How Much Does a Hampton Inn Franchise Owner Make?

Officially, Item 19 measures room performance, not owner earnings. For calendar 2025, the disclosure reports Average Room Rate, Occupancy, Revenue Per Available Room (RevPAR), RevPAR Index, and Hilton Honors contribution for U.S. Hampton Inn and Hampton Inn & Suites hotels. It does not disclose full hotel revenue or any profit measure.

The broad Comparable Hotel population contained 1,893 hotels: 15 company-managed and 1,878 franchisee-managed. The New Generation population contained 294 hotels opened during or after 2018: one company-managed and 293 franchisee-managed. Both populations combine Hampton Inn and Hampton Inn & Suites, so the disclosure does not isolate an 89-room Hampton Inn result.

FDD source: 2026 U.S. Hampton Franchise Disclosure Document, Item 19 pp. 77-84. The broad-cohort table appears on pp. 78-81; the New Generation tables appear on pp. 81-83.

The model uses the $107.53 New Generation median RevPAR because a median is less sensitive than an average to very high or very low observations. Item 19 also reports a 72.3% median occupancy and a $149.21 median room rate for this cohort. Among the 293 franchisee-managed New Generation hotels, 146, or 49.8%, met or exceeded the reported median RevPAR.

The estimate converts Item 19 RevPAR into annual Gross Rooms Revenue, then applies a Hampton-adjusted property-level earnings ratio. The period is calendar 2025, the modeled format is the 89-room Hampton Inn described in Item 7, and every output is an independent scenario.

Because Item 19 provides no quartiles for New Generation RevPAR, the revenue anchors are explicit editorial assumptions: 80%, 100%, and 120% of the $107.53 median. They are analytical cases, not probabilities and not FDD-reported performance bands.

The operating benchmark comes from Apple Hospitality REIT's full-year 2025 results. Its 217-hotel, rooms-focused U.S. portfolio reported $476.525 million of Adjusted Hotel EBITDA, $1.278423 billion of room revenue, and $62.55 million of franchise fees. The model removes that mixed-brand franchise-fee burden and substitutes Hampton's disclosed recurring fee structure. This is a proxy, not same-brand operating data.

Direct owner management may add approximately $66,880 of labor value, but it does not automatically add the same amount of passive business profit. Item 15 permits owner management only with Hilton's prior written approval and successful training unless waived; Hilton may instead require an approved management company.

The owner-operator illustration adds the BLS May 2024 median wage of $66,880 for lodging managers in traveler accommodation to the manager-run residual. It assumes the owner genuinely replaces one paid lodging-manager role. The figure excludes payroll taxes and benefits and does not assume that every third-party management fee disappears.

The largest directly modeled burden is 13.58% of Gross Rooms Revenue. The official components are a 6% Monthly Royalty Fee, a 4% Monthly Program Fee, and a Hilton Honors charge of 4.6% of eligible guest folio. The 3.58% Honors amount used below is estimated, not the FDD's effective rate.

To estimate Hilton Honors expense, the model multiplies the 4.6% eligible-folio rate by Item 19's 77.8% average Hilton Honors Contribution to Occupancy for all Comparable Hotels. This is imperfect: member-occupied room nights include reward stays and other stays that may not produce an eligible folio, and room-night share is not necessarily revenue share.

Fee sources: 2026 U.S. Hampton Franchise Disclosure Document, Item 6 pp. 20-32 and Item 19 p. 80; Apple Hospitality REIT full-year 2025 operating results. Dollar effects use the base Gross Rooms Revenue and are rounded to the nearest $1,000.

Item 6 also lists OnQ connectivity, hardware and software support, Connected Room maintenance, user-based systems, reservation and distribution charges, revenue-management services, and other required or conditional fees. Those amounts are not separately subtracted because the external property-level benchmark already includes broad hotel administrative, sales and marketing, management, property-tax, insurance, utility, repair, and maintenance expenses; some technology costs may be embedded in those categories. Adding every Hampton line item without a line-level mapping would risk double counting. Conversely, any Hampton-specific required fee not represented in the proxy would reduce actual earnings. A buyer should replace the proxy with the hotel's complete operating budget.

Hilton's 2025 Form 10-K provides parent-company context: franchise royalties are generally tied to monthly gross room revenue, while program fees reimburse marketing, sales, brand-program, and shared-service costs.

The largest unresolved uncertainty is the hotel's real expense structure, not the RevPAR arithmetic. Item 19 supplies a strong room-revenue metric, but it does not show labor, occupancy costs, property taxes, insurance, management fees, repairs, utilities, or property-level profit for Hampton franchisees.

• Format mix: the New Generation cohort combines Hampton Inn and Hampton Inn & Suites and does not report results by room count, market type, or owner portfolio.
• Benchmark comparability: Apple Hospitality is a mixed-brand, upscale, rooms-focused portfolio rather than a Hampton-only franchisee population. Its expense ratios may not match an individual market or management agreement.
• Revenue coverage: RevPAR produces Gross Rooms Revenue. The external benchmark also reflects food-and-beverage and other hotel revenue, so the derived earnings-to-room-revenue ratio may overstate or understate a specific Hampton hotel's ancillary economics.
• Hilton Honors charge: the modeled 3.58% rate uses occupancy contribution as a proxy for eligible folio. The actual effective percentage must be calculated from property-level transaction data.
• Capital spending: the result excludes furniture, fixtures, equipment reserves, renovations, and other capital expenditures. Adjusted Hotel EBITDA is not free cash flow.
• Financing: interest and principal payments are excluded. Item 7 estimates $17.04 million to $24.73 million of initial investment for an 89-room new-construction Hampton Inn, excluding real property; that startup amount is not an annual expense, but financing it can materially reduce owner distributions.

The industry classification is closest to NAICS 721110, Hotels (except Casino Hotels) and Motels. That classification supports benchmark selection, but a broad industry code cannot substitute for a site-specific hotel budget.

A buyer should treat the range as a screening model and replace every proxy with written, property-specific evidence. The applicable evidence period is 2025, and the most relevant comparisons are mature U.S. Hampton hotels with similar room counts, market demand, owner involvement, and management structure.

• Request Item 19 substantiation for the New Generation tables and confirm the definitions, exclusions, room counts, and distribution behind the $107.53 median RevPAR.
• Ask current Hampton Inn and Hampton Inn & Suites franchisees for complete property-level statements separating room revenue, other revenue, payroll, management fees, franchise fees, repairs, taxes, insurance, and capital reserves.
• Verify the effective Hilton Honors charge, distribution fees, revenue-management fees, technology charges, and every other required Item 6 fee for the specific property.
• Confirm whether Hilton will approve direct owner management under Item 15, which roles the owner would actually replace, and whether a third-party management fee remains.
• Build debt service from actual lender terms and keep interest, principal, capital expenditures, depreciation, owner salary, distributions, and personal taxes as separate lines.
• Compare the proposed market study with local competitor RevPAR, seasonality, property taxes, insurance, wage rates, and renovation requirements rather than relying on system medians alone.

The FTC's franchise guidance recommends asking for written substantiation and considering whether the claim applies to the buyer's intended operating model.