How to Finance a Hyatt House Franchise: Extended-Stay Capital
By Marc Cornella
A Hyatt House franchise loan pays for an extended-stay hotel built around apartment-style suites, full kitchens and guests who may stay for days, weeks or longer. That residential design changes the budget, the operating model and the way a lender reads the projections, so it pays to understand the brand before you start assembling capital.
Below we cover the brand, the cost drivers, Hyatt’s fees, the SBA Franchise Directory listing and how owners combine SBA, conventional and equipment financing.
US Professional Funding is not affiliated with, sponsored by or endorsed by Hyatt House or Hyatt; the name is used only to describe the business. Figures from the franchisor’s disclosure document and the company’s public reports can change, loan programs and terms vary by lender and borrower, and every loan is subject to lender review and approval. Nothing here is legal, tax or investment advice; review the current Franchise Disclosure Document (FDD) and franchise agreement with a qualified franchise attorney and accountant before you commit.
Hyatt House Franchise Loan at a Glance
- Segment: an upscale, extended-stay brand in Hyatt’s Essentials portfolio, built around apartment-style suites with fully equipped kitchens.
- Size of the franchised system: Hyatt’s annual report for 2025 shows 17,031 franchised Hyatt House rooms and 3,365 managed rooms at year-end.
- Franchise fees: according to that report, Hyatt franchisees generally pay an initial application fee and/or a design services fee plus ongoing royalties; the Hyatt House amounts are in the brand’s FDD.
- Royalty: across Hyatt’s franchise agreements, typically a percentage of gross rooms revenues, typically ranging from 2.75% to 5%.
- Term: Hyatt’s standard franchise term is typically 20 years, and franchisees typically have the option of a 10-year successor agreement at expiration.
- Estimated initial investment: disclosed in Item 7 of the current Hyatt House FDD; Hyatt does not publish it on a public franchise page.
- SBA Franchise Directory: listed under code S2807, with an SBA-approved Hyatt Comfort Letter and a note on third-party management agreements.
What Is Hyatt House?
Hyatt unveiled Hyatt House in September 2011 as its new extended-stay brand, created by rebranding extended-stay hotels it already had in its system. When the name officially went up in January 2012, the company counted 53 Hyatt House hotels in 16 states, each offering studio, one-bedroom and two-bedroom suites with full kitchens.
Today, Hyatt’s annual report describes the brand as offering the space, comfort and convenience guests need to settle in, whether they are traveling for work, family or a life transition. Each hotel features apartment-style suites with fully equipped kitchens, living areas designed to feel like home and social spaces where guests can gather. Hyatt classifies the brand as upscale and lists its customer base as extended-stay guests, leisure and business travelers, and meetings.
The parent system. Hyatt, based in Chicago, reported 1,528 hotels and all-inclusive resorts with 372,763 rooms at the end of 2025, and its World of Hyatt loyalty program had approximately 63 million members. In January 2026 the company reported a record global pipeline of approximately 148,000 rooms, and said more than 80% of its U.S. pipeline represented new builds.
How the extended-stay model shapes a loan. Longer visits typically mean more multi-night bookings and less turnover per occupied room, which lenders tend to read as steadier revenue. The suites, however, are larger and costlier to build and furnish, so a Hyatt House franchise loan is underwritten on both points.
Hyatt House Franchise Costs
Hyatt does not publish Hyatt House fees or an investment range publicly; they are in the FDD you receive during the application process. Build your budget from Items 5, 6 and 7.
Application and design fees. Hyatt’s annual report says franchisees generally pay an initial application fee and/or a design services fee. Item 5 of the FDD gives the Hyatt House amounts, when they are due and whether any portion is refundable.
Land, site work and the building. For a ground-up hotel, land and vertical construction are the largest costs. Extended-stay suites are larger than a standard guest room and each one includes a kitchen, which adds plumbing, ventilation and electrical work per key.
FF&E and kitchens. Every suite needs furniture, bedding, lighting, televisions and a full kitchen package with appliances, cookware and dishware. Public spaces add lobby and lounge furnishings, breakfast service equipment, a fitness room, guest laundry and, at many properties, a pool and outdoor gathering space.
