The purpose of this U.S. Hotel Franchise Development Cost Guide is to provide a summary of the total development cost ranges, exclusive of land, that are applicable to various hotel franchise brands as described in their respective Uniform Franchise Offering Circular (UFOC) documents. This guide can be utilized by real estate professionals as a supplement to the HVS Development Cost Survey in assessing total hotel development costs in the context of specific hotel franchise brands. Furthermore, it can also be utilized by hotel developers and investors as a supplement to the HVS U.S. Hotel Franchise Fee Guide to help them analyze the various costs involved in developing a hotel that is to be flagged with a franchised brand. We note that the cost ranges outlined herein apply only to hotel development in the United States.

Summary of Total Hotel DevelopmentCosts

The total development cost ranges and corresponding calculated midpointssummarized in Tables 1, 2, and 3 were derived from information presentedin the UFOC documents of each respective brand; these figures are exclusiveof land cost, as land cost is too variable to estimate. Table 1 summarizes the data for hotel brands in the economy category, which includes brands classified as such by Smith Travel Research (STR). Table 2 presents data for hotel brands in the mid-rate category, which encompasses brands classifiedby STR as being in the mid-scale without food and beverage, and mid-scale with food and beverage categories. Table 3 summarizes data for hotels in the first-class category, which includes brands classified by STR as upscale, upper-upscale, or luxury brands. Our summary includes a total of 91 franchise brands, comprising 29 economy, 33 mid-rate, and 29 first-class brands.

The overall total and the totals per segment include brand variants: for example, Comfort I&S is a variant of Comfort Inn, and Crowne Plaza Resort is a variant of Crowne Plaza.We note that the total development cost ranges and corresponding midpoints, exclusive of land, were sourced from the most recently released UFOC documents available at the time of the guide’s production; these documents were primarily released in 2006. However, four economy brands : (Motel 6, Studio 6, Red Roof Inns, and GuestHouse) reflect data from 2007UFOC documents; these brands are referenced with a footnote within the guide. Aside from land cost, these total development cost ranges may also be exclusive of other development cost components that the franchisors have opted not to include due to the challenges involved in their estimation. Furthermore, the total hotel development cost ranges, exclusive of land, are based on cost estimates for the construction of new hotels. Therefore, these cost ranges cannot be utilized for evaluating the development costs involvedin the conversion of independent hotels to certain hotel brands, or the conversion of branded hotels to other brands.

The development cost ranges, exclusive of land, are also expressed on a per-room basis in the tables. The per-room ranges were computed by dividing the lower and upper limits of the ranges of the total development cost amounts by the corresponding number of rooms that were indicated by the respective franchisors in the UFOCs. These room counts were used by the respective franchisors as their basis for cost estimation. Some franchisors have opted to indicate a range of rooms instead of a specific room number. In these cases, we have divided both the lower and upper limits of the development cost ranges by the lower limits of the room ranges to derive the per-room ranges. This method resultsin more conservative computations that minimize the reflection of economies of scale. Finally, a midpoint figure, calculated from the summary per-room cost range data sourced from the UFOC documents, is given for each brand’s corresponding development cost within each category.The following table summarizes the total development cost ranges and corresponding midpoints, exclusive of land, for economy hotels.

Table 1: Summary of Total Hotel Development Cost Ranges (Excluding Land Cost) – Economy Hotels
 

