Value Place

For prospective franchise investors navigating the complex hospitality sector, the critical decision of selecting a resilient and high-performing brand often hinges on understanding its foundational history, strategic evolution, and robust unit economics. The Value Place franchise, initially conceived to address the growing demand for economical, longer-term lodging solutions, represents a pivotal predecessor to one of the extended-stay segment’s most successful brands. Founded in 2003 by the visionary hospitality innovator Jack DeBoer in Wichita, Kansas, Value Place was built upon a deep understanding of the extended-stay market, a segment DeBoer himself had previously shaped through the creation of brands like Residence Inn, Summerfield Suites (now Hyatt House), and Candlewood Suites. The inaugural Value Place hotel opened its doors in Wichita, Kansas, in 2004, establishing an operational blueprint focused on efficiency and value. This initial brand rapidly expanded its footprint, growing from an early count of 18 total units, all franchised, to a substantial 181 locations spread across 32 states by January 2013, with an ambitious target of over 300 properties committed by 50 franchise groups by 2015. By April 2015, on the cusp of its strategic rebranding, the Value Place portfolio encompassed 196 hotels situated in 32 states, comprising 84 company-owned properties and 112 franchised locations, demonstrating a significant scale and market presence before its transformation into WoodSpring Suites. The strategic rebranding to WoodSpring Suites in April 2015 aimed to elevate the brand's perception, better communicate the quality of its product, and broaden its appeal to new customer segments, ultimately leading to its acquisition by Choice Hotels International in December 2017 for approximately $231 million. Today, the lineage of Value Place, through WoodSpring Suites, stands as a key component of Choice Hotels' extended-stay portfolio, boasting 256 hotels with 30,846 rooms across the United States as of December 2024, and celebrating the opening of its 300th hotel in September 2021, underscoring its dominant and continually expanding market position within the economy extended-stay category.

The broader hospitality industry, and particularly the extended-stay hotel sector, presents a compelling landscape for franchise investment, driven by fundamental shifts in consumer behavior and robust market dynamics. This segment, focused on longer-term guests, offers an appealing alternative to traditional hotel stays, addressing a persistent market need for economical and convenient lodging. The extended-stay industry has consistently demonstrated remarkable resilience, even during periods of significant economic turbulence such as the COVID-19 pandemic, showcasing its inherent stability and counter-cyclical demand patterns. A key indicator of its vitality is the fact that demand for the extended-stay segment has been outpacing supply by a ratio of nearly two to one, signaling a robust and underserved market. This sustained imbalance creates a favorable environment for new development and expansion, making the Value Place franchise's successor brand a particularly attractive opportunity. Investors and developers are increasingly drawn to extended-stay properties due citing their historical outperformance compared to traditional hotels, which average a 15% occupancy premium, alongside higher profitability margins and more streamlined operating models. The underlying consumer trends fueling this growth include a strong and sustained demand for affordable, apartment-style accommodations, which are specifically designed for longer stays and feature essential amenities such as full kitchens, complimentary Wi-Fi access, and convenient on-site laundry facilities. These features resonate strongly with diverse traveler segments, including traveling professionals, families on extended trips, and essential healthcare workers, ensuring a broad and consistent customer base. Notably, WoodSpring Suites, the direct evolution of the Value Place franchise, commanded approximately 94% of the economy extended-stay rooms under construction at the close of 2022, solidifying its leadership and growth momentum within this high-demand niche.

Investing in a Value Place franchise, now operating as WoodSpring Suites under Choice Hotels International, entails a substantial commitment, reflecting its position as a premium opportunity within the extended-stay hospitality sector. The initial franchise fee for a WoodSpring Suites property is $50,000; however, for properties with 122 rooms or fewer, the affiliation fee remains $50,000, while for each additional room beyond that threshold, an additional $300 is assessed, with a minimum affiliation fee of $60,000 applied for transfers and renewals. The total initial investment required to establish a WoodSpring Suites franchise presents a significant financial outlay, with reported ranges from $8,277,000 to $10,946,000. Other comprehensive analyses indicate an even broader spread, from $8,229,200 to $13,293,300, or a more precise range of $8,461,190 to $11,236,342, all figures provided by the franchisor in the Franchise Disclosure Document. An older data point from 2022 suggested a range of $5,035,000 to $7,031,000, illustrating the dynamic nature of development costs. Specific expenditure types contributing to this total investment include construction costs and associated consultation/advisory services, which represent the largest component, estimated between $7,371,240 and $9,009,212. Additionally, furniture, fixtures, and equipment (FF&E), encompassing inventory and systems, range from $689,056 to $842,288, while exterior signage costs can fall between $40,000 and $100,000. Other essential upfront expenses include insurance, estimated at $45,000 to $165,000, and training, travel, and living expenses during the training period, which typically amount to $7,000 to $9,000. To meet these substantial initial capital requirements, a minimum of $1,900,000 in liquid capital is required for a WoodSpring Suites franchise, a significant increase from the older Value Place requirement of $500,000 in liquid capital for interested parties. Ongoing financial obligations include a royalty fee of 6.00% of gross revenues, a slight increase from the 5% royalty rate associated with the Value Place brand. Furthermore, franchisees contribute an advertising or national brand fund fee of 2.50%, which falls within the typical industry range of 1% to 4% of net sales, ensuring continued brand visibility and marketing support. The parent company, Choice Hotels International, Inc., a Delaware corporation established on January 8, 1963, as Quality Inns International, Inc., and renamed on July 25, 1990, provides robust corporate backing, with its principal business address located at 1 Choice Hotels Circle, Suite 400, Rockville, Maryland 20850, and led by President and CEO Patrick Pacious.

