How to Start a Red Lion Hotel Franchise in 7 Steps: Checklist

Official brand information describes both Red Lion formats as conversion- and new-build-friendly. The full-service path is Red Lion Hotels By Sonesta; the select-service path is Red Lion Inn & Suites By Sonesta. The controlling pre-opening obligations, however, come from the 2026 FDD and the agreements attached to it.

The 2026 FDD does not publish a universal minimum net worth, liquidity threshold, credit score, hotel-experience requirement, education requirement, or citizenship requirement for these Red Lion offers. The public Sonesta development inquiry asks for contact details, intended property scale, brand interest, current property name or “New Build,” guest-room count, and city, but meeting any stated project profile does not guarantee approval.

Ownership and operating structure become concrete contract issues. If the franchisee is an entity, each direct or indirect owner with at least a 20% ownership interest must sign the required guaranty. The owner is not required to manage the Hotel personally; if the owner or Principal does not do so, an approved Management Company must be retained, its management agreement requires prior written approval, and the Management Company must sign the Management Company Joinder. 2026 FDD, Item 15, pp. 60–61.

Federal disclosure timing sits before the binding agreement and payment stage. Under the FTC Franchise Rule, the prospective franchisee must receive the FDD at least 14 calendar days before signing a binding agreement with, or paying money to, the franchisor or an affiliate in connection with the franchise sale. The FTC also explains that an applicant may request the FDD once the franchisor has received the application and agreed to consider it. See the FTC Consumer’s Guide to Buying a Franchise and the FTC Franchise Rule page.

For a conversion, one pre-signing payment trigger is unusually important: the 2026 FDD states that the PIP Fee, up to $5,000, is paid before execution of the Franchise Agreement for the initial inspection, preparation of the Property Improvement Plan, and verification of PIP completion. The Initial Fee is due when the Franchise Agreement is signed and is described as fully earned and non-refundable, unless Sonesta permits an installment arrangement documented by the Initial Fee Promissory Note. 2026 FDD, Item 5, pp. 15–18; Item 10, pp. 43–44.

1. Submit the development inquiry

   Action: Identify the proposed brand, property or new-build status, room count, and market.
   Actor: Applicant.
   Timing: No contractual application duration is disclosed.
   Next dependency: Sonesta must decide to continue evaluating the prospect and property.

2. Receive and review the current FDD

   Action: Review the 23 Items, Franchise Agreement, guaranty, and applicable riders before signing.
   Actor: Applicant; disclosure supplied by franchisor.
   Timing: At least 14 calendar days before a binding agreement or covered payment.
   Blocker: A rushed or incomplete disclosure process should not be treated as satisfying the federal timing rule.

3. Complete property diligence and sign the correct agreement package

   Action: For a conversion, complete the initial inspection and PIP process; then execute the Franchise Agreement and the applicable Conversion Rider or New Construction Rider.
   Actor: Applicant/franchisee and Sonesta RL Hotels Franchising Inc.
   Timing: The conversion PIP fee is due before execution; the Initial Fee is generally due at signing, and Exhibit A sets the Required Opening Date.
   Blocker: Unresolved property terms, guaranties, payment arrangements, or individualized Exhibit A dates can prevent the project from moving into development.

4. Prove control of the premises

   Action: Deliver a deed or qualifying lease; provide later lease modifications when required.
   Actor: Franchisee, landlord, lender, or seller as applicable.
   Timing: No later than 30 days after the Franchise Agreement effective date under both riders.
   Blocker: Failure to provide the deed or lease on time permits immediate termination under the riders.

5. Obtain approvals, permits, insurance, and complete the physical work

   Action: Submit Plans and Designs, secure required government approvals, carry builder’s risk during work, and complete the PIP or Construction Work to Brand Standards.
   Actor: Franchisee and third-party professionals; Sonesta reviews for brand compliance.
   Timing: Conversion dates come from the PIP; new construction must start within 12 months and open within 24 months unless Exhibit A specifies otherwise.
   Blocker: Financing inability and permit inability are expressly excluded from the riders’ Force Majeure definition.

6. Install the required hotel systems and approved supplies

   Action: Implement the approved PMS, designated RMS, CRS connectivity, payment security, required Wi-Fi and other specified systems; source required signage, FF&E, OS&E, and other supplies under Brand Standards.
   Actor: Franchisee, Approved Suppliers, and technology vendors.
   Timing: Insurance certificates are due within 10 days after signing; unapproved-supplier review typically takes about 30 days but has no guaranteed response deadline.
   Next dependency: The Computer System must be installed to standards before opening authorization.

7. Finish onboarding, staffing, and training

   Action: Provide onboarding information for CRS setup, hire and train hotel staff, and complete initial brand training for one Hotel Representative.
   Actor: Franchisee; Sonesta provides the initial brand program.
   Timing: Training is normally pre-opening; the FDD also permits completion within 90 days of system activation where Sonesta agrees in writing to post-opening completion.
   Blocker: Failure to complete training to Sonesta’s satisfaction can support termination.

8. Obtain written authorization and open

   Action: Satisfy Brand Standards, licenses and permits, development obligations, staffing, technology, payment, insurance-documentation, and other requested-document conditions.
   Actor: Franchisee completes conditions; Sonesta gives written authorization.
   Timing: By the individualized Required Opening Date on Exhibit A.
   Blocker: Opening before written authorization is treated as unauthorized use of the Marks and a material breach.

One Hotel Representative must complete the initial brand training program to Sonesta’s satisfaction. The program is offered virtually, at the Hotel, or at another designated location, and the FDD estimates 18–33 classroom hours with no on-the-job hours in the disclosed curriculum. Sonesta offers it as needed based on trainer and attendee availability. 2026 FDD, Item 11, pp. 50–52.

The Franchise Agreement separates physical completion from permission to open. Section 2.E requires written notice that the Hotel meets Brand Standards, applicable licenses and permits, compliance with training and brand-introduction requirements unless a written post-opening exception is granted, trained staff, completed development obligations, an installed compliant Computer System, full payment of the Initial Fee and other due amounts, and requested documentation including insurance certificates.

Before relying on a target opening date, obtain the completed Exhibit A, the correct rider, and the project-specific PIP or construction schedule. Confirm the Required Opening Date, construction or renovation commencement and completion dates, the exact approved Guest Room count, premises documentation deadline, management-company approvals, technology lead times, insurance requirements, and which requested documents Sonesta expects before written authorization.

For market rights, treat the FDD and Franchise Agreement as controlling and ask for written clarification of any location-specific competitive protections. For a conversion, confirm every PIP line item and whether a reinspection is expected. For a new build, confirm whether Exhibit A changes the default 12-month construction-start or 24-month opening deadlines. For an acquisition, reconcile Sonesta’s transfer consent requirements with the seller’s existing agreement before setting the closing date.

The FDD also provides current and former franchisee information in Item 20, which can be used to ask how long real conversions, new builds, technology onboarding, and written opening authorization took in comparable markets. That is due-diligence evidence, not a substitute for the contractual schedule that applies to the buyer’s own Hotel.