That is an independent pre-tax hotel EBITDA proxy, not an Aloft Item 19 owner-profit disclosure. The range spans a conservative 100-room model to an upside 135-room model. Base scenarios are approximately $1.56 million for 100 rooms and $2.11 million for 135 rooms.
Independent-estimate disclosure. These figures are analytical scenarios prepared independently; they are not a financial performance representation made by MIF, L.L.C. in Item 19. The model combines identified facts from the 2026 Aloft Domestic Franchise Disclosure Document with a separately identified upscale, rooms-focused hotel portfolio benchmark and explicit scenario assumptions. Actual results can differ materially because of location, hotel size, Average Daily Rate, Occupancy, labor, property taxes, insurance, channel commissions, financing, owner oversight, management-company terms, renovations and execution.
Data basis. Legal franchisor: MIF, L.L.C., a subsidiary of Marriott International, Inc. The official 2026 Aloft Domestic FDD was issued March 31, 2026. Item 19 reports 2025 operating performance—not Gross Sales, Net Income, owner compensation or cash distributions—for mature franchised Aloft by Marriott hotels in the United States and Canada. The estimate uses the FDD’s RevPAR evidence and the 2024 operating statement of Apple Hospitality REIT’s upscale, rooms-focused U.S. hotel portfolio. Checked July 20, 2026.
What does Aloft Item 19 actually measure?
Officially, Item 19 measures hotel room-performance indicators, not annual owner earnings. For calendar 2025, it reports Average Daily Rate, Occupancy, Revenue Per Available Room and RevPAR Index for a defined cohort of mature franchised Aloft by Marriott hotels in the United States and Canada. It does not state Gross Sales, operating profit, Adjusted Hotel EBITDA, Net Income, owner salary, distributions or after-tax take-home pay.
The principal cohort contained 154 “STR Included Hotels” from 167 franchised hotels operating at year-end 2025. Eligible hotels generally had operated for at least two years and met conditions concerning renovations, additions and room availability. Item 19 reports an average ADR of $156.92, average Occupancy of 69.5%, average RevPAR of $109.06 and average RevPAR Index of 101.7. The FDD also reports a 159-hotel one-year comparable cohort with average RevPAR of $108.14.
The median and average sit well below the maximum, so a single average should not be treated as a typical guaranteed result.
Interpretation: The official spread is extremely wide. Location and market position can dominate the earnings outcome even before cost structure and debt are considered.
Source: 2026 Aloft Domestic FDD, Item 19, pp. 112–117. Values cover 2025 STR Included Hotels in the United States and Canada.
RevPAR equals room revenue divided by available rooms. It does not include every hotel revenue stream, and it does not deduct payroll, utilities, repairs, franchise fees, management fees, property taxes, insurance, interest or capital expenditures. That is why the Item 19 average cannot be presented as owner income.
How was the annual owner-earnings range estimated?
The estimate is scenario-based and uses a reproducible RevPAR-to-hotel-EBITDA bridge. It begins with the official $109.06 average RevPAR, models 100-room and 135-room hotels within the two new-build size bands in Item 7, applies an analytical 80%/100%/120% RevPAR spread, and then uses an upscale rooms-focused U.S. hotel operating benchmark.
- Step 1 — Annual room revenue
- Scenario RevPAR × guestrooms × 365 days.
- Step 2 — Estimated total hotel revenue
- Annual room revenue × 1.10238. The multiplier is derived from Apple Hospitality REIT’s 2024 actual total revenue of $1.431468 billion divided by actual room revenue of $1.298525 billion.
- Step 3 — Estimated pre-tax owner earnings proxy
- Estimated total hotel revenue × scenario Adjusted Hotel EBITDA margin. The 35.6% base margin is derived from $509.544 million of 2024 Adjusted Hotel EBITDA divided by $1.431468 billion of actual total revenue; conservative and upside margins are 3 percentage points lower and higher.
| Scenario | RevPAR anchor | 100-room estimate | 135-room estimate |
|---|---|---|---|
|
Conservative 80% of FDD average; 32.6% margin |
$87.25 | $1.14M | $1.54M |
|
Base 100% of FDD average; 35.6% margin |
$109.06 | $1.56M | $2.11M |
|
Upside 120% of FDD average; 38.6% margin |
$130.87 | $2.03M | $2.74M |
Values are pre-tax hotel-level proxies before financing and capital expenditures, not passive distributions.
