Red Roof franchise
Red Roof is an economy hotel brand with Red Roof Inn and the more updated Red Roof PLUS+ hotels. Franchisees can build a new hotel or convert an existing one. At the end of 2025 there were 623 Red Roof locations in the US, 596 franchised and 27 company-owned.
- Cost to open
- $7.25M–$8.9M
- Franchise fee
- $27,000
- Royalty
- 5%
- Locations, 2025
- 623+50 in 3 yrs
Compare with similar brands Estimate your costs
Company snapshot
- Franchising since
- 1996
- First location
- 1973
- Franchisor based in
- New Albany, Ohio
- Agreement length
- 20 years
- Financing
- None offered
From Red Roof Franchising LLC’s 2026 filing.
How much a Red Roof franchise costs
Opening a newly built 65-room Red Roof Inn, excluding land costs an estimated $7,253,500 to $8,899,600. That covers the franchise fee and everything else needed to open, through the first months of working capital.
| Conversion of an existing hotel | $264,850 to $1,596,100 |
|---|
Source: Red Roof Franchising LLC, 2026 filing, page 27
Red Roof franchise fee
The franchise fee is $27,000, for up to 100 rooms, plus $300 per additional room and a $3,000 application fee. You pay it when you sign the franchise agreement.
Source: Red Roof Franchising LLC, 2026 filing, page 15
Royalty and ongoing fees
| Royalty | 5% of gross room revenues, paid monthly. |
|---|---|
| Brand or marketing fund | 4% of gross sales |
Source: Red Roof Franchising LLC, 2026 filing, page 17
Sales and earnings
Shares figures Red Roof publishes sales or earnings figures for its locations: it gives 2025 average daily rate, occupancy and RevPAR for inns open at least a year. The full tables, with notes on which locations are counted, are in its filing.
Source: Red Roof Franchising LLC, 2026 filing, page 65
Locations opened and closed
| Year | Franchised | Company-owned | Closed |
|---|---|---|---|
| 2023 | 561 (+15) | 45 | 26 |
| 2024 | 584 (+23) | 35 | 21 |
| 2025 | 596 (+12) | 27 | 25 |
Closed or left counts terminations, non-renewals, locations bought back by the franchisor and locations that stopped operating.
Source: Red Roof Franchising LLC, 2026 filing, page 71
Similar franchises
Red Roof franchise questions
Does Red Roof help with financing?
No. Red Roof does not offer financing or guarantee loans or leases, so buyers arrange their own, usually a bank or SBA loan.
How long is a Red Roof franchise agreement?
The initial term is 20 years. Renewal is usually possible if you're in good standing, often for a fee and a remodel.
Is Red Roof growing or shrinking?
Over the last 3 years 122 franchised locations opened and 72 closed or left, a net change of +9.2%.
Does Red Roof say how much franchisees make?
Yes: it gives 2025 average daily rate, occupancy and RevPAR for inns open at least a year. Your results can differ; the filing explains which locations are counted.
Where is Red Roof based?
Red Roof Franchising LLC is based in New Albany, Ohio and the brand has sold franchises since 1996; the first location opened in 1973.