About The Luxury Collection Franchise
The Luxury Collection is a full-service hotel franchise operated under Marriott International, Inc.
Franchisees establish and operate luxury hotels, resorts, and suites that cater to both business and leisure travelers.
Hotels vary in size and may offer boutique lodging experiences, catering, ballrooms, meeting rooms, business centers, recreational facilities, and an array of food and beverage options.
The Luxury Collection Franchise Cost & Fees
Minimum Investment
$144.0M
Average Investment
$189.0M
Maximum Investment
$234.0M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $100,000 | One-time payment upon signing |
| Royalty Fee | 5% of Gross Room Sales plus 2% of Gross Food and Beverage Sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 1% of Gross Room Sales (Marketing Fund Contribution, part of Program Services Contribution), capped at $450,000 per year | National brand fund |
| Total Investment Range | $143,995,890 – $234,025,390 | Includes build-out, inventory, working capital |
The investment range of $144.0M–$234.0M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% of Gross Room Sales plus 2% of Gross Food and Beverage Sales) and marketing fee (1% of Gross Room Sales (Marketing Fund Contribution, part of Program Services Contribution), capped at $450,000 per year) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Initial Franchise Application Fee | $100,000 | $100,000 |
| Pre-Opening Training, Revenue Management, Marketing & Digital Support and Related Services | $135,000 | $222,000 |
| Property Management System, Reservation System, Yield Management System, and Sales and Catering System | $133,000 | $225,000 |
| Other Systems and Training | $42,000 | $135,000 |
| Market Feasibility Study | $15,000 | $25,000 |
| Independent Hotel Brand Assessment and Implementation | $125,000 | $350,000 |
| Building Construction (per guestroom x 200) | $116,020,000 | $193,360,000 |
| Kitchen and Laundry Equipment (per guestroom x 200) | $1,760,000 | $2,240,000 |
| Furniture and Fixtures (per guestroom x 200) | $13,660,000 | $17,460,000 |
| Technology Hardware & Software and Network Infrastructure (per guestroom x 200) | $1,580,000 | $3,360,000 |
| Operating Supplies (per guestroom x 200 plus per hotel) | $2,764,900 | $3,537,400 |
| Professional Design Services (per guestroom x 200) | $5,800,000 | $9,660,000 |
| Food Safety and Sanitation Compliance | $490 | $490 |
| Opening Advertising | $200,500 | $250,500 |
| Additional Funds (first 3 months, per guestroom x 200) | $700,000 | $1,600,000 |
| Start-Up Costs (per guestroom x 200) | $960,000 | $1,500,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | Greater of $150,000 or $500 per guestroom |
| Renewal Fee | Not applicable (franchise agreement is not renewable) |
| Technology Fee | Covered primarily through Program Services Contribution; additional fees include POS system $17-$30/month per workstation, PC Security $13.81-$25.00/PC/month, Mobile Device Management $9-$10/device/month, Lock System Software $8-$11/guestroom/year, Credit Card Processing $0.047/transaction |
| Audit Fee | Annual audit covered by Program Services Contribution; re-audits/replacement audits $2,850-$4,500 per audit |
| Program Services Contribution | 2.32% of Gross Room Sales plus $40,000/year plus $450/guestroom/year |
| Marriott Bonvoy Loyalty Program | 4.2% of qualifying revenue plus 1% of qualifying event revenue (max $300/event) |
| Transaction-Based Media | 8% of applicable gross room revenues, not to exceed $200 per stay |
| Learning & Development Bundle | $17.40-$19.20 per guestroom per year |
| Red Zone charges | $25-$100 per guestroom (max $50,000 per tracking period) plus $2,500 per required meeting |
| Expansion Fee | $400 per guestroom |
| Removal of Hotel from System | $32,000 |
| Intermediary Payments/CTAC | Varies (10% Preferred Travel Agency, up to 7% group intermediary commissions) |
| QuickGroup Online Booking | 2% of gross group room revenue and function space revenue |
| Stars Program | $995 annually |
| Cooperative Advertising | Varies |
| Gift Cards | Varies (up to 10% redemption charge) |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Varies by role; on-site pre-opening training averages 14 days (up to 21 days); Brand Immersion 3 days; Executive Orientation required 12 months prior to opening |
| Classroom Training | Brand & Service Training: 10-16.5 hours; Ethics training: 1.5-3.5 hours; Functional Operations: 0.5-6.5 hours; Administrative: 0.5-1 hour; Electronic Systems: 4-50 hours; Leadership Development: 8-32 hours; Loyalty: 0.5-1 hour; Alcohol Awareness: 4 hours; Food Safety Certification (Management): 8 hours; Food Safety (Associates): 2 hours; Food Allergen: 1 hour |
| On-the-Job Training | None specified for formal programs; on-site task force training provided for 14-21 days |
| Training Location | Varies — web-based, on-site at hotel, and at Marriott-designated locations |
| Additional Training | FITM program ($60,000) or FOND program ($20,000) for new-to-Marriott franchisees; FITM-R ($60,000) or API ($20,000) for existing hotel acquisitions; General Manager brand immersion ($2,500/person); Regional/Continental GM conferences required; ongoing Learning & Development Bundle ($17.40-$19.20/guestroom/year) |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Non-exclusive |
| Exclusive Territory | No |
| Territory Size | Generally no territory granted; if granted, typically limited to 5 years or less, may be defined as a radius or by geographic boundaries |
| Description | Franchisee receives no exclusive territory. Marriott and affiliates retain rights to develop, own, operate, lease, license, franchise, and manage other hotels and lodging products at any location, including adjacent to franchisee's hotel. If a restricted territory is granted, it applies only to The Luxury Collection Hotels, for 5 years or less, excludes existing/under-development hotels, chain acquisitions, residential/condominium products, and non-Luxury Collection Marriott brands. Franchisee has no options, rights of first refusal, or similar rights to acquire additional franchises. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 20 years (typically ends on the 20th anniversary after hotel opens as a system hotel) |
| Renewal Term | Not renewable — franchise agreement expires at end of term with no renewal rights |
| Renewal Fee | Not applicable |
| Renewal Conditions | Not applicable — agreement is not renewable. After expiration, Marriott may in its sole discretion agree to enter into a new franchise agreement on then-current form with materially different terms. |