Opening costs and working capital. Operating supplies, hiring, training, pre-opening marketing and ramp-up cash round out the budget.
Expect the Hyatt House Item 7 table to cover categories such as:
- Initial application fee and design services fee
- Land purchase or ground lease payments
- Site work, construction and permits
- Architecture, engineering and design review
- Furniture, fixtures and equipment, including suite kitchens
- Operating supplies and equipment
- Technology, reservation and property management systems
- Signage
- Pre-opening sales, marketing, hiring and training
- Insurance, deposits and professional fees
- Additional funds for the initial operating period
Lenders add construction interest, financing costs and a contingency, then compare the total with an as-completed appraisal and stabilized cash flow.
Ongoing Fees and How They Affect Your Loan
Royalty. Hyatt reports that franchise royalties are typically a percentage of gross rooms revenues, typically ranging from 2.75% to 5% across its agreements. Some agreements are structured differently, so Item 6 of the Hyatt House FDD is the place to confirm the rate and any ramp-up schedule that applies to your hotel.
Brand program and system charges. Hotel franchisors generally charge separately for marketing, loyalty, reservations and technology. List each one in your projections rather than one blended percentage.
Management fees. Many owners hire a third-party management company. Its base fee and any incentive fee are deducted before a lender measures coverage, and the SBA directory note adds a specific review of that agreement for SBA loans.
Renovations and property improvement plans. Brand standards change over a long franchise term. Kitchens, soft goods and case goods in an extended-stay suite take steady use, so plan for periodic refreshes and a funded replacement reserve. Our article on financing a hotel PIP explains how owners pay for brand-required work.
How lenders weigh the fee load. Lenders subtract every franchise, management and reserve charge from a stabilized operating statement, then test whether the remaining income covers debt service with a margin, including under lower occupancy and rates.
Franchisor Requirements for New Owners
Hyatt does not publish a minimum net worth or liquidity requirement for Hyatt House. Its annual report notes that the company approves the plans for, and the location of, franchised hotels and reviews their operation, so approval centers on the owner group, the site and the project.
Owners should be prepared to show:
- Hotel development or ownership experience, held directly or brought in through partners, a developer or a management company.
- A site with extended-stay demand, such as corporate campuses, hospitals and medical centers, universities, military installations, project-based industries or relocation activity.
- A design that meets Hyatt House standards, reviewed through Hyatt’s design process.
- Equity and post-closing liquidity large enough to fund the project, absorb overruns and carry the hotel through stabilization.
- An operating plan covering self-management or a qualified third-party manager.
The usual sequence. Owners typically control a site, apply, review the FDD, sign the franchise agreement, complete design review and then close financing.
Ways to Own a Hyatt House
New construction. A ground-up Hyatt House is usually financed with a construction loan that converts to permanent debt once the hotel opens and stabilizes. Our hotel start-up loans page explains how we approach new builds and what a construction lender expects.
Buying an operating Hyatt House. An existing hotel brings operating history that simplifies underwriting. The buyer must be approved by Hyatt, typically signs a new franchise agreement and should expect a change-of-ownership PIP. Our hotel acquisition financing page and our walkthrough on how to buy a hotel cover the steps.
Converting an existing property. The original Hyatt House hotels were themselves rebranded, and an owner of a suitable suite-style hotel may apply to convert to the brand. The conversion PIP sets the cost, and lenders compare the property’s track record with its expected performance under the new flag. Learn more about franchise conversion financing.
Financing Options for a Hyatt House Franchise
SBA 7(a) loans. Because Hyatt House is on the SBA Franchise Directory, eligible borrowers can use an SBA 7(a) loan for acquisitions, construction, renovation, FF&E or working capital. The 7(a) program maximum is currently $5 million, so on a larger hotel it is often one piece of the capital stack rather than the whole loan.
SBA 504 loans. An SBA 504 loan is designed for owner-occupied real estate and long-lived assets, which can include hotel land, buildings and FF&E when program rules are met. It pairs a senior loan with a separate SBA-backed portion and the owner’s equity.
