Ed Brock is an award-winning journalist who has worked for various U.S. newspapers and magazines, including with American City & County magazine, a national publication based in Atlanta focused on city and county government issues. He is currently assistant editor at Asian Hospitality magazine, the top U.S. publication for Asian American hoteliers.
Originally from Mobile, Alabama, Ed began his career in journalism in the early 1990s as a reporter for a chain of weekly newspapers in Baldwin County, Alabama. After a stint teaching English in Japan, Ed returned to the U.S. and moved to the Atlanta area where he returned to journalism, coming to work at Asian Hospitality in 2016.
IN TIMES OF trouble, everybody needs a helping hand. In the throes of the COVID-19 pandemic, hard-hit hotel owners are turning to their franchisers for assistance, and they have received it, in various forms.
But some companies are doing more than others, according to some owners who think more companies should waive certain franchise fees. Others say franchisees and franchisers are all in the same boat and now is not the time to worry about much more than taking care of guests and employees.
The help offered to franchisees varied from company to company, but most offered to suspend enforcement of some brand standards and to postpone PIPs. Some, not all, waived or deferred certain franchise fees.
Best Western Hotels & Resorts waived half of all monthly fees, half of property revenue management fees and delayed certain fees until November. The company’s board of directors and executives voluntarily reduced their compensation by 20 percent.
“The impact of this global pandemic has been devastating to the livelihood of our hoteliers, their families, and the employees who depend on them,” said David Kong, Best Western president and CEO, in a statement. “At Best Western, we are truly a family that stands together, shoulder to shoulder, during a time of crisis. In coming together, not only will Best Western weather this storm, but our nation and industry will emerge stronger than ever.”
Fixing the fixed fees
Best Western’s relief package is one of the best, said Maulesh Patel, a Comfort Inn owner in Tom’s River, New Jersey.
“Best Western is leading the pack since they are a member focused association,” Maulesh said. “Other brands, they are offering deferment, they’re not reducing any of the fixed fees.”
Maulesh is a charter member of the Fair Franchising Initiative, a group of hotel owners formed at a March 5 meeting in Edison, New Jersey with the intention of promoting better franchising practices in the hospitality industry. His position now is that all fixed fees should be waived during the current crisis.
“Since there’s no revenue, those fees are not justified,” he said. “Percentage fees are but fixed fees are not justified.”
Maulesh said large hotel companies should be prepared to waive the fees when occupancy drops as low as it is now.
“Every franchiser, when they underwrite a franchise agreement, they know that, when the occupancy is less than 40 or 50 percent, none of the franchisees will even have money to pay the franchise fees. That’s normal due diligence,” he said. “Now the occupancies are in single digits. Franchisees are expected to pay their employees and keep their doors open from money out of their pockets in this crisis. Is it fair for the franchisers to ask for those fixed fees, which basically is adding to the shareholders’ value.”
He also said that it would be a violation of terms to use money from the Coronavirus Aid, Relief & Economic Security, or CARES, Act that is expected to be approved by the House of Representatives on Friday, to pay the fees.
“Many of our hotel owners will be getting [Small Business Administration] loans, which is money coming from the government,” Maulesh said. “Is that money supposed to be used for the employees or should it be going towards those fixed fees? Actually, the SBA should put a provision that those loans cannot be used to pay toward franchise fees or fixed fees, because that’s basically an indirect bailout of shareholders.”
It’s in the hotel companies’ and the industry’s best interest to focus on the needs of the franchisees at this time, Maulesh said.
“Every franchise company has to realize that the biggest stakeholder in this industry is the franchisee. They invest millions of dollars to create the shareholder value. In the long term, by not looking after the franchisees, it will be eroding the shareholders’ value further,” he said.
A common crisis
Ritesh Patel, president of RAM Hotels in Columbus, Georgia, has a somewhat different view of the brands’ response to the crisis. His company owns primarily brands from InterContinental Hotel Group, Hilton and Marriott International.
“This is a common crisis that we’re all facing and it’s all so sudden. We’ve never seen occupancy diminish so significantly so rapidly,” Ritesh said. “I think it’s touching and impacting indiscriminately franchisees as well as franchisors.”
Ritesh’s company includes a management section with a staff of 19 that is labor heavy, a fact he said is shared by most large franchisors. Most hotel owners have a furlough process to control variable costs from labor, but management companies and brands don’t have that option, he said.
