2019 Franchise Disclosure Document Updates
U.S. Only | We have completed our annual updates to Marriott’s Franchise Disclosure Documents (FDDs) and wish to highlight certain system changes that may impact your hotel(s). These changes are effective for all new development and relicensing deals as of March 31, 2019.
NEW DEVELOPMENT INCENTIVES
We are pleased to announce the following new development incentive programs:
Delta Hotels: We are offering the following discount off our standard franchise fees to eligible new-to-system Delta Hotels projects (including conversions of non-Marriott brand hotels to Delta Hotels) approved by our Hotel Development Committee after March 31, 2019:
|
Year |
Franchise Fee |
|
1 |
2% of gross room sales |
|
2 |
2% of gross room sales |
|
3 |
3% of gross room sales |
|
4 |
4% of gross room sales |
|
5 and thereafter |
5% of gross room sales |
Modular Construction Development Incentive for Certain Marriott Select Brands: New-to-system Courtyard by Marriott, Fairfield by Marriott, Springhill Suites by Marriott, and TownePlace Suites by Marriott hotel projects are eligible to receive a modular construction development incentive of up to $250,000. In order to qualify you must: (1) retain a manufacturer approved by us to construct each hotel guestroom (including the guestroom furniture and fixtures) in accordance with our modular prototype, (2) purchase the hotel furniture, fixtures, equipment, and hotel opening operating supplies we specify from Marriott’s global design procurement division; (3) the application for the project must be approved by our hotel development committee between March 31, 2019 and March 31, 2020, and (4) the construction of the hotel must commence within 15 months of the date of approval and the hotel must open as a brand hotel within 13 months of the date of such construction commencement.
FOUR POINTS REVISED DEVELOPMENT INCENTIVE
We offer new construction and conversion development incentive programs to eligible Four Points hotels development projects approved by our hotel development committee after March 31, 2019.
If your qualified project is for the construction of a new hotel, the franchise fee as a percentage of gross room revenue for each year after the hotel opens for business as a Four Points hotel will be as follows:
|
Year |
Franchise Fee |
|
1 |
2% |
|
2 |
2% |
|
3 |
3% |
|
4 |
3% |
|
5 and thereafter |
5.5% |
In addition, we will offer $1,000/room in key money for new build Four Points hotels, up to $250,000. If your qualified project is a conversion of an existing hotel that is not a Marriott brand hotel, the franchise fee as a percentage of gross room sales for each year after the hotel opens for business as a Four Points hotel is:
|
Year |
Franchise Fee |
|
1 |
3% |
|
2 |
3% |
|
3 |
4% |
|
4 and thereafter |
5.5% |
PHASE-OUT OF DESIGN AND CONSTRUCTION REVIEW SERVICES FEES
We have phased-out the $50,000 design and construction review services fee for all full-service projects approved by our hotel development committee after March 31, 2019. We have also phased out the $5,000 to $50,000 design and construction review services fees for modified prototype and custom-build MSB projects approved by our hotel development committee after March 31, 2019.
APPLICATION FEE ADJUSTMENTS
For the first time in many years, Marriott has adjusted applications fee for all new-to-system full-service projects. The application fee is $100,000 plus $400 per room in excess of $250 rooms for all new-to-system full service hotel projects approved by our hotel development committee after March 31, 2019.
Similarly, the application fees for Marriott Select Brands (MSB) approved by our hotel development committee after March 31, 2019 have been adjusted to the following:
|
BRAND |
APPLICATION FEE |
BRAND |
APPLICATION FEE |
|
AC Hotels by Marriott |
$90,000 + $500 / room in excess of 150 rooms |
Four Points |
$75,000 + $400 / room in excess of 150 rooms |
|
Aloft |
$75,000 + $500 / room in excess of 150 rooms |
Moxy |
$90,000 + $500 / room in excess of 150 rooms |
|
Courtyard |
$90,000 + $500 / room in excess of 150 rooms |
Residence Inn |
$90,000 + $500 / room in excess of 150 rooms
|
|
Element |
$75,000 + $500 / room in excess of 150 rooms |
Springhill Suites |
$75,000 + $400 / room in excess of 150 rooms
|
|
Fairfield |
$75,000 + $400 / room in excess of 125 rooms |
TownePlace Suites |
$75,000 + $400 / room in excess of 125 rooms
|
FITM, FOND & BSA GSS
Franchisee Introduction to Marriott (FITM), Franchisee Onboarding for New Development (FOND) and BSA GSS have been extended to full-service hotels. Additionally, the Executive Excellence team has created similar programs for conversions and relicensings: FITM, Franchisee Introduction to Marriott Program for Relicensings (FITM-R) and Above-Property Immersion Program (API).