Conventional construction and permanent loans. Many Hyatt House projects use a conventional business loan, either construction-to-permanent or a permanent loan on an operating hotel, especially for sponsors with substantial equity and experience.
Equipment and FF&E financing. Suite kitchen packages, laundry equipment, fitness equipment, breakfast-area equipment and technology systems can be financed separately, preserving cash for construction, a PIP or reserves.
Working capital and lines of credit. A new hotel needs cash while occupancy builds, and an existing one needs a cushion for seasonal swings and renovation periods. See our hotel working capital options.
Seller financing on acquisitions. A seller may carry part of the price on an operating hotel. The note must be acceptable to the senior lender, is typically subordinate to it, and SBA and other loan programs may limit its terms.
SBA Loans for Hyatt House Franchisees
The SBA Franchise Directory lists brands whose franchise documents have been reviewed for eligibility. Each borrower still goes through normal credit underwriting.
Hyatt House’s directory listing. Hyatt House is listed under code S2807, with two notes.
Note 1: the Hyatt Comfort Letter. The SBA has approved the Hyatt Comfort Letter. A comfort letter generally gives the lender notice of franchise defaults, a chance to cure them and a path to keep the flag if the lender takes control of the hotel; the SBA-approved form needs no separate review.
Note 2: management agreements. If the applicant also operates under a management agreement with a third party, the lender must review that agreement under SBA rules to decide whether the applicant and the manager are affiliated. The applicant is not eligible if the management company is, or is affiliated with, the franchisor, and the SBA has not reviewed any Hyatt management documentation. In plain terms, an owner-operated or independently managed Hyatt House can qualify after that review; a hotel managed by Hyatt or one of its affiliates cannot use SBA financing.
Tips for an SBA application.
- Choose your management approach early and give the lender the full management agreement.
- Request the comfort letter as soon as the franchise agreement is signed.
- Size the request to the full project, including FF&E, PIP work and working capital, and show where other capital fills any gap.
- Model the payment with our SBA loan calculator before you settle on a loan amount.
How Lenders Evaluate a Hyatt House Deal
Credit, net worth and liquidity. Lenders review the principals’ credit, tax returns and personal financial statements, typically require personal guarantees and want proof of equity and post-closing cash to cover overruns, delays and a slower ramp.
Hotel and management experience. Prior hotel ownership or development carries significant weight.
Business plan and projections. The plan should identify the extended-stay demand drivers in your market, the expected mix of short and long stays, rate and occupancy through ramp-up, every franchise and management fee, and a replacement reserve sized for suites with kitchens.
The FDD and franchise agreement. Lenders read the term, successor rights, transfer and termination provisions, liquidated damages, PIP obligations and the comfort letter. Item 10 shows whether Hyatt offers any financing, and Item 19 shows whether the FDD includes financial performance representations.
Site and real estate. Expect an appraisal, title, environmental and survey work and, for new builds, review of the construction contract, budget and contractor.
Historical financials on a resale. Buyers provide several years of operating statements, tax returns and brand quality results.
Suites, Kitchens and FF&E Planning
Each Hyatt House suite works like a small apartment, with seating, dining and work surfaces and a kitchen with appliances, cabinetry, cookware and dishware. That makes FF&E a bigger share of the budget than in a standard hotel.
Financing and replacing the package. FF&E can be included in a 7(a), 504 or construction loan or financed separately; matching each term to the item’s useful life avoids paying for furniture after it is gone. Because kitchens and soft goods wear faster when guests stay longer, a replacement schedule and funded reserve show a lender that a future PIP will not strain the loan.
Multi-Unit Growth and Development Agreements
Each additional hotel is typically financed as its own project with its own appraisal and loan. Strong results at your first Hyatt House can support the next, but lenders also check combined debt and whether the new loan leaves the portfolio thin on cash. Our article on multi-unit franchise financing explains how portfolio lending works.
Development commitments. If Hyatt offers multi-property rights in your market, never commit to a schedule faster than you can fund each hotel.
Real-World Scenarios
A first-time developer near a medical district. A real estate group with no hotel history partners with a management company to build near a hospital campus. The lender focuses on the manager’s record, the demand study and the construction contingency.