Total Costs

Per room cost
Brand Rooms Lower Upper Midpoint Lower Upper Midpoint
Days Inn 100 $3,716,700 $5,709,000 $4,713,000 $37,000 $57,000 $47,000
Downtowner Inns/I&S 40 1,576,100 3,292,000 2,434,000 39,000 82,000 61,000
Econo Lodge/Econo Lodge I&S 69 1,929,719 3,089,204 2,509,000 28,000 45,000 37,000
GuestHouse** 70 2,758,660 4,790,487 3,775,000 39,000 68,000 54,000
Knights Inn 100 3,485,550 4,427,050 3,956,000 35,000 44,000 40,000
Master Hosts Inns/Master Hosts Resort 40 1,921,100 3,292,000 2,607,000 48,000 82,000 65,000
Microtel I&S 100 3,870,800 5,452,500 4,662,000 39,000 55,000 47,000
Microtel Suites 100 4,646,800 5,959,500 5,303,000 46,000 60,000 53,000
Motel 6** 63 2,488,500 3,091,650 2,790,000 40,000 49,000 45,000
Park Inn 70 2,094,720 4,987,720 3,541,000 30,000 71,000 51,000
Passport Inn/Passport I&S 40 1,256,100 2,792,000 2,024,000 31,000 70,000 51,000
Red Carpet Inn/I&S/Suites 40 1,576,100 3,292,000 2,434,000 39,000 82,000 61,000
Red Roof** 71 2,970,600 3,586,150 3,278,000 42,000 51,000 47,000
Rodeway Inn 75 2,050,335 3,341,304 2,696,000 27,000 45,000 36,000
Scottish Inns/I&S/Suites 40 1,256,100 2,792,000 2,024,000 31,000 70,000 51,000
Studio 6** 82 3,124,500 3,639,800 3,382,000 38,000 44,000 41,000
Suburban Extended Stay 100 3,723,271 5,263,047 4,493,000 37,000 53,000 45,000
Super 8 60 2,278,350 2,839,450 2,559,000 38,000 47,000 43,000
Travelodge 100 3,561,700 5,699,900 4,631,000 36,000 57,000 47,000
Vagabond Inn/Executive 100 3,896,300 6,995,200 5,446,000 39,000 70,000 55,000

*Unless noted, computation is based on 2006 data and is exclusive of land cost and other expenses not provided by franchisor. **Computation based on 2007 dataAs indicated in the preceding table, the room counts used by franchisors ofeconomy hotels for their basis in estimating total development cost, excluding land, range from 40 to 100 rooms. Expressed on a per-room basis, the total development cost, excluding land, for economy hotels range from$27,000 to $82,000, while the per-room midpoint calculations range from$36,000 to $65,000.The following table sets forth the total development cost ranges, exclusive of land, for mid-rate hotels.
Table 2: Summary of Total Hotel Development Cost Ranges (Excluding Land Cost) – Mid-Rate Hotels
 

Total Cost

Per room Cost
Brand
Rooms
Upper
Midpoint
Lower
Lower
Upper
Midpoint
AmericInn I&S 78 $5,262,714 $6,709,176 $5,986,000 $67,000 $86,000 $77,000
AmericInn Lodge and Suites/M&S 49 3,437,612 4,332,648 3,885,000 70,000 88,000 79,000
Baymont I&S 67 3,750,600 4,906,500 4,329,000 56,000 73,000 65,000
Candlewood Suites 122 6,580,000 8,808,000 7,694,000 54,000 72,000 63,000
Clarion 125 7,355,783 11,741,966 9,549,000 59,000 94,000 77,000
Clarion Suites 125 7,439,843 11,902,563 9,671,000 60,000 95,000 78,000
Comfort Inn/Comfort I&S 84 3,846,001 5,416,575 4,631,000 46,000 64,000 55,000
Comfort Suites 87 4,359,652 6,010,362 5,185,000 50,000 69,000 60,000
Country I&S 70 3,187,755 5,476,755 4,332,000 46,000 78,000 62,000
Fairfield Inn** 80 to 110 5,037,050 7,852,125 6,445,000 63,000 98,000 81,000
Fairfield I&S
     Room count range 80 to 110 5,420,050 8,269,400 6,845,000 68,000 103,000 86,000
     Room count range 120 to 150 7,689,800 10,909,500 9,300,000 64,000 91,000 78,000
Hampton Inn 81   4,875,154 7,633,651 6,254,000 60,000 94,000 77,000
Hampton I&S 102   6,419,565 10,598,715 8,509,000 63,000 104,000 84,000
Holiday Inn Express/I&S 80   4,923,775 6,971,135 5,947,000 62,000 87,000 75,000
Holiday Inn Resort 250   18,055,949 26,467,459 22,262,000 72,000 106,000 89,000
Holiday Inn/H&S 100   6,978,925 9,890,459 8,435,000 70,000 99,000 85,000
Howard Johnson 100   3,750,200 6,664,900 5,208,000 38,000 67,000 53,000
La Quinta Inn 100   4,478,300 6,098,400 5,288,000 45,000 61,000 53,000
La Quinta I&S 106   5,271,100 6,964,900 6,118,000 50,000 66,000 58,000
MainStay Suites 96   4,692,744 6,486,697 5,590,000 49,000 68,000 59,000
Quality Inn 100   3,926,440 6,192,175 5,059,000 39,000 62,000 51,000
Quality I&S 100   4,536,440 6,387,367 5,462,000 45,000 64,000 55,000
Quality Suites 100   4,923,572 6,937,321 5,930,000 49,000 69,000 59,000
Ramada 100   4,492,200 6,010,900 5,252,000 45,000 60,000 53,000
Ramada Plaza 150   8,617,470 10,086,020 9,352,000 57,000 67,000 62,000
Sleep Inn 80   3,558,001 4,950,839 4,254,000 44,000 62,000 53,000
Sleep I&S 80   3,467,606 4,895,444 4,182,000 43,000 61,000 52,000
TownePlace Suites 100 to 130   6,305,600 9,181,425 7,744,000 63,000 92,000 78,000
Wingate Inn 100   5,930,700 6,484,400 6,208,000 59,000 65,000 62,000

