Franchise Deep Dive: Courtyard by Marriott Franchise Costs, Fees, Profit and Data

REPORTED COST TO GET IN: $11,131,210 to $28,763,410

REPORTED ROI (Item 19): $150.57 average room rate, 67.4% average occupancy rate and $101.49 average RevPAR

Courtyard by Marriott is a brand of hotels owned by Marriott International, one of the world’s leading lodging companies. The Courtyard by Marriott series of lodgings is designed primarily for business travelers, with large desks, couches and internet access. Other areas accommodate families. Most Courtyard locations have full-service restaurants, as well as 24-hour mini-marts.

The first Courtyard by Marriott hotel was built in 1983 in Atlanta. Courtyard was Marriott’s first sister brand and was launched to target mainly business travelers who wanted quality service at reasonable prices. Marriott spent $2 billion to build the Courtyard by Marriott chain, seeking market share with Holiday Inn and other chain customers.

Since the brand launch and subsequent success, Courtyard by Marriott has pivoted to accommodate families and leisure travelers, as well as business travelers, adding swimming pools, fitness centers, microwave ovens and mini-refrigerators in rooms, and offering family rates.

Courtyard by Marriott now has more than 700 locations worldwide.

Features of Courtyard by Marriott hotels include:

• 80 to 150 guest rooms

• High-speed Internet access

• Restaurant, lounge

• Meeting space

• Central courtyard

• Exercise room

• Swimming pool

• 24-hour access to food

A redesigned lobby for Courtyard by Marriott debuted in 2008 and includes a revamped restaurant/bar area called The Bistro; a business center with more computers and seating; a modernized lounge and seating area; expanded areas for a mini-mart; a touchscreen info center called the GoBoard; and a redone front desk area with pedestals instead of traditional counter space.

The chart below, taken from Item 19 of Courtyard by Marriott’s 2023 FDD, shows the performance of STR Included Hotels (defined below) during each of the four calendar years in the period ended December 31, 2022, including: (1) the average daily room rate (ADR); (2) the average occupancy rate (OCC); and (3) the average revenue per available room (RevPAR) reported by the STR Included Hotels.

The ADR for each respective period is the sum of the gross room sales reported by the STR Included Hotels during the period, then divided by the total number of guestrooms reported as sold by the STR Included Hotels during the period. The OCC for each respective period is the total number of guestrooms reported as sold by the STR Included Hotels during the period, then divided by the total number of guestrooms reported as available at the STR Included Hotels during the period. The RevPAR for each respective period is the gross room sales reported by the STR Included Hotels during the period, then divided by the total number of available rooms reported by the STR Included Hotels as available during the period.

According to Item 7 in Courtyard by Marriott’s 2023 Franchise Disclosure Document (FDD), the total investment necessary to begin operation of a newly constructed prototypical Courtyard by Marriott hotel, excluding the cost of real estate and related costs (building permit, tap and impact fees), insurance and contingencies, ranges from $14,087,810 to $31,263,910 for an 80- to 110-room Courtyard by Marriott hotel to $18,995,310 to $38,276,610 for a 120- to 150-room Courtyard by Marriott hotel. This includes approximately $161,300 to $241,200 that must be paid to the franchisor or an affiliate.

The initial franchise fee is $90,000.

• Anthony Capuano — President and Chief Executive Officer

• Erika Alexander — Chief Global Officer, Global Operations

• Satya Anand — President, Europe, Middle East & Africa (EMEA)

• Ty Breland — Executive Vice President and Chief Human Resources Officer

• Liam Brown — Group President, United States and Canada

• Don Cleary — President, Canada

• Jim Connelly — President, U.S. Eastern Region, Full-Service Hotels

• Jim Dausch — Chief Product Officer, Global Technology

• Tina Edmundson — President, Luxury

• Carlton Ervin — Global Development Officer, International

• Karen Finberg — Chief Franchise Officer

• Brian King — President, Caribbean & Latin America (CALA)

• Yibing Mao — President, Greater China

• Raj Menon — President, Asia Pacific Excluding China (APEC)

• Carla Murray — President, US Full Service Western Region

• Leeny Oberg — Chief Financial Officer and Executive Vice President, Development

• Drew Pinto — Executive Vice President and Chief Revenue & Technology Officer

• Tricia Primrose — Executive Vice President and Chief Global Communications & Public Affairs Officer

• Rena H. Reiss — Executive Vice President and General Counsel

• Peggy Roe — Executive Vice President and Chief Customer Officer

• Noah Silverman — Global Development Officer, US & Canada

• Jim Scholefield — Global Chief Information & Digital Officer

• Marriott Hotel Arrives On Capitol Hill Opening Its Newest Property In The Heart Of The Nation’s Capital

• Courtyard By Marriott Hotel To Open In Portland, Oregon

• Marriott International Marks Another Year of Strong Year

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