What's "Broken" in Hotels? The Same Things That Were Broken 20 Years Ago.

I've seen this movie before. A senior executive leaves a major brand, takes a few months to decompress, and then starts doing the podcast circuit talking about what's broken in the industry. And every time... every single time... the list sounds almost identical to the one the last guy recited five years earlier. Labor. Technology. Owner economics. The gap between what brands promise and what they deliver at property level. The franchise model's misaligned incentives. Pick any three. You'll be right.

Brian Quinn spent four-plus years as Sonesta's chief development officer, helping engineer their pivot from a management-heavy portfolio to a franchise-growth machine. And by the numbers, it worked. Twenty-six percent franchise net unit growth in 2025. Seventy-one franchise agreements executed in 2024 alone. They sold off 114 hotels from the Service Properties Trust portfolio (carrying value around $850 million) and converted a chunk of them into long-term franchise agreements. That's not nothing. That's a playbook that worked exactly as designed... for the franchisor. The question nobody on these podcasts ever answers honestly is: how's the owner doing three years in?

Look, I don't know exactly what Quinn said in this particular conversation because the substance is thin on the ground. But I know what a development officer who just left a brand always says, because I've been in this business 40 years and the script doesn't change much. They talk about the need for better technology (true), the labor crisis (true), the importance of being "franchisee-friendly" (a phrase that means different things depending on which side of the franchise agreement you're sitting on). And all of it is accurate. None of it is new. The things that are broken in hotels are the same things that were broken when I was a 32-year-old trying to figure out why the brand's reservation system couldn't talk to our PMS. We've just added more zeros to the numbers and fancier language to the problems.

I sat in a meeting once with a development VP who'd just left one of the big-box brands. He was consulting now, advising owners, "telling it like it is." And an owner in the room... quiet guy, been in the business 30 years... raised his hand and said, "You knew all this was broken when you were on the inside. Why didn't you fix it then?" The room got very quiet. Because that's the question, isn't it? The system isn't broken because nobody knows. It's broken because the incentives don't reward fixing it. Brands make money on growth... franchise fees, loyalty assessments, reservation contributions. They don't make money on making sure the owner in Tulsa is hitting a 12% cash-on-cash return. The franchise model, as currently constructed at most major companies, rewards unit count growth and punishes the kind of slow, expensive, property-level operational work that would actually fix what's broken.

Sonesta's 13-brand portfolio is a perfect case study. Thirteen brands. A thousand properties. That's an average of roughly 77 hotels per brand. Some of those brands have real identity and market position. Some of them exist because someone in a conference room needed a flag to put on a conversion deal. And the owners who signed franchise agreements during that aggressive growth push? They're about to find out whether "franchisee-friendly" means anything when it's year two and the loyalty contribution is 18% instead of the 35% in the sales deck. I've watched this exact pattern play out at three different companies over the past two decades. The growth phase is exciting. The accountability phase is where it gets real.