“When [a hotel management company] really needs to step up is in times like this. If you’re furloughing people at the hotel level, then who’s going to come and guide them and who’s going to make sure if there’s nobody there how you properly close the hotels, how you start the process?” he said. “I think the brand is no different from a hotel management company and they’re hurting even more than hotel owners in this.”
While some of the brands in his portfolio may not be waiving fees, Ritesh said they are helping in other ways.
“They’re coming right out and saying ‘Hey, you have flexibility on your brand standards if there are variable costs that you feel like you’re not going to be needing right now feel free to eliminate it,’” Patel said. “Some brands are going further and sending checklists on how you should be doing your partial closures, this is how you should be doing your complete closures.”
Those checklists can save owners a lot of time and money, he said.
“Nobody wants to close a hotel, let’s face it. But, to close a hotel properly, we’ve never done that,” he said. “Being in the industry for nearly 20 years we’ve never closed any of our properties because a natural disaster like a hurricane. There are a lot of folks that this is very new to.”
And some companies are waiving revenue management fees.
“There hasn’t been any announcement from Hilton or Marriott or IHG on the royalty side of it or the marketing fees, which makes up the bulk of the fees,” he said. “But, again, I completely understand that because if you really look at it, they’re not really earning any fees to give away any fees. If you’re running a hotel that’s at 10 or 15 percent occupancy they’re barely generating any revenue.”
Once the outbreak has passed, he said, and occupancy rises above 55 percent again, the issue of fees may be addressed.
“At that point, perhaps, the dialog should change,” Ritesh said.
Below are the measures some hotel companies are taking to help their franchisees:
Best Western Hotels & Resorts
Waiving half on monthly fees and property revenue management fees.
Reducing Best Western Rewards loyalty point fees charged to members by one-half without lowering points awarded to loyalty program participants.
Increasing by 50 percent hotel redemption compensation for Best Western loyalty guest stays.
Waiving in entirety Best Western co-op marketing fees.
Wyndham Hotels and Resorts
All fees accruing for the months of March, April and May can be deferred, interest-free, until Sept. 1, 2020.
Reducing SynXis PMS Fee 50 percent for April and May.
Removal of revenue management service, MOP and loyalty retraining fees for April and May.
Extending deferral of all brand standards, except for health and safety, and property improvement plan items until Jan. 1, 2021.
Waiving quality assurance and Wyndham Quality Circle inspections and fees for March, April and May.
InterContinental Hotels Group:
Providing owners with brand-specific guidance related to operational changes and relaxed brand standards in place through the end of June 2020.
“This guidance, largely, places public health and safety first for our colleagues and guests, and covers multiple areas including colleague trainings, recreational areas, food and beverage options, and in-room services.”
Choice Hotels International
Suspending a variety of fees, including on past due balances since March 1, 2020, reputation management fees and guest relations handling fees.
Assisting franchisees in managing guest reservations and cancellations.
Pausing quality assurance reviews through June 30, 2020, and pausing Property Improvement Plan inspections through Dec. 31, 2020.
Suspending certain brand standards, creating more flexible options, and moving deadlines to reflect the evolving travel environment.
Providing guidance and best practices on crisis preparedness, including specific prevention procedures, proper disinfection protocols, etc.
Choice Hotels International reported Q2 net income of $81.7 million.
Domestic RevPAR fell 2.9 percent due to macroeconomic conditions.
Extended-stay portfolio rose 10.5 percent YoY, with a domestic pipeline of 43,000 rooms.
CHOICE HOTELS INTERNATIONAL reported second-quarter net income of $81.7 million, down from $87.1 million a year earlier. Its forecast for the year remained positive, but was downgraded some to account for changes in macroeconomic conditions.
The company’s global pipeline exceeded 93,000 rooms, including nearly 77,000 in the U.S. Its global system size grew 2.1 percent, including 3 percent growth in the upscale, extended-stay and midscale segments, Choice said in a statement.
“Choice Hotels delivered another quarter of record financial performance despite a softer domestic RevPAR environment, underscoring the successful execution and diversification of our growth strategy,” said Patrick Pacious, president and CEO. “We are especially pleased with our strong international performance, where we have achieved significant growth and accelerated global expansion through a recent strategic acquisition, the signing of key partnerships, and entry into new markets. With more diversified growth avenues, enhanced product quality and value proposition driving stronger customer engagement and a leading position in the cycle-resilient extended-stay segment, we remain well-positioned to deliver long-term returns for all our stakeholders.”