As indicated in the preceding table, the room counts used by franchisors ofmid-rate hotels for their basis in estimating total development cost, excluding land, range from 49 to 250 rooms. The total development cost, excluding land, for mid-rate hotels range from $38,000 to $106,000 per room, while the calculated midpoint range from $51,000 to $89,000 per room.The following table presents the total development cost ranges, exclusive of land, for first-class hotels.
Table 3: Summary of Total Hotel Development Cost Ranges (Excluding Land Cost) – First-Class Hotels
 

Total Cost

Per Room Cost
Brand
Rooms
Upper
Midpoint
Lower
Lower
Upper
Midpoint
aloft 136 $10,337,000 $21,428,000 $15,883,000 $76,000 $158,000 $117,000
Cambria Suites 129 8,525,252 11,772,178 10,149,000 66,000 91,000 79,000
Courtyard
     Room count range 80 to 110 6,441,900 10,373,525 8,408,000 81,000 130,000 106,000
     Room count range 120 to 150 9,251,700 13,751,125 11,501,000 77,000 115,000 96,000
Crowne Plaza 300 26,062,025 48,407,535 37,235,000 87,000 161,000 124,000
Crowne Plaza Resort 250 25,419,775 43,432,535 34,426,000 102,000 174,000 138,000
Crowne Plaza Suites 300 28,591,025 49,657,535 39,124,000 95,000 166,000 131,000
Doubletree 250 24,895,450 36,112,650 30,504,000 100,000 144,000 122,000
Doubletree Guest Suites 250 27,603,950 39,265,150 33,435,000 110,000 157,000 134,000
Element 123 12,360,000 24,755,000 18,558,000 100,000 201,000 151,000
Embassy Suites
     Room count range 145 18,116,603 23,812,684 20,965,000 125,000 164,000 145,000
     Room count range 156 18,769,403 24,615,484 21,692,000 120,000 158,000 139,000
     Room count range 250 25,431,123 42,718,810 34,075,000 102,000 171,000 137,000
Four Points 150 12,750,000 26,435,000 19,593,000 85,000 176,000 131,000
Hawthorn Suites 84 6,365,500 7,163,900 6,765,000 76,000 85,000 81,000
Hilton 300 33,811,133 57,457,974 45,635,000 113,000 192,000 153,000
Hilton Garden Inn 135 9,758,528 16,320,686 13,040,000 72,000 121,000 97,000
Homewood Suites 123 9,368,072 14,547,394 11,958,000 76,000 118,000 97,000
Hotel Indigo 140 10,237,500 14,927,500 12,583,000 73,000 107,000 90,000
Hyatt Place 127 11,081,500 12,100,000 11,591,000 87,000 95,000 91,000
Hyatt Summerfield Suites 125 12,336,000 13,895,000 13,116,000 99,000 111,000 105,000
JW Marriott 300 51,549,100 82,142,200 66,846,000 172,000 274,000 223,000
Le Meridien 250 25,730,000 73,165,000 49,448,000 103,000 293,000 198,000
Luxury Collection 250 46,235,000 93,970,000 70,103,000 185,000 376,000 281,000
Marriott 300 42,414,100 66,707,200 54,561,000 141,000 222,000 182,000
Renaissance 300 42,406,600 67,964,700 55,186,000 141,000 227,000 184,000
Residence Inn
     Room count range 80 to 110 8,062,050 12,590,625 10,326,000 101,000 157,000 129,000
     Room count range 80 to 110 5,996,725 9,536,750 7,767,000 75,000 119,000 97,000
     Room count range 120 to 150 8,475,275 12,488,400 10,482,000 71,000 104,000 88,000
Sheraton 250 25,750,000 61,280,000 43,505,000 103,000 245,000 174,000
Staybridge Suites 100 8,170,000 11,145,000 9,658,000 82,000 111,000 97,000
Westin 250 31,530,000 74,015,000 52,773,000 126,000 296,000 211,000
Wyndham 300 29,207,200 52,085,800 40,647,000 97,000 174,000 136,000

As indicated in the preceding table, the room counts used by franchisors offirst-class hotels for their basis in estimating total development cost, excluding land, ranged from 80 to 300 rooms. The total development cost, excluding land, range from $66,000 to $376,000 per room for first-class hotels, with corresponding calculated per-room midpoints ranging from $79,000 to$281,000.