The operating model for a Value Place franchise, now known as WoodSpring Suites, is distinguished by its emphasis on efficiency and streamlined operations, a core tenet established by its founder Jack DeBoer. Franchisees are engaged in a hands-on business that requires significant commitment, underscoring that this is not an "absentee" investment. The operational design allows for remarkable labor efficiency, with properties typically featuring approximately 122 rooms capable of being managed with as few as 6 or 7 full-time employees, a testament to its optimized processes. The predecessor Value Place brand similarly highlighted its lean staffing model, requiring as few as 4.0 to 4.5 full-time equivalent employees per property, which significantly contributes to keeping operating expenses low and enhancing profitability. While the primary format focuses on the core extended-stay offering, a brand extension, WoodSpring Suites Signature, was launched in 2015 to offer an enhanced product for less price-sensitive guests, incorporating additional amenities such as a fitness center, laundry facilities, and meeting spaces. Choice Hotels International, as the franchisor, provides a comprehensive training program for new franchisees and their designated staff. This initial training, a mandatory prerequisite, must be successfully completed by the property manager and other key personnel before the hotel's opening, focusing on system standards and operational procedures to ensure brand consistency and service quality. One source indicates this robust curriculum is conducted over a period of five weeks at the WoodSpring Suites corporate office. Beyond initial training, franchisees benefit from ongoing operational support and access to a comprehensive suite of resources, including dedicated sales and marketing assistance, centralized brand reputation management, and extensive customer service support via national telephone and online reservation systems, along with customer feedback mechanisms. Franchisees also receive support from a designated business advisor and benefit from expert team members. Regarding territory, WoodSpring Suites generally does not grant exclusive territory protection by default. Each franchise is awarded for a specific site, and the franchisor retains the right to establish additional franchises or company-owned hotels, whether of the same brand or competing brands, in proximate areas. However, under specific conditions, such as demonstrated favorable market factors or a strong, established history with the brand, the franchisor may consider granting exclusive territories or preferred regions, though these are typically subject to termination if the franchisee defaults on their agreement. The original Value Place franchise also explicitly stated its policy of not offering territory protections.

While Item 19 financial performance data is not disclosed in the current Franchise Disclosure Document for Value Place, an examination of its successor, WoodSpring Suites, provides robust insights into the unit-level economics of this extended-stay model. WoodSpring Suites does provide comprehensive financial performance representations within its Franchise Disclosure Document, offering a transparent view for potential investors. The yearly gross sales for a WoodSpring Suites unit are reported at an impressive $2,074,971, demonstrating strong revenue generation capabilities within the economy extended-stay segment. Furthermore, estimated owner-operator earnings, after accounting for various operational expenses, range from $311,246 to $414,995, indicating a significant potential for profitability. The brand boasts gross operating profit margins that exceed 60%, a figure that consistently outperforms many competitors within the broader economy hotel segment, highlighting the efficiency and cost-effectiveness of its operational model. Despite these strong performance metrics, the estimated Franchise Payback Period is calculated at 31.1 to 33.1 years, which reflects the substantial initial investment required for new construction in the hospitality sector. Recent performance data further underscores the brand's strength: in 2021, WoodSpring Suites achieved record performance, maintaining over 80% occupancy for 230 consecutive days and experiencing an 18% increase in Revenue Per Available Room (RevPAR) compared to the same period in 2019. This momentum continued into 2022, where WoodSpring Suites recorded a 77% occupancy rate, slightly surpassing the national average of 76.1% for the economy segment, showcasing its consistent ability to attract and retain guests for longer stays. The significant acquisition of WoodSpring Suites by Choice Hotels International for approximately $231 million in December 2017 further validates the underlying asset's profitability, growth potential, and strategic value within the extended-stay market. These strong financial performance signals from the rebranded entity, which directly evolved from the Value Place franchise, suggest a highly attractive and resilient business model.

