GrandStay Hospitality

The ad fund rate of 2.0% is below the typical 2.25-3.5% for hospitality franchises. How is the advertising fund allocated, and what specific marketing initiatives or ROI can franchisees expect from this contribution?

Transfer fees of $5,000 are significantly lower than the typical range of $12,500-$50,000. Are there additional transfer-related costs or conditions not reflected in this fee, and what is the franchisor's approval process for unit transfers?

The one-year turnover rate of 13.3% and three-year rate of 29.0% substantially exceed typical ranges. Can you identify the primary reasons franchisees are exiting, and what percentage of closures were due to economic performance versus other factors?

With 9 unit closures over 3 years and only 3 terminations, what operational or market challenges contributed to voluntary closures, and how does the franchisor support underperforming units?

Termination rate of 6.7% is significantly above typical ranges. What specific violations or non-compliance issues triggered terminations, and were any disputes resolved through litigation or settlement rather than formal termination?

The renewal term of 20 years is double the typical 5-10 year range, and the total potential term of 40 years is unusually long. What conditions trigger renewal eligibility, and can renewal terms be renegotiated regarding fees, royalties, or other material terms?

Only 11 termination causes are defined compared to the typical 14.5-16.0. What specific behaviors or conditions allow the franchisor to terminate the franchise agreement, and are there remediation opportunities before termination?

Despite zero litigation cases in the franchisor's history, the system shows high unit turnover and terminations. Have disputes been resolved through arbitration, mediation, or settlement agreements rather than court litigation?

The investment score of 89/100 is well above typical (59-81), but the system health score of 27/100 is critically low compared to typical (50-68). How does the franchisor explain this disconnect between favorable initial investment terms and poor system health metrics?

Unit count has remained essentially flat (31 to 30 units) despite the 29.0% three-year turnover rate. Does this indicate that new unit sales offset closures, and what are the franchisor's unit growth projections for the next 3-5 years?

The franchise does not require a non-compete period (0 years/0 miles) upon exit or non-renewal. Can former franchisees immediately compete with GrandStay, and has this lack of non-compete protection been a factor in franchisor litigation or disputes?

The renewal fee calculation is the greater of 25% of the initial franchise fee or a stated amount. For a $35,000 initial fee, what is the exact renewal fee amount, and are there any escalators or increases applied in subsequent renewal periods?

Transfer fee is $5,000, but what fees or costs apply if the franchisor itself terminates or does not renew the agreement—specifically regarding transition support, property disposition, or holdover provisions?

The personal guarantee required from franchise owners does not extend to spouses. If a spouse is involved in operations or sign leases, what liability or indemnification obligations does that spouse assume?

With a 20-year renewal term available, what are the actual odds of renewal approval, what percentage of franchises exercise renewal options, and how many renewals has the franchisor actually approved historically?

The support and training score is 100/100, above typical ranges (73-86). What specific training and ongoing support is provided, and how does this compare to competitor offerings in the hospitality space?

In 2024, the system recorded 4 closures, 2 terminations, 3 transfers, and 2 other cessations—the highest exit year on record. Was there a specific triggering event (market downturn, policy change, litigation) that explains the elevated exits in that year?

The franchisor has no non-compete clause post-exit, yet the territory is exclusive during the term. If a franchisee's license is terminated, can the franchisor immediately franchise that territory to a competitor or operate it themselves?

Financial Performance data is not disclosed (no Item 19). Can the franchisor provide actual financial performance data (revenue, profitability, occupancy rates) for comparable units, and are there any earnings claims available in the franchise disclosure document?

Given the 13.3% annual turnover rate, what is the average lifespan of a GrandStay franchise, and what percentage of franchisees have owned units for the full 20-year initial term?