Summary of Improvements Costs

Improvements include all buildings and other relatively permanentstructures located on, or attached to, a parcel. The cost of the improvements includes the cost of materials, fees, and labor to construct the hotel’s improvements. Tables 4, 5, and 6, which follow, summarize the various building construction cost ranges as reflected in the UFOCs of hotel brands that we analyzed. We note that some building cost ranges, as provided by UFOCs, may or may not reflect the cost to construct site improvements, as well as other costs typically associated with the construction of building and site improvements. The same methodology and assumptions applied to the per-room computation of total hotel development costs, as summarized above, were applied to the per-room computation of improvements costs. Similarly, the costs summarized below reflect the estimates applicable for new hotel construction and are not necessarily applicable to brand conversion scenarios. The following table summarizes the improvements cost ranges for economy hotels.

Table 4: Summary of Improvements Cost Ranges – Economy Hotels
 

Total Cost

Per Room Cost
Brand
Rooms
Upper
Midpoint
Lower
Lower
Upper
Midpoint
Days Inn 100 $2,750,000 $4,200,000 $3,475,000 $28,000 $42,000 $35,000
Downtowner Inns/I&S 40 675,000 1,500,000 1,088,000 17,000 38,000 28,000
Econo Lodge/Econo Lodge I&S 69 1,380,000 2,070,000 1,725,000 20,000 30,000 25,000
GuestHouse** 70 2,200,000 3,640,000 2,920,000 31,000 52,000 42,000
Knights Inn 100 2,600,000 3,200,000 2,900,000 26,000 32,000 29,000
Master Hosts Inns/Master Hosts Resort 40 1,000,000 1,500,000 1,250,000 25,000 38,000 32,000
Microtel I&S 100 3,000,000 4,200,000 3,600,000 30,000 42,000 36,000
Microtel Suites 100 3,600,000 4,600,000 4,100,000 36,000 46,000 41,000
Motel 6** 63 1,550,000 1,890,000 1,720,000 25,000 30,000 28,000
Park Inn 70 1,400,000 3,640,000 2,520,000 20,000 52,000 36,000
Passport Inn/Passport I&S 40 600,000 1,250,000 925,000 15,000 31,000 23,000
Red Carpet Inn/I&S/Suites 40 675,000 1,500,000 1,088,000 17,000 38,000 28,000
Red Roof** 71 1,917,000 2,270,000 2,094,000 27,000 32,000 30,000
Rodeway Inn 75 1,500,000 2,250,000 1,875,000 20,000 30,000 25,000
Scottish Inns/I&S/Suites 40 600,000 1,250,000 925,000 15,000 31,000 23,000
Studio 6** 82 2,000,000 2,225,000 2,113,000 24,000 27,000 26,000
Suburban Extended Stay 100 2,800,000 3,800,000 3,300,000 28,000 38,000 33,000
Super 8 60 1,620,000 1,920,000 1,770,000 27,000 32,000 30,000
Travelodge 100 2,650,000 4,200,000 3,425,000 27,000 42,000 35,000
Vagabond Inn/Executive 100 3,000,000 5,000,000 4,000,000 30,000 50,000 40,000

As indicated in the preceding table, the room counts used by franchisors ofeconomy hotels for their basis in estimating improvements cost ranged from40 to 100 rooms. Expressed on a per-room basis, the improvements cost for economy hotels range from $15,000 to $52,000. The corresponding midpointsof these ranges vary from a low of $23,000 per room to a high of $42,000 per room.The following table outlines the improvements cost ranges for mid-rate hotels.