PROGRAM SERVICES FUND (PSF) ADJUSTMENTS FOR LE MÉRIDIEN, SHERATON, AND THE LUXURY COLLECTION
Commencing in January 2020, the PSF for Le Méridien, The Luxury Collection, and Sheraton will cover the cost of Group Production (a legacy Starwood group sales program), and the PSF charges for these brands will increase proportionately to reflect the addition of a new service, as described below.
|
Brand |
Until December 31, 2019 |
Effective January 1, 2020 |
|
Le Méridien |
2.259% of gross room sales (which includes contribution to the Marketing Fund of 1%); plus
$50,000 per year; plus
$510 per guestroom per year. |
2.42% of gross room sales (which includes a contribution to the Marketing Fund of 1% of gross room sales); plus
$50,000 per year; plus
$510 per guestroom per year. |
|
The Luxury Collection |
2.159% of gross room sales (which includes a contribution to the Marketing Fund of 1% of gross room sales; plus
$40,000 per year; plus
$450 per guestroom per year.
|
2.32% of gross room sales (which includes a contribution to the Marketing Fund of 1% of gross room sales); plus
$40,000 per year; plus
$450 per guestroom per year. |
|
Sheraton |
2.259% of gross room sales (which includes contribution to the Marketing Fund of 1% of gross room sales); plus
$50,000 per year; plus
$510 per guestroom per year.
|
2.42% of gross room sales (which includes a contribution to the Marketing Fund of 1% of gross room sales); plus
$50,000 per year; plus
$510 per guestroom per year. |
CUSTOMER ENGAGEMENT CENTER PROPERTY SUPPORT SERVICES (CEC PSS)
We are adjusting the cost of the optional CEC PSS program to to reflect current market labor rate. The cost will be trued-up to hotels at year-end 2019. The cost, which will be trued-up to hotels at year-end, is anticipated to be as follows:
|
Brand |
Estimated cost |
|
AC Hotels, Aloft, Fairfield, MOXY, SpringHill Suites |
Fee estimated to range from $5.35 to $5.90 per guestroom reserved
$28.00 to $30.00 per hour for other PSS, subject to true-ups as set forth in your CEC PSS agreement |
|
Courtyard, Element, Four Points, TownePlace Suites |
Fee estimated to range from $5.75 to $6.35 per guestroom reserved, plus
$28.00 to $30.00 per hour for other PSS, subject to true-ups as set forth in your CEC PSS agreement
|
|
Residence Inn |
Fee estimated to range from $6.75 to $7.45 per guestroom reserved, plus
$28.00 to $30.00 per hour for other PSS, subject to true-ups as set forth in your CEC PSS agreement |
|
Marriott Hotels, Renaissance, Westin |
Fee estimated to range from $6.75 to $7.45 per guestroom reserved for non-resort hotels, plus
$7.40 to $8.15 per guestroom reserved for resort hotels; $10.10 to $11.10 per guestroom reserved for resort hotels requesting enhanced services from a specialized resort team, plus
$28.00 to $30.00 per hour for other PSS, subject to true-ups as set forth in your CEC PSS agreement |
|
Tribute Portfolio, Sheraton |
Fee estimated to range from $6.75 to $7.45 per guestroom reserved for non-resort hotels, plus
$7.40 to $8.15 per guestroom reserved for resort hotels; $10.10 to $11.10 per guestroom reserved for resort hotels requesting enhanced services from a specialized resort team, plus
$28.00 to $30.00 per hour for other PSS, subject to true-ups as set forth in your CEC PSS agreement |
|
Autograph Collection, Delta Hotels, Le Meridien |
Fee estimated to range from $6.75 to $7.45 per guestroom reserved for non-resort hotels, plus
$28.00 to $30.00 per hour for other PSS, subject to true-ups as set forth in your CEC PSS agreement |
|
The Luxury Collection |
Fee estimated to range from $3.75 to $4.15 per call, plus
$28.00 to $30.00 per hour for other PSS, subject to true-ups as set forth in your CEC PSS agreement |
Also, effective April 1, 2019, the CEC will forward guest relation cases received at the CEC to the properties for resolution. If cases sent to properties are not resolved within 72 hours, the CEC will take over the case and hotels will be charged a $150 USD takeover charge. The CEC will also charge hotels for any guest compensation awarded to guests related to property service issues. This change was previously communicated to hotels and resources, including job aids, have been provided.
GUEST SATISFACTION SURVEY (GSS) DATA MANIPULATION
Manipulation of GSS data is prohibited, and Marriott will charge a fee of up to $5,000 per calendar quarter should you interfere with this data in any way. For prior communication on GSS data manipulation, click here.
AC AND MOXY BRAND IMMERSIONS
AC Hotels and Moxy have new brand immersion training programs which are designed to immerse executive-level (above-property) leaders to Marriott’s Distinctive brand standards, programs and initiatives. These required programs range from $2,000 to $10,000.
We thank you for your continued support as we remain committed to protecting your investments while continuing to improve each brand’s economic business model.
