How to choose a hotel operator
A practical guide to comparing operator deals and the questions to ask before you sign — written by an operator, openly biased toward partnership, and honest about it. The checklist works for any deal on your table, including ours.
We make money if you partner with YMME, so weigh this accordingly. We've still tried to make it the guide we'd want as an owner: the real cost of each model, the fees that hide in the fine print, and the questions that separate a partner from a landlord. Where a number is an industry range, we say so. YMME is pre-launch with no operating portfolio yet, so nothing here is a YMME result.
The four models, at a glance
| Model | What it is | What the owner typically pays | Who carries the risk | Keep your brand? |
|---|---|---|---|---|
| Franchise | You run the hotel; you rent the brand and its systems. | Royalty + marketing + reservation and loyalty fees — often 8–12% of room revenue all-in. | The owner carries all operating risk. | No — you fly their flag. |
| Management | An operator runs the hotel for you, day to day. | Base fee 2–4% of total revenue + incentive 5–9% of GOP, with central and marketing fees on top. | The owner carries most of the financial risk; the operator earns its fee regardless. | Usually their brand; sometimes white-label. |
| Lease | The operator rents the hotel from you and keeps the profit. | Fixed rent (sometimes fixed + a variable share) paid to the owner. | The operator carries the operating risk; the owner gives up the upside. | The operator's brand. |
| Partnership | The operator runs the hotel and is paid mostly on results. | A lower base plus a share that only grows when your profit does; owner-priority structures pay the owner first. | Shared — the operator only wins when the owner wins. | Yes — your brand stays on the door. |
Ranges synthesise public industry sources (HVS, CBRE, HotStats, STR) and vary widely by market, scale and brand — treat them as indicative, not a quote. We break the models down in full in operator models explained.
12 questions before you sign
- Money
- 01
What is the all-in cost? Add every line — base, incentive, marketing, reservation, loyalty, technology, procurement markups — not just the headline rate.
- 02
Is the operator paid on revenue or on profit? Revenue-based fees get paid even in a bad year; profit-based fees keep them aligned with you.
- 03
Is there an owner's priority return before any incentive fee kicks in? See the economics.
- Control
- 04
Whose brand is on the door — and can you keep yours?
- 05
Who controls pricing, distribution and the guest relationship? The OTA and the operator both want it — see the real cost of OTA commissions.
- 06
What can you veto? Annual budget, major capex, key hires.
- Exit
- 07
How long is the term, and what does it cost to leave? A long lock-in with heavy penalties is a warning, not a detail.
- 08
Can you sell the hotel without the operator's consent or a transfer fee?
- 09
On exit, do you get all your data and systems back, cleanly?
- Data & technology
- 10
Where does your guest data physically live, and who is the data controller? See who owns your hotel's data.
- 11
Is there a Data Processing Agreement, and continuity protection — source-code escrow, a path to keep running — if the vendor disappears? See data & security.
- People & standards
- 12
Who trains and retains the staff, and how is the standard held when people leave? See why your hotel can't hold a standard.
Five red flags
- A 10–20 year term with heavy penalties for leaving early.
- Fees that don't move whether the hotel makes money or not.
- "The cloud" offered as the answer to where your guest data lives.
- Mandatory, expensive brand standards that erase what made your hotel yours.
- No clean export of your data and guest relationships on exit.
Have a deal on your table? We'll read it with you.
Send us your current or proposed operator agreement and we'll walk through it against this checklist — free, no obligation, no pressure to switch.
Start the conversation