An existing owner buying a stabilized Hyatt House. An operator with several branded hotels acquires an operating Hyatt House. The lender underwrites the hotel’s historical results, the change-of-ownership PIP and seller financing that sits behind the senior loan.
A conversion of a suite-style hotel. An owner of an independent all-suite property applies to convert it. Financing covers the purchase or refinance plus the conversion PIP, and the lender compares current results with projections under the Hyatt House flag.
Common Mistakes to Avoid
- Budgeting from a standard hotel room cost instead of pricing full-kitchen suites.
- Skipping a demand study for extended-stay guests in your market.
- Signing a management agreement before confirming it works for SBA eligibility.
- Leaving out reserves for future PIPs and kitchen replacements.
- Underestimating the cash needed to carry the hotel through ramp-up.
Read more in our article on hotel loan mistakes to avoid.
Next Steps to Finance Your Hyatt House Franchise
Step 1: Request the FDD. Get the current Hyatt House FDD and review Items 5, 6, 7, 10, 17 and 19.
Step 2: Identify a site or hotel. Choose land, an operating Hyatt House or a conversion candidate with documented extended-stay demand.
Step 3: Build the project budget. Combine Item 7, construction or PIP bids, FF&E quotes, financing costs and working capital.
Step 4: Decide how the hotel will be managed. Settle on self-management or a third-party manager and, for SBA loans, confirm the agreement passes the affiliation review.
Step 5: Prepare projections and a business plan. Show demand drivers, rate and occupancy assumptions, every fee and a replacement reserve.
Step 6: Assemble documents. Gather financial statements, tax returns, entity papers and the franchise agreement.
Step 7: Talk to a financing specialist. Compare options for your Hyatt House franchise loan.
Hyatt House Franchise Loan FAQs
How much does it cost to open a Hyatt House?
Hyatt does not publish the estimated initial investment publicly. The total appears in Item 7 of the Hyatt House FDD and depends heavily on land, construction costs, suite count and whether you are building new, buying or converting.
What is the Hyatt House franchise fee?
Hyatt’s annual report says franchisees generally pay an initial application fee and/or a design services fee. The specific Hyatt House amounts are in Item 5 of the FDD.
What royalty does Hyatt House charge?
Hyatt reports that royalties under its franchise agreements are typically a percentage of gross rooms revenues, typically ranging from 2.75% to 5%. Item 6 of the FDD gives the rate for a Hyatt House.
How much net worth or liquidity do I need?
Hyatt does not publish a minimum; the project’s equity requirement and the lender’s liquidity expectations usually decide it.
Is Hyatt House eligible for SBA loans?
Yes. Hyatt House is on the SBA Franchise Directory under code S2807. The listing notes an SBA-approved Hyatt Comfort Letter and requires a lender review of any third-party management agreement; hotels managed by Hyatt or its affiliates are not eligible.
Can I buy an existing Hyatt House?
Yes, with Hyatt’s approval. Buyers usually sign a new franchise agreement and complete a change-of-ownership PIP, and lenders underwrite the hotel’s historical financials.
Can a first-time hotel owner get a Hyatt House franchise loan?
It is possible, though hotel experience is weighed heavily; many first-time owners partner with an experienced operator or manager.
Can I finance suite kitchens and furniture separately?
Yes. FF&E can be part of an SBA or conventional loan or financed separately through equipment financing.
Does Hyatt offer franchise financing?
Item 10 of the FDD discloses whether Hyatt or an affiliate offers any financing to Hyatt House franchisees.
How long is a Hyatt House franchise agreement?
Hyatt’s annual report says its standard franchise term is typically 20 years, with franchisees typically having the option to enter a 10-year successor agreement. Item 17 of the FDD gives the Hyatt House terms.
Final Thoughts
Hyatt House offers an upscale extended-stay brand backed by a large loyalty program, but its suites, kitchens and long franchise term make it capital intensive. Careful planning of FF&E, management and reserves puts owners in a stronger position with lenders.
US Professional Funding helps hotel owners and franchise buyers compare SBA, conventional and equipment financing. Learn more on our franchise financing page and our hotel and motel financing page.