Table 5 Improvements Cost for Economy Hotels
   

Total Cost

Per room Cost
Brand
Rooms
Lower
Upper
Midpoint
Lower
Upper
Midpoint
AmericInn I&S 78 $4,446,000 $5,616,000 $5,031,000 $57,000 $72,000 $65,000
AmericInn M&S 49 2,891,000 3,626,000 3,259,000 59,000 74,000 67,000
Baymont I&S 67 2,800,000 3,600,000 3,200,000 42,000 54,000 48,000
Candlewood Suites 122 5,323,000 6,500,000 5,912,000 44,000 53,000 49,000
Clarion 125 5,625,000 8,750,000 7,188,000 45,000 70,000 58,000
Clarion Suites 125 5,625,000 8,750,000 7,188,000 45,000 70,000 58,000
Comfort Inn/Comfort I&S 84 2,940,000 3,780,000 3,360,000 35,000 45,000 40,000
Comfort Suites 87 3,480,000 4,350,000 3,915,000 40,000 50,000 45,000
Country I&S 70 2,310,000 3,920,000 3,115,000 33,000 56,000 45,000
     Room count 80 to 110 3,840,000 4,400,000 4,120,000 48,000 55,000 52,000
     Room count 120 to 150 5,640,000 6,480,000 6,060,000 47,000 54,000 51,000
Hampton Inn 81 3,500,000 5,000,000 4,250,000 43,000 62,000 53,000
Hampton I&S 102 4,600,000 7,200,000 5,900,000 45,000 71,000 58,000
Holiday Inn Express/I&S 80 3,800,000 5,080,000 4,440,000 48,000 64,000 56,000
Holiday Inn Resort 250 15,150,000 20,885,000 18,018,000 61,000 84,000 73,000
Holiday Inn/H&S 100 5,300,000 7,200,000 6,250,000 53,000 72,000 63,000
Howard Johnson 100 2,800,000 5,000,000 3,900,000 28,000 50,000 39,000
La Quinta Inn 100 3,320,000 4,500,000 3,910,000 33,000 45,000 39,000
La Quinta I&S 106 4,006,800 5,237,500 4,622,000 38,000 49,000 44,000
MainStay Suites 96 3,648,000 4,608,000 4,128,000 38,000 48,000 43,000
Quality Inn 100 3,000,000 4,500,000 3,750,000 30,000 45,000 38,000
Quality I&S 100 3,500,000 4,500,000 4,000,000 35,000 45,000 40,000
Quality Suites 100 3,500,000 5,000,000 4,250,000 35,000 50,000 43,000
Ramada 100 3,400,000 4,500,000 3,950,000 34,000 45,000 40,000
Ramada Plaza 150 6,500,000 7,500,000 7,000,000 43,000 50,000 47,000
Sleep Inn 80 2,800,000 3,600,000 3,200,000 35,000 45,000 40,000
Sleep I&S 80 2,640,000 3,440,000 3,040,000 33,000 43,000 38,000
TownePlace Suites 100 to 130 4,300,000 4,900,000   4,600,000     43,000 49,000     46,000
Wingate Inn     100   4,550,000  4,850,000  4,700,000    46,000  49,000     48,000

The preceding table shows that the room counts used by franchisors of mid-rate hotels for their basis in estimating improvements cost range from 49 to250 rooms. The improvements cost for mid-rate hotels range from $28,000 to$84,000 per room, while the calculated midpoints of these per-room development cost ranges vary from $38,000 to $73,000.The following table presents the improvements cost ranges for first-class hotels.   
    
