RevPAR
Calculate RevPAR and test the rate-versus-occupancy trade-off.
Introduction
Who this is for: Hotel investors and operators measuring trading performance.
Why it matters: RevPAR combines rate and occupancy into one number, which is why the industry lives by it. Two hotels with identical RevPAR can have very different profitability — high-rate/low-occupancy is usually more profitable than the reverse, because variable costs follow occupancy.
Typical scenario: An operator considering a rate rise that may cost some occupancy, and needs to know the net effect.
- Comparing RevPAR across markets without adjusting for cost base.
- Chasing occupancy through discounting, which raises occupancy but can lower RevPAR and profit.
- Using rack rate rather than achieved ADR.
Inputs
Current Trading
keys
Scenario Test
Analysis
Current RevPAR is £61.20 (£85 ADR at 72%). Moving to £92 at 68% increases RevPAR to £62.56, changing annual profit by £73,584 after variable costs.
This analysis provides context, not financial advice. Consult a qualified adviser before making investment decisions.
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Sensitivity
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Live Results
Current RevPAR
£61
Scenario RevPAR
£63
RevPAR Change
£1
Annual Profit Change
£73,584