HOMETOWNE STUDIOS BY RED ROOF
HomeTowne Studios, LLC franchises economy extended-stay hotels under brands like HomeTowne Studios by Red Roof, HomeTowne Studios & Suites by Red Roof, HomeTown Inn, and HomeTowne Inn, offering guest rooms with kitchenettes, on-site laundry, free Wi-Fi, vending, and business centers for extended stays, temporary housing, or transient visits. Franchisees can develop new builds or convert existing hotels, with options for dual-brand facilities alongside Red Roof Inn, following standardized designs and operations. The business model targets budget travelers in the extended-stay lodging market through franchise fees, royalties, and brand support.
Franchise Costs
5.5% royalty + 3% marketing & reservation fee + $490/mo base PMS fee (+ $3.85/room/mo) + $125-250/mo RediResponse fee
Financial Performance
Item 19 Financial Performance
Data Based On: Data for 39 Affiliate-Owned Hotels and 45 franchised Hotels open and operating for at least one year, for the period of January 1, 2024 through December 31, 2024.
* The document provides hotel performance metrics such as Daily Room Rate, Occupancy Rate, RevPAR (Revenue per Available Room), and Brand Contribution. RevPAR is defined as average revenue generated per day from each available room, not the total gross revenue per franchise unit (hotel). No data for total gross revenue, net income, net profit, EBITDA, or expense information was provided to allow for calculation of profit ranges.
Extracted Item 19 Section
How HOMETOWNE STUDIOS BY RED ROOF Compares
Key Insights
- #3 largest franchise system in Extended Stay
- One of the lowest SBA loan default rates in Extended Stay
| Franchise | Investment | Fee | Royalty | Locations |
|---|---|---|---|---|
HOMETOWNE STUDIOS BY RED ROOF Current | $10.7M – $13.2M | $30K | 5.5% | 45 |
| STUDIO 6 | $97K – $9.0M | $25K | 5.0% | 219 |
| HAWTHORN SUITES HOTELS AND HAWTHORN SUITES | $12.3M – $14.3M | $40K | 5.5% | 71 |
| Hyatt Studios | $12.0M – $21.5M | $50K | 5.0% | 45 |
| GRANDSTAY RESIDENTIAL SUITES | $125K – $24.2M | $35K | 5.0% | 30 |
| AFFORDABLE SUITES OF AMERICA | $193K – $1.8M | $35K | 5.0% | 18 |
Extended Stay Average 9 franchises | $7.6M – $14.7M | $38K | 5.2% | – |
* Comparison based on latest FDD filings. Investment ranges from Item 7, fees from Item 5. Showing top 5 of 9 Extended Stay franchises by location count.
Locations & Growth
Outlet Growth Over Time
Total outlets at end of each year
Geographic Distribution (2024)
Outlets by state across the United States
+3 more states
SBA Loan History
Historical SBA 7(a) loan data for HOMETOWNE STUDIOS BY RED ROOF franchisees (2021 – 2025)
Loans by Year
SBA 7(a) loan activity over time
* Data sourced from SBA 7(a) FOIA loan records. Default rate calculated from charged-off loans.
Due Diligence
Litigation (Item 3)
Bankruptcy (Item 4)
ASTECH Engineered Products, Inc. (prior employer of franchisor's General Counsel) filed Chapter 11 on July 15, 2022; plan of liquidation confirmed May 20, 2024.
System Health (Item 20)
Franchise system changes reported in the most recent fiscal year
Frequently Asked Questions
The total initial investment to open a HOMETOWNE STUDIOS BY RED ROOF franchise ranges from $10,719,393 to $13,157,291. This includes a franchise fee of $30,000. Ongoing royalty fees are 5.5% of gross sales.
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