditions | You do not have the right to renew or extend, but if we agree, in our sole discretion, to re-license, you may be asked to sign a contract with materially different terms and conditions from the original Franchise Agreement, and you must comply with any PIP performance conditions that we specify. |
| Transfer Fee | Change of Ownership Application Fee: Currently, $125,000; Permitted Transfer Processing Fee: Currently, $5,500 |
| Transfer Conditions | Permitted Transfers (no change of control, to affiliates, family members, trusts, on death, publicly traded equity, privately held equity <50% change, institutional investment funds) require notice and consent (except for publicly traded equity, privately held equity <50% change, institutional investment funds). Change of Ownership Transfers (change of control) require 60 days' notice, application, fees, no default, resolution of pending suits, transferee meeting requirements, and signing new agreement. Transferee cannot be a Sanctioned Person or Competitor. |
| Termination for Cause | Franchisor can terminate with opportunity to cure (10-30 days) for failure to pay sums due, failure to commence/complete Hotel Work, failure to maintain insurance, or failure to comply with other provisions. Immediate termination without opportunity to cure for repeated non-compliance, multiple defaults, failure to pay debts, bankruptcy, loss of possession, failure to operate for 5 consecutive days, contesting franchisor ownership/validity of marks, adverse conduct, concealing revenues, non-compliant transfer, becoming a Sanctioned Person, or termination of Your Hotel Agreements. |
| Non-Compete Period | during the term of this franchise |
| Non-Compete Details | Franchisee and affiliates may not own, license, or be franchisor of a competing hotel brand. May own minority interest or be a franchisee/manager of a competitor under certain conditions. Cannot operate another spa in, adjacent to, or associated with the hotel while operating an eforea spa. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | No |
| Participation Details | Franchisee is solely responsible for management and operation. If managing directly, prior written approval and training completion are required. If hiring a management company, it must be approved by the franchisor and its key personnel must attend training. Management company changes require franchisor approval. |
| Required Suppliers | Franchisees must purchase exterior signage from a licensed vendor. For eforea spa, must sell specified products and perform required treatments. OnQ software must be licensed from HSS. Guest Internet Access service from a preferred provider. Connected Room system control modules from franchisor or approved vendors. GRO system from IDeaS. Delphi.fdc system from Amadeus Hospitality. |
| Supply Restrictions | Franchisees must build, design, furnish, equip, and supply hotels according to franchisor's Standards. They may be required to purchase particular brands/types of products/services from approved suppliers or designated sources. Franchisor may enter exclusive purchasing arrangements. |
| Franchisor Revenue from Suppliers | HSM (affiliate) had revenues of $9,185,278 in rebates and allowances on purchases made by franchisees in 2021. HSM had revenues of $1,059,584 from sales of goods, services, and/or supplies to franchisees in 2021. HSM received $15,276,529 in administration fees from PSDP Suppliers in 2021. HSS (affiliate) is the only supplier of OnQ software due to its proprietary nature. HSS receives a 10% mark-up on Delphi.fdc license and maintenance fees. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | Yes |
| Description | Franchisor generally does not offer direct or indirect financing, but may offer "Incentives" (financial contributions) for new hotels. An Incentive is a contingent liability, not a loan, reduced annually over the term. If the franchise terminates early or transfers, the repayable amount is due. Interest of 1.5% per month applies to unpaid amounts if accelerated. Franchisor may offer other types of financing (e.g., mezzanine loan, guaranty) in unique circumstances, with terms agreed upon at origination. |
Tapestry Collection by Hilton Franchise Earnings — Item 19
Tapestry Collection by Hilton 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.
Tapestry Collection by Hilton 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.
Tapestry Collection by Hilton Litigation & Risk Flags
2 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.
Tapestry Collection by Hilton System Growth
Total Units
63
Franchised
63
Company-Owned
0
Tapestry Collection by Hilton currently operates 63 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 |
|---|---|---|---|
| 2019 | 11 | 0 | 29 |
| 2020 | 15 | 1 | 43 |
| 2021 | 19 | 0 | 63 |
Transfers: 0 | Closures: 1
State Registrations
Registered in 14 states: CA, HI, IL, IN, MD, MI, MN, NY, ND, RI, SD, VA, WA, WI
Franchisor Financials (Item 21)
Revenue
$883K
Net Income
$885K
Total Assets
$1.5M
Audited by Cherry Bekaert LLP for year ending December 31.
Tapestry Collection by Hilton Franchise — FAQ
The total investment to open a Tapestry Collection by Hilton franchise ranges from $3,123,705 to $118,013,332, per their Franchise Disclosure Document. This includes the initial franchise fee of $75,000 plus $400 for each additional guest room or suite over 250. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
Tapestry Collection by Hilton charges a royalty fee of 5% of Gross Rooms Revenue of gross sales, plus a 4% of Gross Rooms Revenue contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Tapestry Collection by Hilton 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 Tapestry Collection by Hilton to ensure you have the most up-to-date version.
Tapestry Collection by Hilton 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.
Tapestry Collection by Hilton has been franchising since 2016. The FDD shows an investment range of $3,123,705-$118,013,332, a 5% of Gross Rooms Revenue royalty, and no Item 19 earnings disclosure. There are 2 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 plus $400 for each additional guest room or suite over 250 and the total investment ranges from $3,123,705 to $118,013,332 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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