A manager-run, 100-room Hawthorn Extended Stay by Wyndham hotel may produce roughly $490,000 to $940,000 a year in pre-tax, EBITDA-style owner earnings, with a modeled base case near $699,000. This is a 2025 operating scenario anchored to the median RevPAR in the March 31, 2026 Franchise Disclosure Document. It is not an earnings figure reported by Hawthorn Suites Franchising, Inc.
- Legal franchisor
- Hawthorn Suites Franchising, Inc., a Georgia corporation
- FDD basis
- Issued March 31, 2026; Item 19 covers January 1–December 31, 2025
- Official Item 19 measure
- ADR, Occupancy Rate, RevPAR, RevPAR Index, and reservation-channel contribution—not owner profit
- Applicable U.S. formats
- New construction and conversion extended-stay hotels; the cover models 96 rooms and 100 rooms, respectively
- Benchmark basis
- 2024 U.S. hotel TRevPAR and EBITDA per available room from CoStar/STR; BLS lodging-manager pay for owner-role analysis
- Date checked
- July 19, 2026
Qualified U.S. franchised Hawthorn facilities in 2025; revenue per available room, not earnings.
Only 41.5% of year-end U.S. facilities met Item 19’s age and social-review eligibility rules.
5.5% royalty and 2.5% Marketing/Reservation Contribution, both based on Gross Room Revenues.
Derived from $51.88 EBITDA PAR divided by $209.67 TRevPAR for U.S. hotels in 2024.
May 2024 median annual wage for lodging managers in traveler accommodation; benefits are excluded.
What does the 2026 Hawthorn FDD actually disclose?
The official disclosure measures room-rate and occupancy performance, not annual owner income. For 34 Qualified Chain Facilities, Item 19 reports average and median Average Daily Room Rate, Occupancy Rate, RevPAR, and RevPAR Index for 2025. It does not report operating profit, EBITDA, Net Income, owner compensation, cash flow, or distributions. Source: Hawthorn Suites Franchising, Inc. 2026 FDD, Item 19, pp. 85–87.
The official U.S. Hawthorn franchise-development page describes the offer as a midscale extended-stay concept available through new construction and high-quality conversion. Its published brand-performance section also references the March 31, 2026 FDD and 2025 U.S. results.
| Official 2025 metric | Average | Median | Population note |
|---|---|---|---|
| Average Daily Room Rate | $112.04 | $105.39 | 34 Qualified Chain Facilities |
| Occupancy Rate | 67.0% | 67.5% | 17 of 34 met or exceeded the average |
| RevPAR | $75.01 | $77.39 | 19 of 34 met or exceeded the average |
| RevPAR Index | 134.6% | 138.9% | Compared with the U.S. midscale chain scale |
RevPAR equals gross room revenue per available room. It can be annualized for a stated room count, but it cannot be called profit or owner earnings.
How is the owner-earnings range calculated?
The model converts the FDD’s median RevPAR into annual room revenue for a normalized 100-room conversion, then applies a broad hotel EBITDA margin proxy. The result is estimated, not official. A 100-room basis is used because the FDD cover describes a typical conversion as 100 rooms; a 96-room new-construction hotel would produce 4% less room revenue at the same RevPAR.
- Conservative: 80% of the FDD median RevPAR and a 21.7% margin, which is three percentage points below the benchmark.
- Base: 100% of the FDD median RevPAR and the 24.7% benchmark margin.
- Upside: 120% of the FDD median RevPAR and a 27.7% margin, three percentage points above the benchmark.
- The 80%/100%/120% revenue spread and ±3 percentage-point margin band are editorial sensitivity assumptions because Item 19 does not publish a full RevPAR distribution or property-level profit data.
| Scenario | Annual room revenue | EBITDA margin | Estimated owner earnings |
|---|---|---|---|
| Conservative | $2,260,000 | 21.7% | $491,000 |
| Base | $2,825,000 | 24.7% | $699,000 |
| Upside | $3,390,000 | 27.7% | $940,000 |
EBITDA-style operating earnings before financing, depreciation, amortization, capital expenditures, and personal taxes.
Interpretation: RevPAR and margin compound each other, so a 20% increase in room revenue plus a three-point margin improvement lifts modeled earnings by substantially more than 20%. Source basis: Hawthorn 2026 FDD, Item 19, pp. 85–87; CoStar/STR 2024 U.S. hotel profitability data.
How does active owner involvement change the result?
An experienced owner who personally performs the general-manager role may create about $66,880 of additional annual owner-operator benefit, but that amount is compensation for labor—not passive business profit. The FDD says personal participation is not required, although it is recommended. A non-managing owner must retain a qualified manager or management company, and Hawthorn Suites Franchising, Inc. may require an approved third-party manager when the owner lacks significant hotel-management experience or receives a Development Incentive. Source: 2026 FDD, Item 15, p. 78.
