other material
confidence high
sentiment neutral
materiality 0.70
SVC enters 15-year Sonesta management pacts for 59 hotels; 111 sale hotels under agreement
Service Properties Trust
- New 15-year management agreements for 59 retained hotels with Sonesta, effective Aug 1, 2025, with two 10-year renewal options.
- Base fee: 3% gross revenue (full-service), 5% (extended stay/select); incentive fee 20% of EBITDA above threshold, capped at 3% or 5% of gross revenue.
- Brand promotion fee 3.5% of gross room revenue; loyalty fee 1%-4.5% of room revenue; centralized service fee $1.1M (full-service) or $250K (others), CPI-adjusted.
- SVC has sold 10 of 122 sale hotels and entered agreements to sell 111 more; Sonesta waived termination fees on sale hotels.
- Owner can terminate if performance thresholds not met for two consecutive calendar years starting 2028.