Table 6: Summary of Improvements Cost Ranges – First-Class Hotels
 

Total Cost

Per Room Cost
Brand
Rooms
Lower
Upper
Midpoint
Lower
Upper
Midpoint
aloft 136 $7,000,000 $14,000,000 $10,500,000 $51,000 $103,000 $77,000
Cambria Suites 129 6,450,000 8,385,000 7,418,000 50,000 65,000 58,000
Courtyard
     Room count range 80 to 110 4,320,000 5,200,000 4,760,000 54,000 65,000 60,000
     Room count range 120 to 150 6,360,000 7,680,000 7,020,000 53,000 64,000 59,000
Crowne Plaza 300 21,325,000 39,750,000 30,538,000 71,000 133,000 102,000
Crowne Plaza Resort 250 20,728,750 35,000,000 27,864,000 83,000 140,000 112,000
Crowne Plaza Suites 300 23,750,000 41,000,000 32,375,000 79,000 137,000 108,000
Doubletree 250 17,500,000 25,000,000 21,250,000 70,000 100,000 85,000
Doubletree Guest Suites 250 20,000,000 27,500,000 23,750,000 80,000 110,000 95,000
Element 123 9,000,000 17,000,000 13,000,000 73,000 138,000 106,000
Embassy Suites
     Room count 145 11,600,000 14,500,000 13,050,000 80,000 100,000 90,000
     Room count 156 12,000,000 15,000,000 13,500,000 77,000 96,000 87,000
     Room count 250 18,000,000 30,000,000 24,000,000 72,000 120,000 96,000
Four Points 150 9,000,000 20,000,000 14,500,000 60,000 133,000 97,000
Hawthorn Suites 84 4,848,500 5,221,400 5,035,000 58,000 62,000 60,000
Hilton 300 24,000,000 42,000,000 33,000,000 80,000 140,000 110,000
Hilton Garden Inn 135 7,000,000 12,000,000 9,500,000 52,000 89,000 71,000
Homewood Suites 123 6,800,000 10,150,000 8,475,000 55,000 83,000 69,000
Hotel Indigo 140 7,900,000 11,200,000 9,550,000 56,000 80,000 68,000
Hyatt Place 127 6,850,000 7,100,000 6,975,000 54,000 56,000 55,000
Hyatt Summerfield Suites 125 7,850,000 8,100,000 7,975,000 63,000 65,000 64,000
JW Marriott 300 35,700,000 61,500,000 48,600,000 119,000 205,000 162,000
Le Meridien 250 19,300,000 60,000,000 39,650,000 77,000 240,000 159,000
Luxury Collection 250 36,250,000 75,000,000 55,625,000 145,000 300,000 223,000
Marriott 300 28,500,000 48,300,000 38,400,000 95,000 161,000 128,000
Renaissance 300 28,500,000 49,500,000 39,000,000 95,000 165,000 130,000
Residence Inn
     Room count 80 to 110 5,600,000 6,400,000 6,000,000 70,000 80,000 75,000
     Room count 120 to 150 8,280,000 9,480,000 8,880,000 69,000 79,000 74,000
Sheraton      250   19,300,000 48,300,000   33,800,000  77,000  193,000  135,000
SpringHill Suites              
     Room count 80 to 110 4,160,000 4,880,000 4,520,000 52,000 61,000 57,000
     Room count 120 to 150 6,000,000 7,080,000 6,540,000 50,000 59,000 55,000
Staybridge Suites 100 6,500,000 8,040,000 7,270,000 65,000 80,000 73,000
Westin 250 24,000,000 60,000,000 42,000,000 96,000 240,000 168,000
Wyndham 300 21,750,000 39,450,000 30,600,000 72,500 131,500 102,000

As indicated in the preceding table, the room counts used by franchisors offirst-class hotels for their basis in estimating improvements cost range from80 to 300 rooms. Improvements cost range from $50,000 to $300,000 per room for first-class hotels, and the calculated midpoints of the per-room cost ranges varies from $55,000 to $223,000.

Summary of Furniture,Fixtures, and Equipment Costs

Furniture, fixtures, and equipment (FF&E) include all non-permanent,removable items at a hotel, such as guestroom furnishings, kitchen equipment, and items of decor. The cost of the FF&E, and all the fees associated with installing and furnishing the items in a hotel, constitute the total cost of the furniture, fixtures, and equipment. Tables 7, 8, and 9, which follow, summarize the various FF&E cost ranges as reflected in the UFOCs of hotel brands that we analyzed. We note that some FF&E cost range estimates may or may not reflect all the various types of FF&E, as well as some costs that are typically associated with installing and furnishing the FF&E items. This is attributable to the fact that FF&E is not standard from brand to brand, and certain brands choose to outsource laundry or kitchen operations, for example, and therefore do not include such equipment in their FF&E cost estimates. The same methodology and assumptions applied to the per-room computation of total hotel development costs, as summarized above, were applied to the per-room computation of FF&E costs. Similarly, the costs summarized below reflect the estimates applicable for new hotel construction and are not necessarily applicable to brand conversion scenarios.The following table summarizes the FF&E cost ranges for economy hotels.