Domestic RevPAR declined 2.9 percent, reflecting macroeconomic conditions and a difficult comparison with 2024 due to the timing of Easter and eclipse-related travel, the statement said. Excluding those effects, RevPAR fell approximately 1.6 percent. Meanwhile, the domestic extended-stay portfolio outperformed the broader lodging industry by 40 basis points in RevPAR, while the economy transient portfolio exceeded its chain scale by 320 basis points.
Adjusted EBITDA rose 2 percent to $165 million, or $167 million excluding a $2 million operating guarantee related to the Radisson Hotels Americas acquisition. Adjusted diluted EPS increased 4 percent to $1.92, the statement said.
Expansion and development
The domestic extended-stay portfolio grew 10.5 percent year over year, with a pipeline of nearly 43,000 rooms as of June 30, Choice said. The combined domestic upscale, extended-stay and midscale portfolio grew 2.3 percent. WoodSpring Suites expanded 9.7 percent to nearly 33,000 rooms and ranked first in guest satisfaction among economy extended-stay brands in the J.D. Power 2025 study. The domestic economy transient pipeline increased 8 percent to more than 1,700 rooms.
Choice acquired the remaining 50 percent interest in Choice Hotels Canada for approximately $112 million in July, funded through cash and credit. The deal expanded its Canadian brand portfolio from eight to 22 and added 327 properties and more than 26,000 rooms. The business is expected to contribute approximately $18 million in EBITDA in 2025.
International activity included a renewed master franchise agreement with Atlantica Hospitality International in Brazil for more than 10,000 rooms; a direct franchise deal with Zenitude Hotel-Residences in France, which nearly tripled room count and two agreements with SSAW Hotels & Resorts in China. These include a 9,500-room distribution deal for 2025 and a master franchise agreement projected to add 10,000 rooms over five years.
Global net rooms for upscale brands increased 14.7 percent year over year, the statement said. The pipeline for these brands rose 7 percent since March 31 to nearly 29,000 rooms.
2025 outlook
Choice revised its RevPAR outlook to reflect more moderate domestic expectations due to macroeconomic conditions, the statement said. The adjusted EBITDA forecast includes a $6 million contribution from the Choice Hotels Canada acquisition for the remainder of 2025. It also reflects the $2 million Radisson-related operating guarantee payment incurred in the second quarter.
Net income guidance was lowered to a range of $261 million to $276 million, down from $275 million to $290 million. Adjusted net income remains at $324 million to $339 million.
Domestic RevPAR growth was revised to between negative 3 percent and flat, compared to the earlier range of negative 1 percent to positive 1 percent. The global net system rooms growth projection remains at approximately 1 percent.
In May, Choice reported 2.3 percent year-over-year growth in domestic RevPAR for the first quarter.
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G6 Hospitality and Galaxy Hotels Group are expanding Motel 6 and Studio 6 in the U.S.
Galaxy said G6 brands outperform others in guest satisfaction and value.
One Galaxy hotel generates $8–10M annually; the full G6 portfolio is expected to reach $50M.
G6 HOSPITALITY AND Galaxy Hotels Group are now working to expand the Motel 6 and Studio 6 footprint in the U.S. About 10 Galaxy-managed hotels, totaling more than 1,300 rooms, will operate under the G6 brands, with more to follow.
G6 brands consistently outperform others in guest satisfaction and value, said Galaxy, which rejoined the G6 network after a short break.
“This partnership marks a new chapter in our mission to deliver modern, value-driven hospitality, as we now proudly rejoin G6 Hospitality," said Carlos Cuevas, Galaxy Hotels' COO. "Having previously moved from Choice Group/Park Inn by Radisson, we’ve closely compared the performance of various franchises. Our experience and data show that G6 brands consistently outperform others in guest satisfaction and value. This is why we’re back."
Recent additions include Studio 6 Suites Las Vegas with 308 rooms, Motel 6 Las Vegas – I-15 Stadium with 139 rooms and Motel 6 Las Vegas – Boulder Highway with 160 rooms, the companies said. Studio 6 Suites Las Vegas on the Strip, with more than 300 rooms, will be one of the largest Studio 6 hotels in the U.S., while Motel 6 Las Vegas is also near the Strip and Allegiant Stadium. The portfolio also includes Motel 6 hotels in Modesto, San Jose and Santa Rosa, California and Lakewood, Fort Collins, Thornton and Colorado Springs, Colorado.