The growth trajectory of the Value Place franchise and its successor, WoodSpring Suites, demonstrates a dynamic expansion strategy and a strong competitive advantage within the extended-stay market. As Value Place, the brand had already established a significant footprint, with 181 locations operating in 32 states by January 2013, and this number grew to 196 hotels across 32 states by April 2015, just prior to its rebranding. Following the transition to WoodSpring Suites, the brand maintained its rapid expansion, reaching 256 hotels with 30,766 rooms by March 31, 2019. By June 3, 2019, the brand boasted over 250 hotels open in more than 38 states, with an additional 100-plus properties in the development pipeline, signaling robust future growth. A significant milestone was achieved in September 2021, when WoodSpring Suites celebrated the opening of its 300th hotel. As of December 31, 2022, the brand maintained over 200 open hotels domestically and an impressive pipeline of over 300 hotels across the U.S., with Choice Hotels reporting a pipeline of 300 total WoodSpring Suites hotels extending beyond 2023. The brand's expansion continued with record-setting pace, opening six hotels in a single month in May 2023, including its first property in New York, alongside new locations in Texas, Virginia, Illinois, Florida, and California, bringing the total openings for 2023 to 12 at that point. This aggressive expansion has led to strong traction, particularly in the western U.S. Key corporate developments include the rebranding of Value Place to WoodSpring Suites in April 2015 to enhance market perception and expand reach, alongside the launch of a brand extension, WoodSpring Suites Signature, offering enhanced amenities to appeal to less price-sensitive guests. The acquisition of WoodSpring Suites by Choice Hotels International for $231 million in December 2017 was a significant validation of the brand's value and future potential. Earlier, as Value Place, the company strategically acquired 22 operating properties from its largest franchisee for $115 million in September 2013, increasing its owned properties to 74 out of 185 total locations, a move aimed at accelerating franchise growth and improving operating efficiencies. The brand's competitive moat is built on its highly efficient operating model, which keeps labor costs low, its specialized focus on the resilient extended-stay segment, and its ability to provide essential apartment-style amenities like full kitchens and free Wi-Fi that cater specifically to longer-term guests. Under Choice Hotels, the brand benefits from enhanced brand recognition, a robust supply chain, and a strategic real estate approach that continues to drive its rapid nationwide expansion and strong customer loyalty.

The ideal candidate for a Value Place franchise, operating under the WoodSpring Suites brand, is an experienced and committed business professional, as the high investment and operational model necessitate a hands-on approach. This is not an "absentee" business, requiring significant dedication and active engagement from the franchisee. While specific experience or management background requirements are not explicitly detailed, the scale and complexity of a multi-million dollar hotel investment typically attract individuals or groups with prior hospitality, real estate development, or multi-unit business ownership experience, coupled with robust financial acumen. The brand's aggressive growth trajectory and the historical acquisition of multiple properties from a single franchisee by Value Place in 2013 strongly imply an expectation or preference for multi-unit operators capable of developing and managing several locations. Available territories for WoodSpring Suites are extensive and continually expanding across the United States, with the brand actively pursuing rapid nationwide expansion. Recent openings in May 2023 in diverse markets such as New York, Texas, Virginia, Illinois, Florida, and California, along with strong traction in the western U.S., highlight the broad geographic focus. Historically, Value Place had ambitious expansion plans targeting metropolitan markets including Boston, Atlanta, Cleveland, Denver, southeast Florida, Tampa, Charlotte, Chattanooga, Miami, Fort Lauderdale, Chicago, Minneapolis, Los Angeles, Seattle, and Portland, indicating a widespread demand for the extended-stay concept. The timeline from signing a franchise agreement to the opening of a WoodSpring Suites hotel is substantial, given the new construction model, with the required five-week initial training program for key personnel preceding the hotel's operational launch. While the specific franchise agreement term length is not available, the presence of an affiliation fee of $60,000 minimum for transfers and renewals indicates a structured process for continuing or transferring ownership, providing clarity on long-term engagement.

The Value Place franchise, through its evolution into WoodSpring Suites, offers a compelling investment thesis within the resilient and high-growth extended-stay hotel sector. This opportunity warrants serious due diligence from prospective investors seeking a proven model with robust financial performance and significant corporate backing. The brand's foundational commitment to efficiency, established by Jack DeBoer, combined with its strategic rebranding and subsequent acquisition by Choice Hotels International for $231 million, underscores its enduring value and potential. Operating in an industry segment where demand consistently outpaces supply by nearly two to one, the WoodSpring Suites model delivers higher profitability and more efficient operations compared to traditional hotels, averaging a 15% occupancy premium. With yearly gross sales reported at $2,074,971 and estimated owner-operator earnings ranging from $311,246 to $414,995, alongside gross operating profit margins exceeding 60%, the unit-level economics are highly attractive. The brand's impressive growth, from 181 Value Place locations in 2013 to over 300 WoodSpring Suites hotels open by 2021 and a pipeline of 300 more, demonstrates a strong market presence and expansion capability. PeerSense provides exclusive due diligence data including SBA lending history, FPI score, location maps with Google ratings, FDD financial data, and side-by-side comparison tools. Explore the complete Value Place franchise profile on PeerSense to access the full suite of independent franchise intelligence data.