Table 7: Summary of FF&E Cost Ranges – Economy Hotels

Total Cost

Per Room Cost
Brand Rooms Lower Upper Midpoint Lower Upper Midpoint
Days Inn 100 $440,000 $675,000 $558,000 $4,000 $7,000 $6,000
Downtowner Inns/I&S 40 500,000 700,000 600,000 13,000 18,000 16,000
Econo Lodge/Econo Lodge I&S 69 207,000 276,000 242,000 3,000 4,000 4,000
GuestHouse** 70 200,000 546,000 373,000 3,000 8,000 6,000
Knights Inn 100 425,000 500,000 463,000 4,000 5,000 5,000
Master Hosts Inns/Master Hosts Resort 40 400,000 700,000 550,000 10,000 18,000 14,000
Microtel I&S 100 438,000 529,000 484,000 4,000 5,000 5,000
Microtel Suites 100 619,000 645,000 632,000 6,000 6,000 6,000
Motel 6** 63 420,000 520,000 470,000 7,000 8,000 8,000
Park Inn 70 280,000 560,000 420,000 4,000 8,000 6,000
Passport Inn/Passport I&S 40 265,000 500,000 383,000 7,000 13,000 10,000
Red Carpet Inn/I&S/Suites 40 500,000 700,000 600,000 13,000 18,000 16,000
Red Roof** 71 475,000 550,000 513,000 7,000 8,000 8,000
Rodeway Inn 75 225,000 300,000 263,000 3,000 4,000 4,000
Scottish Inns/I&S/Suites 40 265,000 500,000 383,000 7,000 13,000 10,000
Studio 6** 82 525,000 650,000 588,000 6,000 8,000 7,000
Suburban Extended Stay 100 400,000 400,000 400,000 4,000 4,000 4,000
Super 8 60 260,000 305,000 283,000 4,000 5,000 5,000
Travelodge 100 425,000 675,000 550,000 4,000 7,000 6,000
Vagabond Inn/Executive 100 700,000 1,600,000 1,150,000 7,000 16,000 12,000

This table illustrates that the room counts used by franchisors of economy hotels for their basis in estimating FF&E cost range from 40 to 100 rooms. Expressed on a per-room basis, the FF&E cost for economy hotels range from$3,000 to $18,000, with a midpoint range of $4,000 to $16,000.The following table sets forth the FF&E cost ranges for mid-rate hotels.

Table 8 FF&E Cost for Economy Hotels
 

Cost

Per Room Cost
Brand Rooms Lower Upper Midpoint Lower Upper Midpoint
AmericInn I&S 78 $546,000 $702,000 $624,000 $7,000 $9,000 $8,000
AmericInn Lodge and Suites/M&S 49 343,000 392,000 368,000 7,000 8,000 8,000
Baymont I&S 67 440,000 540,000 490,000 7,000 8,000 8,000
Candlewood Suites 122 800,000 925,000 863,000 7,000 8,000 8,000
Clarion 125 1,000,000 1,250,000 1,125,000 8,000 10,000 9,000
Clarion Suites 125 1,000,000 1,250,000 1,125,000 8,000 10,000 9,000
Comfort Inn/Comfort I&S 84 420,000 588,000 504,000 5,000 7,000 6,000
Comfort Suites 87 435,000 696,000 566,000 5,000 8,000 7,000
Country I&S 70 420,000 700,000 560,000 6,000 10,000 8,000
Fairfield Inn** 80 to 110 480,000  480,000      480,000    6,000    6,000   6,000
Fairfield I&S
     Room count range 80 to 110 480,000 560,000 520,000 6,000 7,000 7,000
     Room count range 120 to 150 720,000 840,000 780,000 6,000 7,000 7,000
Hampton Inn 81 600,000 900,000 750,000 7,000 11,000 9,000
Hampton I&S 102 800,000 1,200,000 1,000,000 8,000 12,000 10,000
Holiday Inn Express/I&S 80 650,000 900,000 775,000 8,000 11,000 10,000
Holiday Inn Resort 250 2,000,000 4,000,000 3,000,000 8,000 16,000 12,000
Holiday Inn/H&S 100 1,100,000 1,550,000 1,325,000 11,000 16,000 14,000
Howard Johnson 100 450,000 800,000 625,000 5,000 8,000 7,000
La Quinta Inn 100 500,000 755,600 628,000 5,000 8,000 7,000
La Quinta I&S 106 583,000 755,600 669,000 6,000 7,000 7,000
MainStay Suites 96 480,000 672,000 576,000 5,000 7,000 6,000
Quality Inn 100 400,000 500,000 450,000 4,000 5,000 5,000
Quality I&S 100 500,000 600,000 550,000 5,000 6,000 6,000
Quality Suites 100 500,000 600,000 550,000 5,000 6,000 6,000
Ramada 100 545,000 700,000 623,000 5,000 7,000 6,000
Ramada Plaza 150 1,300,000 1,500,000 1,400,000 9,000 10,000 10,000
Sleep Inn 80 320,000 400,000 360,000 4,000 5,000 5,000
Sleep I&S 80 400,000 480,000 440,000 5,000 6,000 6,000
TownePlace Suites 100 to 130 600,000    700,000   650,000       6,000 7,000   7,000  
Wingate Inn   100   725,000     775,000    750,000       8,000     ,000     8,000  

As indicated in the preceding table, the room counts used by franchisors ofmid-rate hotels for their basis in estimating FF&E cost range from 49 to 250 rooms. The FF&E cost for mid-rate hotels range from $4,000 to $16,000 per room, and the per-room calculated midpoints range from $5,000 to $14,000.The following table outlines the FF&E cost ranges for first-class hotels.