Texas-based Galaxy Hotels Group, founded in 1999 and led by CEO Jagmohan “Jag” Dhillon, operates more than 41 hotels in the U.S. One Galaxy hotel in the G6 network generates $8 to 10 million in annual revenue. The full G6 portfolio is expected to reach about $50 million.
OYO CEO Ritesh Agarwal is chair of G6 Hospitality and Sonal Sinha is its CEO. OYO added more than 150 hotels to its U.S. portfolio in the first half of 2025 and plans 150 more by year-end.
Marriott International ended Q2 with a record pipeline of about 3,900 properties and more than 590,000 rooms.
Global RevPAR rose 1.5 percent, including a 5.3 percent gain in international markets.
Net income slipped 1 percent to $763 million; 17,300 net rooms were added.
MARRIOTT INTERNATIONAL’S GROWTH continued in the second quarter, according to the company’s recent earnings report. Along with its active pipeline, the company saw rising revenue and launched a new brand.
Marriott’s global development pipeline stood at approximately 3,900 properties with more than 590,000 rooms at the end of the second quarter. The company added about 17,300 net rooms, signed nearly 32,000 and reported more than 70 percent of signings and 8,500 of added rooms in international markets.
“Marriott delivered another solid quarter, highlighted by strong financial results and robust net rooms growth despite heightened macro-economic uncertainty,” said Anthony Capuano, Marriott president and CEO. “Global RevPAR increased 1.5 percent in the second quarter, primarily driven by the leisure segment. International RevPAR rose more than 5 percent, with strong growth in APEC and EMEA. In the U.S. and Canada, RevPAR was flat year over year with continued strength in the luxury segment offset by a decline in select-service demand, largely reflecting reduced government travel and weaker business transient demand. Adjusting for the Easter holiday shift, U.S. and Canada RevPAR increased by nearly 1 percent.”
Base management and franchise fees rose nearly 5 percent to $1.2 billion, driven by RevPAR growth, room additions and co-branded credit card fees, the statement said. Reported operating income increased to $1.236 billion from $1.195 billion, while net income declined 1 percent to $763 million. Reported diluted earnings per share were $2.78, up from $2.69.
Adjusted operating income rose to $1.186 billion from $1.120 billion, Marriott said. Adjusted net income increased to $728 million from $716 million and adjusted diluted EPS rose to $2.65 from $2.50. Adjusted EBITDA grew 7 percent to $1.415 billion.
Pipeline and brands
Marriott added about 17,300 net rooms in the quarter, including over 8,500 internationally, bringing its global system to more than 9,600 properties and around 1.736 million rooms. It signed nearly 32,000 rooms, over 70 percent in international markets. Conversions made up about 30 percent of signings and openings in the first half. Full-year net rooms growth is expected to approach 5 percent.
Marriott Bonvoy membership also reached nearly 248 million by the end of June, the statement said.
“Development activity remained robust,” Capuano said. “We signed nearly 32,000 rooms, more than 70 percent of which were in international markets, and our quarter-end pipeline stood at a record of more than 590,000 rooms. Conversions continued to be a key driver of growth, representing approximately 30 percent of our room signings and openings in the first half of this year. We still expect full year net rooms growth to approach 5 percent this year.”
The development pipeline included 3,858 properties and more than 590,000 rooms, with 234 properties and over 37,000 rooms approved but not yet under contract, the statement said. The pipeline included 1,447 properties with more than 238,000 rooms under construction or conversion. Over half of the pipeline rooms were outside the U.S. and Canada.
The company launched Series by Marriott, a regional collection brand for midscale and upscale segments, and announced its first agreement to affiliate India’s Fern portfolio. Marriott also completed the acquisition of citizenM. However, the citizenM and Series by Marriott additions were not included in the pipeline total.
Capuano said both brands are expected to support international expansion.
2025 outlook
Marriott’s outlook assumes no major shifts in macroeconomic conditions. The company expects RevPAR to be flat to up 1 percent in the third quarter of 2025 and grow 1.5 to 2.5 percent for the full year. Net rooms growth is projected to approach 5 percent in 2025.
