Zeidel & Associates Guides a Restaurant Group’s Hotel Debut
Situation
A well-established restaurant group—known for successful standalone concepts in retail environments—was preparing for its first multi-outlet venture within a hotel. Retained by the owner of a Hyatt-branded property, the group was tasked with supporting renovation plans, developing new unique concepts for all the outlets, spearheading pre-opening efforts, and ultimately managing long-term F&B operations. Our role was to identify risk exposures and strategic misalignments in the owner’s draft agreements.
Approach
We represented the client across both the pre-opening Transition Services Agreement (TSA) and the long-term Food and Beverage Management Agreement. Drawing on deep experience in hospitality operations, risk allocation, and long-term F&B management structuring, we quickly flagged critical risks in the proposed sequencing: the client was asked to sign the TSA first and deliver proprietary designs, branding, menus, and operating manuals—without assurance of a long-term management deal. To protect our client’s investment, we negotiated terms that provided that the client retained ownership and control of these deliverables until the hotel committed to a minimum operating term, ensuring economic viability of this transaction for our client.
As negotiations progressed to the management agreement, we tackled a range of new considerations for our client operating in a branded hotel environment. These included data privacy obligations, website and social media governance, renovation control, non-compete provisions, allocation of accounting and other resources, and management of cash receipts.
Result
We successfully secured guaranteed payment for our client during the consulting phase, providing crucial upfront assurance. We also negotiated a binding commitment from the hotel owner to proceed with a long-term management agreement, ensuring operational continuity. Importantly, we preserved and protected the client’s proprietary concepts and materials, safeguarding their intellectual property throughout the engagement. Our work not only protected the client’s business interests but paved the way for their successful expansion into hotel-based F&B management.