| Transfer Fee | Greater of $150,000 or $500 per guestroom |
| Transfer Conditions | Requires Marriott consent; transferee must submit application and pay application fee; satisfy current owner qualifications; retain qualified management company; sign new franchise agreement with then-current fees and standards; complete property improvement plan; all amounts owed paid; general release of claims signed; Marriott outside counsel costs paid; hotel must be in good standing under quality assurance program; no uncured breach |
| Termination for Cause | Immediate termination (no cure): bankruptcy/insolvency, becoming a Restricted Person, violation of applicable law, becoming a Competitor, unauthorized transfer, dissolution, loss of right to operate hotel, cessation of operations, pattern of underreporting (3+ times in 24 months), public health/safety threat, failure to meet quality assurance thresholds, disclosure of confidential information, 3+ written default notices in 24 months. With 30-day cure: failure to start/complete construction, failure to pay, default under other agreements, conviction of serious crime, failure to comply with standards, other breaches. |
| Non-Compete Period | During term and potentially after termination (if casualty termination, liquidated damages owed if replacement non-Marriott hotel operated at site during original term; right of first refusal survives 6 months after early termination for competitor transfers) |
| Non-Compete Details | During term: may not use hotel to divert business to or promote other businesses; may not sell/lease hotel to or become a Competitor without Marriott approval. After termination: if hotel damaged by casualty and franchisee operates non-Marriott lodging at the site during remaining original term, must pay liquidated damages. Marriott has right of first refusal to purchase hotel if proposed transfer to Competitor, surviving 6 months after early termination. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | No |
| Participation Details | Franchisees must either operate the hotel themselves or hire a management company consented to by Marriott. A general manager who has completed Marriott's training program must directly supervise on-premises full-time. Marriott may determine franchisee is not qualified to operate and require hiring of an approved management company. If franchisee is an entity, principals may be required to sign a guaranty. On-premises manager/management company not required to have equity interest in the business. |
| Required Suppliers | Franchisees must use FF&E, OS&E, and other goods/services conforming to Marriott standards and specifications. Marriott may specify particular models or brands available from only one manufacturer. Certain food products, FF&E, OS&E, communication systems must be purchased from Marriott or designated/approved sources. Pepsi products are required for certain beverages. Building signs must comply with product quality standards and exterior plaque must be purchased from designated vendor. |
| Supply Restrictions | 70%-92% of total establishment costs and 46%-60% of ongoing operating costs must be purchased through Marriott, affiliates, approved suppliers, or subject to Marriott standards. Alternate suppliers require written request and approval process. |
| Franchisor Revenue from Suppliers | Approximately $29,833,312 in 2022 from franchisee required purchases (less than 0.14% of total gross revenue of $20,773,000,000). Includes catalog fees, Hotels at Home revenue, Simmons rebates, credit card service fees, AT&T credits, and Pepsi unrestricted allowances. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | Yes |
| Description | Generally does not offer direct financing or guarantee financing. However, under very limited circumstances and at sole discretion, may offer credit support in the form of a contingent guaranty of a portion of a third-party loan, or may make a mezzanine loan. Also offers a Diversity Development Incentive Program for historically underrepresented diverse owners (Women, Black, Latino/Hispanic, First Nations/Native American) with discounted application fees ($10,000), key money ($3,500 per guestroom), and reduced franchise fees (2.5% years 1-2, 4% year 3, 5% year 4+). A similar diversity incentive program for relicense transactions is being established. |
The Luxury Collection Franchise Earnings — Item 19
The Luxury Collection 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.
The Luxury Collection 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.
The Luxury Collection Litigation & Risk Flags
8 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.
The Luxury Collection System Growth
Total Units
17
Franchised
12
Company-Owned
5
The Luxury Collection currently operates 12 franchised locations and 5 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 1 | 1 | 11 |
| 2021 | 1 | 1 | 11 |
| 2022 | 1 | 0 | 12 |
Transfers: 1 | Closures: 0
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
$20773.0M
Net Income
$2358.0M
Total Assets
$24815.0M
Audited by Ernst & Young LLP for year ending December 31, 2022.
The Luxury Collection Franchise — FAQ
The total investment to open a The Luxury Collection franchise ranges from $143,995,890 to $234,025,390, per their Franchise Disclosure Document. This includes the initial franchise fee of $100,000. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
The Luxury Collection charges a royalty fee of 5% of Gross Room Sales plus 2% of Gross Food and Beverage Sales of gross sales, plus a 1% of Gross Room Sales (Marketing Fund Contribution, part of Program Services Contribution), capped at $450,000 per year contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the The Luxury Collection 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 The Luxury Collection to ensure you have the most up-to-date version.
The Luxury Collection 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.
The Luxury Collection has been franchising since 1998. The FDD shows an investment range of $143,995,890-$234,025,390, a 5% of Gross Room Sales plus 2% of Gross Food and Beverage Sales royalty, and includes an Item 19 earnings disclosure. There are 8 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 $100,000 and the total investment ranges from $143,995,890 to $234,025,390 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 The Luxury Collection and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with The Luxury Collection or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com