Gross fee revenues are expected to total $1.310 billion to $1.325 billion in the third quarter and $5.365 billion to $5.420 billion for the year. Adjusted EBITDA is forecast at $1.288 billion to $1.318 billion for the third quarter and $5.310 billion to $5.395 billion for the full year.
OYO added more than 150 U.S. hotels in early 2025 and plans 150 more by year-end.
Ten additions have more than 100 rooms, reflecting a focus on high-inventory properties.
It is targeting urban and suburban markets in the Sun Belt and Great Lakes regions.
HOSPITALITY TECHNOLOGY COMPANY OYO added more than 150 hotels to its U.S. portfolio in the first half of 2025 and plans to add 150 more by year-end. The additions span Texas, Virginia, Georgia, Mississippi, California, Michigan and Illinois.
The company is focusing on high-inventory properties and has added 10 with more than 100 rooms, OYO U.S. said in a statement.
“2025 is shaping up to be a busy year for all of us at OYO,” said Nikhil Heda, head of development, OYO U.S. “We’re helping hotel owners drive revenue and improve operations through our technology. Our growing portfolio gives travelers more options, and momentum on our direct channels shows OYO is becoming a trusted brand for new and returning guests.”
Recent additions include the 400-room Palette Sunset Waves Resort in Myrtle Beach, the 130-room Capital O Kings Inn in Memphis, the 130-room Travellers Inn by OYO in Douglas, Georgia, and the 140-room Jackson Hotel and Convention Center in Jackson, Tennessee. All were previously independent hotels.
The company is exploring urban and suburban markets across the Sun Belt and Great Lakes regions, targeting areas with high demand and growth potential, the statement said.
OYO CEO Ritesh Agarwal, who also chairs G6 Hospitality, the parent of Motel 6 and Studio 6, recently launched a contest to rename Oravel Stays, offering a $3,500 prize.
Choice launched two campaigns to boost bookings across its four extended-stay brands.
Based on guest feedback, the campaigns focus on efficiency, cleanliness, value and flexibility.
They will run through 2026 across social media, Connected TV, digital display and online video.
CHOICE HOTELS INTERNATIONAL launched two marketing campaigns to increase brand awareness and bookings across its four extended-stay brands. The "Stay in Your Rhythm" campaign promotes all four brands by showing how guests can maintain daily routines, while "The WoodSpring Way" highlights the service WoodSpring Suites staff provide.
The company has more than 550 extended-stay locations open, 51 under construction and more than 350 in the pipeline under Everhome Suites, MainStay Suites, Suburban Studios and WoodSpring Suites, Choice said in a statement.
"As leaders in the extended stay segment, Choice Hotels has long understood that this category is unlike any other in the hospitality industry, defined by distinct guest expectations that we continuously strive to exceed," said Noha Abdalla, Choice’s chief marketing officer. "These first-of-their-kind campaigns reflect our deep understanding of why people stay longer — from work assignments and relocations to life transitions and personal journeys. No matter the reason, we know our guests aren't looking to escape their routines; they're looking to maintain them. That's why we take pride in our unique position to offer what matters most: consistency, comfort and connection."
Both campaigns are based on research and guest feedback showing travelers prioritize efficiency, cleanliness, value and flexibility, the statement said. They will run through the rest of the year and into 2026 across paid social media, Connected TV, digital display and online video.
The "Stay in Your Rhythm" campaign shows how Choice's extended-stay brands support routines with in-room kitchens, laundry, fitness centers and pet-friendly options, Choice said. It focuses on daily habits like making coffee, cooking, walking the dog, or exercising.
"The WoodSpring Way" highlights how property teams support guests by providing home-like conveniences, the company said. General managers in Chicago, Denver, Atlanta and Orlando are featured for creating a consistent guest experience and welcoming all guests, including pets.
"We've designed our extended stay properties to ensure we provide guests with everything they need when circumstances take them away from home for weeks at a time," said Matt McElhare, Choice's vice president for extended stay brands. "Through the launch of our campaigns, we aim to educate the growing population of extended stay travelers on how our brands offer the best value in the industry, while also highlighting the culture of our flagship brand, WoodSpring Suites, which has consistently set the standard for guest satisfaction in the segment. We're especially thankful to our owners and management company teams who help build and sustain this culture on property, consistently delivering a great guest experience."