The labor-value assumption uses the Bureau of Labor Statistics lodging-manager wage data: the May 2024 median annual wage in traveler accommodation was $66,880. The figure excludes employer payroll taxes, benefits, and any premium for a larger or more complex hotel.
The owner-operator value adds $66,880 of manager labor to each operating scenario.
Interpretation: The gap is labor value. It should not be described as passive income, and it disappears if Hawthorn requires a third-party manager or the owner keeps a paid general manager.
Which FDD fees can move annual owner earnings?
The fixed 8% royalty-and-marketing charge is only the first layer of the recurring fee structure. At the base scenario’s $2.825 million of gross room revenue, 5.5% royalty plus 2.5% Marketing/Reservation Contribution equals about $226,000 a year. This figure is official-fee arithmetic, not a separate deduction from the scenario model, because the 24.7% EBITDA benchmark is treated as an all-in operating-margin proxy.
Source: Hawthorn Suites Franchising, Inc. 2026 FDD, Item 6, pp. 29–44. Transaction-based distribution fees, commissions, complaint costs, training, conference, and other conditional charges can add further expense. Do not add every percentage to Gross Room Revenues: several apply only to a subset of bookings or member-eligible revenue.
Why should a buyer treat the range as limited-confidence?
The largest uncertainty is the missing property-level profit statement for the Hawthorn cohort. Item 19 gives top-line room metrics but no labor, breakfast, housekeeping, utilities, insurance, repairs, property tax, management, franchise-program, or capital-reserve line items. The margin therefore comes from a broad U.S. hotel benchmark, not from Hawthorn franchisees.
The CoStar/STR 2024 hotel P&L release reports $209.67 of total revenue per available room and $51.88 of EBITDA per available room across U.S. hotels. That implies 24.7%, but it is not specific to midscale extended-stay hotels. CBRE’s extended-stay hotel research finds lower housekeeping and front-office labor costs and higher Gross Operating Profit margins than comparable limited-service hotels, but its public article does not provide a Hawthorn-specific EBITDA margin. This supports the operating-model logic, not the exact scenario numbers.
Item 20 adds another caution. The U.S. system rose from 71 to 82 franchised outlets during 2025 through 13 openings and two outlets ceasing operations for other reasons; there were no company-owned Hawthorn outlets. New properties may be ramping, and the absence of company-owned units means there is no same-brand corporate-store profit proxy. Source: 2026 FDD, Item 20, pp. 88–92. Wyndham Hotels & Resorts also describes itself as an asset-light franchisor in its 2025 Form 10-K.
What should a prospective owner verify before relying on this range?
A buyer should replace the broad margin proxy with actual Hawthorn property evidence before underwriting a purchase. The Federal Trade Commission’s franchise buyer guidance explains that Item 19 is the place for franchisor sales or earnings claims, while the FTC’s Item 19 evaluation guidance recommends examining the source, assumptions, limitations, and written substantiation behind financial performance representations.
- Request the written substantiation supporting 2025 ADR, Occupancy Rate, RevPAR, RevPAR Index, and contribution metrics.
- Ask for room-count distribution, property age, conversion versus new-construction status, market type, and performance of the two 2025 system leavers.
- Interview current and former franchisees about payroll, housekeeping frequency, breakfast cost, utilities, insurance, property tax, maintenance, management fees, and annual replacement reserves.
- Reconcile every Item 6 fee to the proposed hotel’s booking-channel mix, Wyndham Rewards mix, occupancy, room count, and chosen revenue-management service.
- Determine whether the owner is qualified to serve as general manager and whether Hawthorn will require an approved third-party manager.
- Model interest and principal using the buyer’s actual loan terms, then set a separate capital-expenditure reserve. Do not estimate personal after-tax income from the FDD.
What is the strongest defensible earnings takeaway?
The strongest defensible range is approximately $490,000 to $940,000 per year in manager-run, pre-tax, EBITDA-style owner earnings for a normalized 100-room Hawthorn conversion, with a base scenario near $699,000. It is scenario-based rather than an official Item 19 earnings result. The most important earnings driver is the combination of RevPAR and operating margin; the largest unresolved uncertainty is the absence of Hawthorn property-level expense and profit data. An active, qualified owner may add about $66,880 of labor value by replacing a paid lodging manager, but that creates owner-operator benefit rather than passive profit. Before proceeding, a buyer should verify Item 19 substantiation, actual fee incidence, comparable-hotel operating statements, required management structure, debt service, capital reserves, and franchisee experience.