How Much Does a Microtel Inn & Suites Franchise Owner Make?

Item 19 officially measures room-rate and occupancy performance—not owner profit. For 2025, it reports Average Daily Room Rate, Occupancy Rate, and RevPAR for qualified franchised hotels. RevPAR is gross room revenue per available room; it is a revenue productivity measure, not cash available to an owner.

The strongest format match is the “Newly Constructed Group,” because the current franchise offer is an all-new-construction hotel. Its 24 qualified hotels opened on or after January 1, 2019. Their median RevPAR was $73.71 and average RevPAR was $73.29. The broader qualified cohort contained 141 of 307 U.S. and Canadian chain hotels and had median RevPAR of $57.98.

The estimate starts with the official $73.71 median RevPAR for newly constructed hotels and converts it to annual room revenue for 81 rooms. The base calculation is $73.71 × 81 × 365 = $2,179,236 of annual Gross Room Revenue. Because Item 19 provides no distribution around that median, the conservative and upside revenue cases use 80% and 120% of the median as analytical—not FDD-reported—spreads.

The expense proxy comes from 2024 U.S. hotel P&L data reported by CoStar/STR: EBITDA per available room of $51.88 divided by total revenue per available room of $209.67 equals a 24.7% all-hotel EBITDA margin. The conservative and upside cases move that benchmark down and up by three percentage points, as a transparent sensitivity band. This is a broad industry proxy rather than a Microtel margin, which is the principal reason confidence is limited.

• Revenue spread: 80%, 100%, and 120% of the newly constructed median RevPAR.
• Margin spread: 21.7%, 24.7%, and 27.7% EBITDA-style margins.
• Fee treatment: The all-in EBITDA proxy is intended to reflect normal branded-hotel operating and ownership expenses, so the FDD’s royalty and marketing charges are not subtracted a second time.
• Excluded from earnings: Interest, debt principal, depreciation, amortization, capital expenditures, FF&E replacement spending, and personal income taxes.

The 8% column isolates the FDD’s 6% royalty and 2% Marketing/Reservation Contribution for visibility. It is already presumed within the all-in expense structure represented by the EBITDA-style margin and is not deducted twice. Usage-based reservation, agency, loyalty, technology, and other fees can add materially to the actual burden.

An active owner who legitimately replaces the paid general manager could add roughly $68,130 of labor value to each scenario. That figure is the May 2024 national median annual wage for lodging managers reported by the U.S. Bureau of Labor Statistics. The resulting amount is labeled owner-operator benefit, because it combines residual business earnings with compensation for work performed.

The 2026 FDD does not require the owner to participate personally, although the franchisor recommends involvement. A non-managing owner must hire an experienced individual manager or management company, and the general manager must complete required training. The franchisor may require an approved third-party manager when the owner lacks significant hotel-management experience or receives a Development Incentive. Therefore, not every owner can prudently or contractually capture the manager-wage component.

The clearest recurring percentage burden is 8% of Gross Room Revenue: a 6% royalty plus a 2% Marketing/Reservation Contribution. At the base revenue scenario, those two charges total about $174,000 a year. They are official FDD obligations, but they are not the entire franchise-related cost structure.

The largest uncertainty is the absence of a same-brand profit-and-loss disclosure. Item 19 gives RevPAR, ADR, occupancy, and channel contribution, but no payroll, occupancy cost, property tax, insurance, repairs, franchise-fee total, EBITDA, Net Income, or owner compensation. The external margin therefore carries more analytical weight than a buyer should accept without property-level substantiation.

Compatibility is imperfect in three specific ways. First, the FDD’s Item 19 population combines U.S. and Canadian hotels, while this article addresses a U.S. owner. Second, the CoStar/STR benchmark spans the U.S. hotel industry rather than Microtel’s economy, new-construction cohort. Third, the benchmark margin uses total hotel revenue, whereas the FDD anchor is Gross Room Revenue. A limited-service hotel generally has less ancillary revenue than a full-service property, but the difference is not zero.

System population also matters. Item 20 reports 280 U.S. franchised outlets and no company-owned U.S. outlets at December 31, 2025, down from 285 at the end of 2024. Item 19 separately reports 307 U.S. and Canadian chain hotels. These populations answer different questions and should not be merged.

What should a buyer verify before relying on the range?

A buyer should replace every broad assumption with market- and hotel-specific evidence. The FTC’s franchise-buying guide explains why Item 19 claims, written substantiation, and franchisee interviews must be evaluated together.

• Request the written substantiation for the 2025 Item 19 representation and confirm the exact newly constructed hotels included.
• Ask current and former franchisees for trailing-12-month room revenue, total revenue, payroll, manager cost, franchise and distribution fees, property tax, insurance, repairs, utilities, and EBITDA.
• Separate hotels managed by owners, individual general managers, and third-party management companies.
• Build a local comp-set model using market ADR, occupancy, RevPAR, seasonality, new supply, and demand generators.
• Obtain actual debt terms and show interest and principal below operating earnings; the FDD does not define a standard buyer financing package.
• Model an FF&E reserve and expected capital replacements separately from annual EBITDA-style earnings.
• Confirm whether the owner is qualified and permitted to replace the general manager before adding manager labor value.

The strongest defensible view is a limited-confidence, scenario-based range of roughly $378,000 to $724,000 in annual manager-run pre-tax EBITDA-style owner earnings, with a $538,000 base case. It is not an official Microtel profit claim. The range is anchored to the 2026 FDD’s median 2025 RevPAR for 24 qualified newly constructed hotels and an external U.S. hotel EBITDA margin benchmark.

The most important earnings driver is the combination of RevPAR and expense control, especially labor and distribution costs. The largest unresolved uncertainty is Microtel-specific operating expense and below-GOP ownership cost. A buyer should verify the Item 19 substantiation, obtain actual property-level P&Ls from comparable franchisees, and reconcile every fee and manager-cost assumption before treating any scenario as decision-grade.