How to Finance a Moxy Hotels Franchise: Build Costs and Fees
By Chris Cornella
A Moxy Hotels franchise loan is a hotel development or conversion loan first and a franchise loan second. Moxy is a design-centric, select-service brand, and its 2025 Franchise Disclosure Document (FDD) estimates an initial investment of $15,074,510 to $39,712,110 for a 100 to 150-room hotel, before land, insurance and contingencies.
This article covers how a Moxy Hotels franchise loan is sized: the brand’s concept, the application fee and other Item 5 charges, ongoing royalty and program fees, how lenders size a Moxy deal, the brand’s SBA Franchise Directory note on management agreements and the financing structures owners typically consider.
US Professional Funding is not affiliated with, sponsored by or endorsed by Moxy Hotels; the name is used only to describe the business. Figures from the franchisor’s disclosure document can change, loan programs vary, and every loan is subject to approval. Nothing here is legal, tax or investment advice; review the current FDD and franchise agreement with a hotel franchise attorney and accountant.
Moxy Hotels Franchise Loan at a Glance
- Franchisor: MIF, L.L.C., a Delaware limited liability company, according to the 2025 FDD issued March 31, 2025.
- Concept: design-centric, select-service hotels; the concept was developed in 2013 and franchising began in 2014.
- System size: 43 franchised Moxy hotels operating in the U.S. and Canada as of December 31, 2024, plus one operated by the franchisor and its affiliates.
- Application fee: $90,000 plus $500 per guestroom above 150 guestrooms for a new-to-system hotel.
- Royalty: 5.5% of gross room sales.
- Program services contribution: 3.85% of gross room sales (including a 2.5% marketing fund contribution), plus $7,000 per year and $135 per guestroom per year.
- Estimated initial investment: $15,074,510 to $39,712,110 for 100 to 150 rooms, and $22,320,710 to $48,675,410 for 151 to 200 rooms, excluding real estate, insurance and contingencies.
- SBA Franchise Directory: listed as Moxy Hotels under code S1135, with a note on management agreements.
What Is Moxy Hotels?
According to the 2025 FDD, Moxy hotels are design-centric, select-service properties. The franchisor, MIF, L.L.C., was established in 2012 and is a subsidiary of its parent hotel company. The Moxy concept was developed in 2013, and the franchisor began offering Moxy franchises in 2014.
As a select-service brand, Moxy does not carry the full restaurant and meeting operations of a full-service hotel, and its design-centric positioning puts weight on public spaces and branded finishes. Projects in urban or high-demand locations face higher land and construction costs.
System size. The FDD reports 43 franchised Moxy hotels operating in the U.S. and Canada at the end of 2024, along with one hotel operated by the franchisor and its affiliates. That is a smaller domestic footprint than many established select-service brands, which lenders weigh when they look for comparable properties.
Why lenders view it the way they do. Lenders see the backing of a large hotel system, its reservation and loyalty platforms and a recognizable lifestyle positioning. At the same time, urban and infill projects carry high construction costs per key, so lenders focus heavily on the sponsor’s development experience, the construction budget and the local demand story.
Moxy Hotels Franchise Costs
Application fee. For a new-to-system Moxy hotel, the 2025 FDD sets the application fee at $90,000 plus $500 per guestroom in excess of 150 guestrooms. For certain existing hotels, including an existing Moxy or a conversion of a hotel the franchisor or an affiliate manages, the fee is the greater of $200,000 or $500 per guestroom.
Pre-opening training and onboarding. The FDD lists pre-opening training and services generally costing $50,000 to $86,000, a franchisee orientation program with a $40,000 enrollment fee and a new-development onboarding program with a $20,000 enrollment fee. Where they apply, the FDD also lists a $60,000 relicensing orientation fee and a $20,000 program fee due at signing.
Procurement and design. If you use the franchisor’s procurement services, charges are the greater of $3,500 or about 4.5% to 5% for furniture, fixtures and equipment, and the greater of $7,500 or about 4.5% to 5% for opening operating supplies. Additional hotel design assessments cost $1,500 each, and fire and life safety inspections by the franchisor run $500 to $19,500 depending on the criteria.