Interpretation: Guestroom count scales the result, but RevPAR and cost conversion remain decisive. A larger hotel with weak rate or occupancy can earn less than a smaller, better-positioned hotel.
Sources and formula: 2026 Aloft Domestic FDD, Item 19 and Item 7; Apple Hospitality REIT 2024 results. Calculations use full precision and are rounded to the nearest $1,000.
What the estimate includes and excludes
- Included through the benchmark: normal hotel operating expenses, franchise fees, management fees, property taxes and insurance at the portfolio level.
- Excluded: interest, income taxes, depreciation, amortization, debt principal, capital expenditures, FF&E reserve funding and owner-level overhead not captured in the hotel statement.
- Room counts: 100 and 135 rooms are analytical examples inside the FDD’s 80–110 and 120–150 new-build bands; they are not reported system averages.
- Revenue spread: 80%, 100% and 120% of average RevPAR is an editorial sensitivity, not an Item 19 quartile or probability forecast.
- Benchmark limitation: Apple Hospitality is a diversified upscale, rooms-focused portfolio—not the Aloft franchise system—and its results include only one Aloft hotel by brand count.
Which Aloft fees materially affect owner earnings?
Officially, the largest readily quantifiable recurring charges begin with 8.25% of Gross Room Sales plus fixed annual Program Services amounts. Item 6 lists a 5.5% franchise fee and a 2.75% Program Services Contribution, including a 1% marketing-fund component. It also lists $10,000 per year plus $220 per guestroom per year.
| Recurring obligation | Official amount | Treatment in this model |
|---|---|---|
| Franchise fee | 5.5% of Gross Room Sales | Not subtracted again; the external hotel margin includes franchise-fee expense. |
| Program Services Contribution | 2.75% of Gross Room Sales | Not subtracted again to avoid double counting. |
| Fixed Program Services amounts | $10,000 + $220/room/year | Equivalent to $32,000 for 100 rooms and $39,700 for 135 rooms; assumed embedded in the portfolio margin. |
| Marriott Bonvoy contribution | 3.2% of qualifying revenue through 2027 | Not separately modeled because qualifying revenue varies and the margin benchmark already includes loyalty/franchise costs. |
| Channels, sales, technology and optional services | Variable | Potentially material; must be tested against the proposed hotel’s channel mix and agreements. |
The 35.6% benchmark margin comes from a hotel operating statement that already records franchise fees and management fees. Subtracting Aloft’s 8.25% core percentage charges again would understate the scenario. The correct diligence question is whether the proposed hotel’s complete fee and channel burden is above or below the benchmark portfolio’s embedded burden.
Fee source: 2026 Aloft Domestic FDD, Item 6, pp. 31–57. Item 7 opening investment is not treated as an annual expense.
Does hands-on ownership increase Aloft earnings?
Owner involvement may improve execution, but the FDD does not support adding a general manager’s wage to profit. Item 15 permits the franchisee to operate the hotel or retain an approved management company, yet a trained general manager must directly supervise the property and managers must devote full time to operations. Therefore, this is not a conventional owner-operator model in which the owner simply replaces a paid store manager.
Qualified owner-led operation
The owner can remain active in asset management, revenue strategy, labor productivity, expense approvals and management accountability. The required onsite general manager remains an operating cost. Any owner salary or asset-management compensation must be separated from residual business profit.
Approved management company
A management company can supply operating systems and depth, but its base and incentive fees reduce hotel-level cash flow. The scenario benchmark already includes management fees, so this article does not add a second assumed management-company charge.
The Bureau of Labor Statistics accommodation profile reports 2025 lodging-manager wages of $67,110 median and $77,120 mean. Those figures provide labor-market context only; they are not an Aloft payroll budget, and they are not an owner-profit add-back.