Table 9 FF&E cost for mid-rate hotels
 

Total Cost

Per Room Cost
Brand
Rooms
Lower
Upper
Midpoint
Lower
Upper
Midpoint
aloft 136 $1,750,000 $3,750,000 $2,750,000 $13,000 $28,000 $21,000
Cambria Suites 129 1,161,000 1,548,000 1,355,000 9,000 12,000 11,000
Courtyard
    Room count 80 to 110 712,000 832,000 772,000 8,900 10,400 10,000
     Room count 120 to 150 1,068,000 1,248,000 1,158,000 8,900 10,400 10,000
Crowne Plaza 300 3,000,000 5,500,000 4,250,000 10,000 18,000 14,000
Crowne Plaza Resort 250 3,000,000 5,850,000 4,425,000 12,000 23,000 18,000
Crowne Plaza Suites 300 3,000,000 5,500,000 4,250,000 10,000 18,000 14,000
Doubletree 250 4,500,000 6,000,000 5,250,000 18,000 24,000 21,000
Doubletree Guest Suites 250 5,000,000 7,000,000 6,000,000 20,000 28,000 24,000
Element 123 1,750,000 4,000,000 2,875,000 14,000 33,000 24,000
Embassy Suites
Room count 145 3,300,000 4,500,000 3,900,000 23,000 31,000 27,000
Room count 156 3,550,000 4,800,000 4,175,000 23,000 31,000 27,000
Room count 250 5,000,000 7,500,000 6,250,000 20,000 30,000 25,000
Four Points 150 2,250,000 3,750,000 3,000,000 15,000 25,000 20,000
Hawthorn Suites 84 887,000 942,500 915,000 11,000 11,000 11,000
Hilton 300 6,000,000 8,000,000 7,000,000 20,000 27,000 24,000
Hilton Garden Inn 135 1,500,000 2,000,000 1,750,000 11,000 15,000 13,000
Homewood Suites 123 1,400,000 1,800,000 1,600,000 11,000 15,000 13,000
Hotel Indigo 140 1,250,000 1,850,000 1,550,000 9,000 13,000 11,000
Hyatt Place 127 2,900,000 3,100,000 3,000,000 23,000 24,000 24,000
Hyatt Summerfield Suites 125 2,930,000 3,380,000 3,155,000 23,000 27,000 25,000
JW Marriott 300 6,000,000 7,200,000 6,600,000 20,000 24,000 22,000
Le Meridien 250 4,500,000 8,750,000 6,625,000 18,000 35,000 27,000
Luxury Collection 250 7,500,000 15,000,000 11,250,000 30,000 60,000 45,000
Marriott 300 4,500,000 5,700,000 5,100,000 15,000 19,000 17,000
Renaissance 300 4,500,000 5,700,000 5,100,000 15,000 19,000 17,000
Residence Inn
     Room count range 80 to 110 880,000 1,080,000 980,000 11,000 13,500 12,000
     Room count range 120 to 150 1,320,000 1,620,000 1,470,000 11,000 13,500 12,000
Sheraton   250  4,500,000   8,750,000  6,625,000    18,000   35,000     27,000
SpringHill Suites              
Room count range 80 to 110 656,000 760,000 708,000 8,200 9,500 9,000
Room count range 120 to 150 972,000 1,128,000 1,050,000 8,100 9,400 9,000
Staybridge Suites 100 1,225,000 1,650,000 1,438,000 12,000 17,000 15,000
Westin 250 5,500,000 10,000,000 7,750,000 22,000 40,000 31,000
Wyndham 300 4,050,000 7,950,000 6,000,000 13,500 26,500 20,000

As indicated in the preceding table, the room counts used by franchisors of first-class hotels for their basis in estimating FF&E cost range from 80 to 300 rooms. FF&E cost range from $8,100 to $60,000 per room for first-class hotels, and corresponding per-room midpoints range from $9,000 to $45,000.

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Posted on July 4, 2007 10:12 PM |
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