Third-party fee. The FDD also lists a fee of 100,000 to 200,000 euros payable to an unrelated third party, which the franchisor said it would pay for franchise agreements signed on or before March 30, 2026. Ask whether that arrangement applies to your agreement.
Total investment. The 2025 FDD estimates the total initial investment, excluding real estate, insurance and contingencies, at:
- 100 to 150-room Moxy hotel: $15,074,510 to $39,712,110
- 151 to 200-room Moxy hotel: $22,320,710 to $48,675,410
- Amounts paid to the franchisor or an affiliate: roughly $172,300 to $282,200 of the total
The rest of the investment covers construction, furniture, fixtures and equipment, technology, signage, opening supplies, pre-opening expenses and working capital. Read the full Item 7 table in the current FDD for each line item, and remember that land acquisition is not included.
Ongoing Fees and How They Affect Your Loan
Royalty. The 2025 FDD lists a royalty of 5.5% of gross room sales, as set in the franchise agreement. The FDD notes that owners may qualify for a temporary reduction under development incentive programs described in Item 10.
Program services contribution. Owners pay 3.85% of gross room sales, which includes a 2.5% marketing fund contribution, plus $7,000 per year and $135 per guestroom per year.
Loyalty program charges. The FDD lists a loyalty program charge of 1.55% of qualifying revenue, reduced to 1.45% through December 2027, plus 1% of qualifying event revenue for select group and catering events, capped at $300 per event.
PIP-related fees. The FDD lists a $12,000 property improvement plan (PIP) review fee, $5,000 for a revision review, $6,000 to refresh a PIP 12 months after issuance and $12,000 for a new PIP at 24 months. PIPs are effective for 12 months after issuance.
How lenders factor these in. Royalty, program services and loyalty charges are revenue-based, so lenders deduct them before calculating net operating income and debt service coverage. Fixed per-room charges matter more for smaller hotels, and the per-room technology and system costs can exceed the FDD estimates depending on room count and interfaces.
Franchisor Requirements for New Owners
The 2025 FDD sections reviewed for this article did not state a minimum net worth or liquidity requirement for Moxy owners. In practice, the franchisor evaluates each hotel project and ownership group, and approval depends on the site, the market and the developer’s experience and capital.
- Development experience: a new-build Moxy is a commercial construction project, and both the franchisor and lenders will look for a team that has delivered hotels before.
- Capital: equity must cover the gap between total project cost and the loan, plus reserves for cost overruns.
- Training: owner and management training programs are required as listed in Item 5.
- Management: owners can self-manage or hire a qualified management company, subject to franchisor approval and the SBA note discussed below.
The approval process. Owners submit an application with site and market details, pay the application fee and, once approved, sign the franchise agreement and move through design review, construction and pre-opening inspections. Lenders typically want the franchisor’s approval or a comfort letter before closing.
Ways to Own a Moxy Hotel
New construction. A new-build Moxy is a ground-up development. Financing typically combines construction debt with a permanent loan or an SBA structure, and lenders underwrite projections, the construction budget and the sponsor’s track record. Our page on hotel start-up financing explains how these deals come together.
Conversion of an existing building. The FDD’s different fee formula for existing hotels shows that conversions and relicensing are part of the system. Converting an existing building or hotel to Moxy standards usually requires a PIP and extensive renovation. Read more about financing a hotel PIP.
Buying an existing Moxy hotel. Buyers of an operating Moxy can underwrite actual revenue and expenses, but they should expect a relicensing review, a PIP and the relicensing fees in Item 5. See our hotel acquisition financing options.
Moxy Hotels Franchise Loan Options
SBA 7(a) loans. Because Moxy is on the SBA Franchise Directory, an SBA 7(a) loan may fit smaller projects, acquisitions or parts of a larger capital stack. The SBA 7(a) program maximum is currently $5 million, though program rules can change, so it usually covers only part of a Moxy development.
SBA 504 loans. For owner-occupied hotel real estate, an SBA 504 loan pairs a senior lender with a certified development company loan for land, building and long-lived equipment. Hotels can suit the 504 structure because the property is the business.