The most defensible owner-involvement effect is indirect: stronger rate discipline, better Occupancy, tighter scheduling, lower commission leakage and more rigorous management oversight can move RevPAR and margin. The FDD does not quantify that effect, so no extra “owner salary” is inserted into the earnings range.
Why is the evidence confidence limited?
The confidence rating is LIMITED because Aloft Item 19 does not disclose owner profit and the model depends materially on an external portfolio proxy. The FDD provides strong same-brand RevPAR evidence, but the conversion from hotel revenue to Adjusted Hotel EBITDA comes from a diversified U.S. portfolio rather than the 154-hotel Aloft cohort.
Material uncertainties that can move the range
- Geography: the Item 19 population combines U.S. and Canadian hotels, with Canadian results converted to U.S. dollars; it is not a U.S.-only sample.
- Distribution: Item 19 gives a minimum, maximum and median, but no RevPAR quartiles for the main cohort. The 80%/100%/120% spread is analytical.
- Hotel maturity: the principal cohort generally excludes hotels open less than two years and hotels affected by specified renovations or room additions.
- Property-specific fixed costs: real estate taxes, insurance, ground rent, union exposure and utility costs vary sharply by market.
- Capital needs: Adjusted Hotel EBITDA is not distributable cash after renovations, replacement reserves and required property-improvement plans.
- Financing: interest and principal are excluded. A highly leveraged project can have little distributable cash even when hotel EBITDA is positive.
- Channel economics: reservation-system contribution, online travel agency commissions, loyalty charges and group mix affect the cost of each room-night sale.
Industry evidence reinforces the cost risk. CoStar’s 2024 U.S. hotel P&L release reported that labor costs grew 11.2% year over year, while EBITDA per available room grew 2.5%. CBRE’s 2,600-hotel operating-cost analysis found 2024 expenses rose faster than revenue and identified labor, technology, franchise-related fees, maintenance and insurance as pressure points. These sources do not replace Aloft Item 19; they explain why margin sensitivity is necessary.
What should a buyer verify before relying on this range?
A buyer should replace every portfolio assumption with property-specific evidence before underwriting distributions. The Federal Trade Commission explains that Gross Sales do not establish profit and that prospective franchisees may request written substantiation for Item 19 claims. The strongest validation comes from the current FDD, the proposed site’s operating model, lender terms and interviews with comparable current and former franchisees.
Questions for the franchisor and franchisees
- Request the current Item 19 substantiation and confirm whether the proposed market resembles the STR Included Hotels.
- Ask for monthly room revenue, food-and-beverage revenue, other revenue, payroll, franchise fees, loyalty charges, commissions, management fees, property taxes, insurance and utilities for comparable hotels.
- Separate Gross Operating Profit, Adjusted Hotel EBITDA, capital reserve funding, interest, principal and actual owner distributions.
- Confirm the exact management-company agreement, including base fee, incentive fee, centralized charges and termination rights.
- Test the project at the FDD median RevPAR of $97.79, not only at the $109.06 average.
- Ask recent transferors and former franchisees why they sold or exited; Item 20 reported eight transfers in 2025.
- Obtain a property tax, insurance, wage, utility, renovation and FF&E reserve budget for the specific site.
- Recalculate cash available after the actual debt schedule; do not equate hotel EBITDA with personal take-home pay.
What is the strongest defensible earnings takeaway?
A reasonable analytical range is approximately $1.14 million to $2.03 million annually for a 100-room hotel and $1.54 million to $2.74 million for a 135-room hotel, with base estimates of $1.56 million and $2.11 million. These are scenario-based pre-tax Adjusted Hotel EBITDA proxies—not official Aloft owner earnings—and they are before interest, debt principal, capital expenditures, FF&E reserves and personal taxes.
The largest earnings driver is the interaction between RevPAR and cost conversion: small changes in Average Daily Rate, Occupancy, labor efficiency and channel cost can move hotel EBITDA substantially. The largest unresolved uncertainty is whether a specific Aloft property’s total-revenue mix and expense structure resemble the external upscale, rooms-focused portfolio benchmark. A buyer should verify the Item 19 substantiation, test the FDD median and local downside cases, and obtain actual hotel-level statements from comparable franchisees before estimating distributions.