Motel 6

## Executive Summary

Motel 6 has been a cornerstone of the budget lodging industry since 1962, operating over 1400 locations across the US and Canada. As one of the most recognized economy motel brands in North America, Motel 6 offers franchisees a proven business model with particular emphasis on property conversions rather than new construction.

## Investment Overview

| Investment Component | Amount | |---------------------|--------| | New Construction 100-room | 6,251,265 - 8,239,350 | | Conversion 100-room | 206,850 - 2,106,050 | | Initial Franchise Fee | 25,000 - 35,000 | | Fees to Franchisor | 41,300 | | Royalty Fee | 5 percent of gross room revenue | | Marketing and Program Fees | Additional percentage | | Contract Term | 20 years | | Renewal Term | 10 years |

Note: Investment excludes land acquisition costs.

## Financial Performance

Motel 6 serves the budget traveler segment with consistent demand from cost-conscious travelers, strong brand recognition driving occupancy, economies of scale from large network, and proven operating model in economy segment.

The brand benefits from its positioning as the value leader in the economy lodging segment.

## Training and Support

G6 Hospitality provides comprehensive support including Initial Training of two weeks at corporate offices, Pre-Opening Support with brand standards implementation, Revenue Management tools and pricing optimization, Marketing Support with national advertising campaigns including the iconic We will leave the light on tagline, and Preferred Lender Network with lenders familiar with Motel 6 business model.

## Network Statistics

Motel 6 operates one of the largest economy hotel networks with 1400 plus locations across US and Canada, 80 percent of new agreements being conversions, G6 Hospitality parent company also owns Studio 6, and iconic brand status since 1962.

## Competitive Analysis

Strengths include iconic brand recognition in economy segment, conversion-focused strategy reducing investment, 5 percent royalty lower than many competitors, strong financing network through preferred lenders, and Studio 6 extended stay option for diversification.

Weaknesses include economy segment margin constraints, older property perception in some markets, competition from budget chains, and limited upscale growth potential.

Key Competitors include Red Roof Inn with similar economy positioning, Days Inn as Wyndham economy brand, Super 8 as another Wyndham option, and Econo Lodge with Choice Hotels backing.

## Risk Factors

1. Economy Segment: Lower ADR limits revenue potential 2. Property Condition: Conversion properties may need significant updates 3. Brand Image: Economy positioning may face perception challenges 4. Competition: Numerous budget lodging options available 5. Economic Sensitivity: Budget travelers highly price sensitive

## Investment Recommendation

Target Investor Profile includes property conversion specialists, first-time hotel investors, and budget-focused operators. Motel 6 is ideal for investors seeking established economy brand, low-cost conversion opportunities, proven franchise support system, and accessible entry into hospitality.

Suitability Score is 6.5 out of 10. Motel 6 offers accessible hotel ownership through its conversion-focused strategy with strong brand recognition in the economy segment.