Conventional construction and term loans. Many Moxy projects use conventional business loans: a construction loan during the build that converts or is refinanced into permanent financing once the hotel stabilizes. Lenders look at loan-to-cost, debt service coverage and sponsor strength.
FF&E financing. Guestroom furniture, lobby and bar fixtures, technology, kitchen and bar equipment and fitness equipment can sometimes be financed separately, which can preserve equity for construction.
Working capital and lines of credit. Pre-opening payroll, training, marketing and the ramp-up period before occupancy stabilizes all need cash. See our hotel working capital options.
Seller financing on acquisitions. When buying an existing hotel, a seller may carry part of the price. A seller note is typically subordinate to the senior loan, and loan programs may limit its terms.
SBA Loans for Moxy Hotels Franchisees
SBA lenders generally require a brand to appear on the SBA Franchise Directory before making an SBA-guaranteed loan to one of its franchisees. A listing does not approve a borrower; it confirms that the franchise relationship has been reviewed. Our article on SBA loans for hotels covers the broader rules.
Moxy’s directory listing. Moxy Hotels is listed on the SBA Franchise Directory under code S1135. The listing carries a note: if the applicant also operates under a management agreement with a third party, the lender or CDC must review that agreement under SBA rules to decide whether the applicant and the management company are affiliated. The applicant is not eligible if the management company is, or is affiliated with, the franchisor.
What that note means in plain English. Many hotel owners hire a professional management company. If you do, the lender will read the management agreement to see whether the manager effectively controls the business. And if the manager is the franchisor or one of its affiliates, an SBA loan is not available for that hotel. Owners who plan to use franchisor management should plan on conventional financing.
SBA application tips. For an SBA-backed Moxy Hotels franchise loan, prepare a feasibility study, construction budget and timeline, the franchise application and approval, the proposed management agreement, the sponsor’s hotel track record and projections that include all Item 6 fees.
How Lenders Evaluate a Moxy Hotels Deal
Personal credit and financial history. Lenders review the credit, tax returns and personal financial statements of each guarantor.
Net worth and liquidity. For a project of this size, lenders look for substantial equity and post-closing liquidity to cover overruns and the ramp-up period. Our article on hotel loan requirements explains typical expectations.
Industry and management experience. Prior hotel development and operating experience carries significant weight. If you are newer to hotels, a seasoned management company and a general contractor with hotel experience help offset that.
Business plan and projections. A third-party feasibility study is usually required. Projections should reflect local occupancy and rate trends, the lobby and bar revenue mix, staffing for a select-service model and every revenue-based fee in the FDD.
The FDD and franchise agreement. Lenders review the fee structure, the term, termination provisions and any development incentives. Check Item 17 of the current FDD for the term and renewal conditions. Our guide to how lenders read an FDD covers what to highlight.
Site and real estate. Lenders evaluate land cost, zoning, entitlements, construction pricing and the appraised value on completion.
Historical financials for existing hotels. For acquisitions, expect to provide several years of operating statements and the current PIP.
FF&E, Design and PIPs
Moxy’s design standards drive a large share of the budget. Lobby and bar build-outs, branded guestroom packages, signage and technology must meet brand specifications, and the franchisor’s design review and procurement services add their own charges.
Reserves. Hotel lenders usually require an FF&E reserve funded from operations to keep the property current. Over time, the franchisor can require renovations, and a sale or relicensing typically brings a PIP. Budget for both from day one.
Multi-Unit Growth and Development
Hotel developers often build portfolios across several brands and markets. For a second Moxy, lenders will look at the first hotel’s performance and the sponsor’s liquidity after both projects. Each hotel generally requires its own application, franchise agreement and fees, and development incentives described in Item 10 may apply to some agreements.
Financing a second hotel. Some developers refinance a stabilized first hotel to free equity for the next project. Others use separate construction loans for each property to keep risks isolated.
Real-World Scenarios
An experienced developer building a new Moxy. A developer with several select-service hotels secures a downtown infill site, obtains franchise approval and closes a construction loan that converts to permanent debt after stabilization, with FF&E financed separately.
A conversion of an office building. An investor converts a vacant urban office building into a Moxy, funding the purchase and renovation with conventional debt and a PIP budget approved by the franchisor.
An owner using third-party management. An owner-operator seeks an SBA 504 loan and hires an independent management company. The lender reviews the management agreement for affiliation before approval.
Acquiring an operating Moxy. A buyer acquires an existing hotel, pays the relicensing fees, completes the PIP and finances the purchase and renovation together. Explore our conventional loan calculator for early estimates, which are for planning only.
Common Mistakes to Avoid
- Budgeting from the FDD total without adding land, insurance and contingency costs
- Assuming an SBA loan will cover a large share of a Moxy development
- Choosing franchisor-affiliated management and expecting SBA eligibility
- Ignoring the per-room and fixed annual charges in the program services contribution
- Underfunding pre-opening and ramp-up working capital
- Missing PIP timelines and paying for refreshed or new PIPs
For more hotel pitfalls, read common hotel loan mistakes.
Next Steps to Finance Your Moxy Hotels Franchise
Step 1: Assemble your team. Bring together a hotel-experienced architect, general contractor, management company, franchise attorney and accountant.
Step 2: Secure a site and feasibility study. Confirm the market supports a Moxy and that the site works for the brand’s design standards.
Step 3: Apply to the franchisor. Submit the application, pay the application fee and review the current FDD in detail.
Step 4: Build the budget. Price construction, FF&E, technology, fees, pre-opening costs and working capital, then add contingency.
Step 5: Choose the financing structure. Compare conventional construction and permanent loans, SBA 504 and SBA 7(a) options with a financing specialist.
Step 6: Close and build. Close the loan, complete construction and inspections, train your team and open.
Moxy Hotels Franchise Loan FAQs
How much does it cost to build a Moxy hotel?
The 2025 FDD estimates $15,074,510 to $39,712,110 for a 100 to 150-room hotel and $22,320,710 to $48,675,410 for a 151 to 200-room hotel, excluding real estate, insurance and contingencies.
What is the Moxy application fee?
For a new-to-system hotel, the fee is $90,000 plus $500 per guestroom above 150 guestrooms. Certain existing hotels pay the greater of $200,000 or $500 per guestroom.
What royalty does Moxy charge?
The 2025 FDD lists a royalty of 5.5% of gross room sales, plus a program services contribution of 3.85% of gross room sales, $7,000 per year and $135 per guestroom per year.
Can I get an SBA Moxy Hotels franchise loan?
Yes, if you qualify. Moxy Hotels is listed on the SBA Franchise Directory under code S1135. The applicant is not eligible if its management company is, or is affiliated with, the franchisor.
How much net worth or liquidity do I need?
The FDD sections reviewed did not state a minimum. Expect both the franchisor and lenders to require substantial equity and post-closing liquidity relative to the size of the project.
Does Moxy offer financing?
The FDD refers to development incentive programs in Item 10 that may temporarily reduce the royalty. Review Item 10 of the current FDD for the specifics, and plan on outside financing for construction.
Can I convert an existing hotel to a Moxy?
The FDD provides a separate fee formula for existing hotels, and conversions generally require a PIP and franchisor approval.
Can I finance FF&E separately?
Often, yes. Guestroom furniture, lobby and bar fixtures and technology may be financed separately, subject to the senior lender’s consent.
How long is a Moxy franchise agreement?
Check Item 17 of the current FDD for the term and renewal conditions, and make sure the term outlasts your loan.
Does the FDD include financial performance information?
Review Item 19 of the current FDD to see whether it includes financial performance representations, and rely on a feasibility study for your site.
Final Thoughts
A Moxy Hotels franchise loan is ultimately a commercial real estate development loan with franchise fees layered on top. Owners who budget the full project cost, understand the revenue-based fees, choose management carefully and match the right financing structure to the project give themselves the best chance at a smooth closing.
US Professional Funding helps hotel owners and developers finance construction, acquisitions, renovations, working capital and refinancing for franchised properties. Learn more about our franchise financing and hotel and motel financing solutions.
